Born Global Firms Research Articles

Born global firms: The differences between their short- and long-term performance drivers

Globalization has triggered the emergence of a new breed of firms called “Born Globals” (BGs), firms that become international soon after inception. Unlike previous research, the present study distinguishes between BGs’ short- and long-term performance and argues that different drivers affect each type of performance. Data from 107 Israeli BGs shows that their short-term performance is impacted mostly by environmental (external) factors. In contrast, over the long run, internal factors become more crucial to BGs’ survival and success. These time-based differences have important theoretical and practical implications.

Born-Globals and Culturally Proximate Markets

In this paper we focus on the differences between born-globals and older firms. We compare whether cultural proximity is important for born-globals and older firms and whether international or technological knowledge drives their internationalisation. In addition, we compare whether born-globals and older firms are proactive or reactive in their choice of culturally proximate markets. Our research suggests that born-globals tend to internationalise rapidly into markets ready to adopt their technology. This is driven by the need to establish a revenue stream (cash flow) as quickly as possible. These born-globals usually seek larger advanced economies, which are often culturally similar (proximate) and offer economies of scale; reducing risk for inexperienced firms. Indeed, born-global firms are more willing than older firms to move from culturally proximate to culturally non-proximate markets very quickly. Utilising an abductive approach based on case studies, our findings show that born-globals use their technological knowledge and networks and are proactive when they enter culturally non-proximate markets. Born-globals must assess a new market for its ability to provide a revenue stream very soon after entry. If the culturally proximate market does not offer this, then they will leverage technological knowledge and networks to move rapidly into nearby non-proximate markets where they perceive better opportunities for building a customer base or new funding alternatives to sustain the firm in their early foreign market forays. Our research significantly extends theory in highlighting that born-globals rely more on technological experience and display proactive behaviour more than older firms which can draw on previous international experience.

The Role of International Entrepreneurship Capability on International Performance in Born Global Firms

More than two decades, international entrepreneurship (IE) has come out as a distinct academic discipline, and that concentrates on firms that become international from inception or near after it. However, comparatively little is known about the international entrepreneurship (IE), its capability and what drives the international performance of these firms with early and rapidly internationalizations. Therefore, the objective of the investigation is to reveal the dimensions of international entrepreneurial capability (IEC) and its effect on international performance (IP) in born global firms. The study will give an instruction to the born global (BG) managers, vision and strategy to the policymakers, and introduce the effectiveness role of international entrepreneurship capability (IEC) on international performance.

Entrepreneurial orientation, market orientation and internationalisation in born global small and micro-businesses

The purpose of this paper is to provide an insight into entrepreneurial orientation, market orientation and internationalisation in born global small and micro-businesses in Ireland, when owner-manager perceptions are taken into account. Following an exploration of the major theoretical approaches of SME internationalisation and performance, and entrepreneurial/market orientations, a qualitative study is undertaken on owner-managers of four born global firms to present a conceptual model. Although there are a number of studies on born global firms and extensive research on entrepreneurial and market orientations, this study proposes to combine internationalisation and orientation approaches in studying small and micro-businesses. Future studies could empirically test the proposed new conceptual model within a large sample.

Exploring the effects of human capital loss on relationships with clients in knowledge-intensive service firms and the moderating effect of knowledge management

This study aims to examine the effects of human capital loss on relationships with clients in knowledge-intensive born global firms, and explain how firms address the challenges resulting from empl ...

Born global acquirers from Indian IT: an exploratory case study

PurposeThe purpose of this paper is to examine the phenomenon of the born global firm (BGF) in the Indian context. Specifically, the paper explores firm‐level characteristics (from the Indian IT industry) which act as initiating forces for firms which have made cross‐border acquisitions within five years of incorporation.Design/methodology/approachThe paper uses inductive reasoning to derive a theoretical framework of analysis, using constructs from the resource‐based view and institutional theory.FindingsThe paper posits that firm resources, personal and network characteristics of its founders, age of the firm and institutional factors act as the initiating factors for a BGF.Originality/valueThis is the first study on the phenomenon of the BGF from India, which is an important emerging market, and has pioneering value, contributing to the growing literature on the topic.

Exploring the antecedents of born-global companies’ international development

In recent years the emergence of so-called born-global firms -firms which start their international activities from their start up- has challenged traditional theoretical assumptions about the incremental process of internationalization, giving birth to the development of a new stream of studies. In order to give a contribution to this area of studies, the purpose of this paper is to empirically test a model to explain how well some factors are able to explain the level of international development of born global companies. A mail survey was conducted within a sample of born-global Italian companies, belonging to the most representative industries for the Italian economy (metal products and machinery equipment; furniture; chemicals and food). Findings support the validity of a model including five significant predictors: uncertainty and dynamism in the firm’s industry, operating in niche-based industries, markets’ and segments’ knowledge held by the founder/managers, product innovation and firms’ innovativeness, access to networks. Findings are discussed and managerial implications are drawn.

A case study on the internationalization process of a ‘born-global’ fashion retailer

This case study on Zara elucidates the expansion strategies used by both born-global and gradual global fast-fashion retailers based on theories of internationalization. Aspects related to knowledge sharing, resource-based theory, and psychic distance are overlaid with Zara's internationalization strategies to advance understanding of the role fashion plays in dynamic internationalization. Zara employs a high-risk, high-reward model of internationalization to defend its unique merchandise and retail position by remaining completely vertical. Zara's born-global expansion strategy engendered a psychic distance paradox in that it was very successful in distant markets early on. It is proposed that fashion retailers may take note of Zara's success through the proposed ‘dynamic strategic planning process’ for expansion in international markets. Researchers can test the proposed framework empirically to investigate the theoretical constructs for both gradual- and born-global firms.

The Born Global Entrepreneur In Emerging Economies

As emerging economies increasingly participate in the global economy, Born Global firms from these countries are becoming significant players as well. In the literature, topics related to Born Global firms from emerging economies have mostly been overlooked. The purpose of this paper is to address part of this gap by studying the Born Global entrepreneur within the context of an emerging market. Specifically, the Born Global entrepreneurs knowledge and behaviors required to start a Born Global firm in an emerging market as well as the success factors in the global marketplace are examined.

IMPACT OF EXTERNAL BUSINESS ENVIRONMENT FACTORS ON INTERNATIONALIZATION OF LITHUANIAN-BORN GLOBAL COMPANIES

The paper examines the external factors that influence the internationalization of the Born Global firms in Lithuania. The identification of such factors is based on M. Porter’s National Diamond model. Theoretical analysis of the model enabled us to distinguish 23 factors as potentially influencing the internationalization of firms. The impact of these factors on Born Global firms was explored upon performing a survey of 50 Lithuanian firms of this sort. The survey results have revealed seven factors as having a positive effect on the internationalization of Lithuanian Born Global firms.

The early development of Born Global firms in the software industry

This paper explores the early development of five Finnish Born Globals in the software industry, including the characteristics of Born Globals at and post-inception. Results show that Born Globals are not always founded by entrepreneurs with a global mindset and international business experience. Instead founders often resemble the entrepreneurs of the classical start-up development models and are technology-minded with limited knowledge of planning or marketing techniques. As a result, it is not unusual for the venture capitalist investors of Born Globals to push for the installation of an internationally experienced manager as firm CEO once product development is complete.

Environmental characteristics and technological capabilities' interaction in high-technology born global firms

This paper focuses on the growing phenomenon of 'Born Globals' (BGs) – small and technology-oriented firms that become international soon after establishment. Previous research identified that, owing to their unique traits, BGs tend to incept more rapidly in high technology industries. These firms are distinguished by moving quickly from inception to first foreign market entry – a strategy that carries considerable risks. Yet though this early internationalisation is a unique trait of BGs and is their core defining factor, some aspects of it are still under-addressed in the literature. One such element is the role of the external environment, namely target market factors, previously found to affect the operations and performance of gradually globalising firms. This conceptual paper proposes a model for how BGs' technological capabilities interact with their niche marketing focus strategy, and how these interactions moderate the risk factors associated with target markets factors to influence BGs' performance.

Role of international precocity in born global firms

The aim of this paper is to analyse the role of the speed of internationalisation in terms of the economic performance of born global firms. To that end, this research analyses whether the speed of market entry influences the firms' capacity to develop marketing capabilities. Moreover, this work also analyses the way in which the marketing capabilities of these firms determine their international strategy and their financial performance and how the international precocity influences these firms' choice of entry mode. The results obtained support all the hypotheses formulated in a sample of Spanish born global firms.

The innovativeness of Born-Globals and customer orientation: Learning from Indian Born-Globals

Born-Global firms, a newly emerging organizational form targeting international markets as a primary source of business from their inception, have innovativeness, requiring an intimate knowledge of their customer, as a primary feature. This study explores how a Born-Global's customer orientation leads to innovativeness through technological capability for customer relationship management (CRM) and external customer information management. Our empirical results, based on responses from 154 Indian managers, indicate that a Born-Global's customer orientation is an effective enabler of its innovativeness, whose effects are mediated by technological capability for CRM and external customer information management. Although significantly affected by customer orientation, the results further indicate that relationship quality with the buyer does not influence a Born-Global's innovativeness. When CRM technology and managing customer information obtained from external sources are employed, customer orientation significantly helps maintain the innovativeness of Born-Globals according to the results.

International new ventures and governance structures—are international entrepreneurs strategic or entrepreneurial?

Born Global firms have attracted significant research interest over the past decade and one of the recurring research questions is how Born Global firms are able to overcome resource limitations to establish effective international sales and marketing channels so rapidly. Several qualitative studies have been performed in order to investigate this question and most conclude that Born Global firms do it by using entrepreneurial hybrid structures to govern their international activities. This study offers a quantitative analysis on whether there are significant differences between the international activities of small international firms and seeks to determine whether Born Global firms are more ‘entrepreneurial’ in terms of governance of their international activities and resources than other small international firms. The study adopts Aspelund and Moen’s (2005) classification of small international firms according to their time to internationalization and share of foreign sales and investigates differences in characteristics and governance of international activities. As expected, the study found differences in a broad range of characteristics between the firms that had adopted the different internationalization strategies. More surprisingly, the study fails to identify any differences between the firms on international governance structures for international operations. This a very intriguing result as it opposes a lot of qualitative work over the past decade and it also implies that Born Global firms are strategic in deciding their governance structures for international marketing activities regardless of their resource situation. Implications of the findings are discussed and alternative venues for further research are proposed.

International entrepreneurial capability: The measurement and a comparison between born global firms and traditional exporters in China

This study presents the development and application of a new measure of international entrepreneurial capability. The data were collected from manufacturing firms in China, both traditional exporters and born global firms. Five key dimensions of international entrepreneurial capability were identified from the capability and entrepreneurship literature. After scale purification and validation, this new measure was used to examine the relationship between international entrepreneurial capability and global market performance. Born global firms are statistically different from traditional firms along three dimensions: international learning capability, international networking capability, and international experience. Implications and future research directions are then provided.

A model of rapid knowledge development: The smaller born-global firm

Existing models of the internationalization process have not captured the important phenomenon of accelerated international growth of born-global firms, which led Johanson and Vahlne (2003) to revise their model. However, the revised network model falls short of explaining rapid internationalization of firms. While they indicate a “specific relationship development process” used by born-global managers, Johanson and Vahlne (2003) still suggest the existence of an incremental learning and “responsive” model, which is based on pre-existing relationships. We extend current theory in arguing that born-global managers can use both pre-existing and newly formed relationships, to quickly and proactively develop new knowledge for rapid commercialization of their products. Proactive, advanced relationship-building capability is based around locating partners with technological knowledge with a view to ensuring ease of sharing knowledge. We explore the development of trust and inter-firm partnerships in established and newly formed networks and how these lead to tacit knowledge, absorptive capacity and new knowledge generation. While Johanson and Vahlne (2003) emphasize “market specific experience and operation experience” we emphasize “technological experience”. The reason that knowledge sharing is able to proceed quickly is that the shared “technological knowledge” allows rapid transfer and development of new knowledge and the drive to commercialize a product before a competitor, promotes the “mutual need” (co-dependency) to act quickly, characteristic of technology-based industries, which face rapid change. As an outcome of the born-global manager's ability to locate new partners through existing networks, new international links may be quickly developed, with internationalization being an outcome, but not necessarily a driver of behaviour in smaller born-global supply chains.

Factores que inciden en la creación de born global en colombia ,

This research paper examines the factors and conditions that affect the expansion of Born Global firms in Colombia and how they can be assured of success in this national market. The author uses a model of causal relationships, AMOS 16 Software, and data from the survey conducted by GEM Colombia about companies that reported exports during the first years following their establishment. This study reveals that the following factors are associated with “Born Global” companies: market or environmental conditions, founder's profile, and internal company issues. Emphasis is drawn to this last item as a key factor in the creation and consolidation of these international companies.

The Reasons for Emergence of Born Global Firms----Taking China as an Example

With economic globalization and marketing integration, the born global firms, emerging as a new kind of enterprise, have arouses a wide rage of academic interest recently. Based on the previous research, this paper, taking the example of Zhejiang province, China, probes firstly into the main forming reasons of the born global including entrepreneurship, niche market, international management experience, and network, then points out the current problems of lacking innovative entrepreneurship, shorting of manager, Unreasonable industry structure, and finally, the paper puts forward some countermeasures from theoretical and practical approach for the Zhejiang born global firms.

A configuration-holistic approach to born-global firms’ strategy formation process

Summary This paper attempts to offer a deeper conceptual understanding of the early and rapid internationalization process of born-global firms by applying the lens of the strategy-making process. In other words, it offers an integrated strategic management perspective to explain the so-called born-global phenomenon. We argue that born-global firms’ strategy-making processes can be aligned with different schools of strategic thought depending mostly upon the nature of the specific factor/s triggering their particular international strategic behavior and also the specific phase in which they may find themselves along their international development process from inception. The most relevant academic implication to be obtained from this study is to stimulate more creative and integrative thinking on investigating the born-global phenomenon. In addition, both managers of these firms and policy-makers can also benefit from this conceptual research by gaining more knowledge regarding the way in which strategy-making processes can be reconciled from different perspectives and approaches.