Early Internationalization Research Articles

Business model innovation of international new ventures: An empirical study in a Swedish context

Business model innovation (BMI) is receiving increased academic attention as a tool for gaining new or retaining existing firms’ competitive advantages. This paper investigates value delivery and value capture dimensions of BMI utilized by international new ventures (INVs) and shows how this category of firms differs from other internationalized firms in Sweden. Our findings indicate that INVs tend to innovate value delivery and value capture dimensions in the form of sales channels and logistical methods more frequently than other internationalized firms and reconfigure their external relationships more intensively as well. By utilizing longitudinal data, we show that these aspects continue to differentiate INVs and constitute a unique characteristic of INVs over time. Hence, this study enhances the academic debate on business models of INVs as well as on their long-term development past early internationalization efforts. From a managerial perspective, the study highlights where to focus BMI initiatives for sustained international presence and growth.ResumenLa Innovación del Modelo de Negocios (IMN o BMI por sus siglas en inglés) está llamando la atención entre los académicos, como una herramienta que permite a las compañías ganar nuevas ventajas competitivas o retener las existentes. Este artículo investiga las dimensiones de entrega y captura de valor de la IMN utilizada por nuevas empresas internacionales (NEIs o INVs por sus siglas en inglés) y muestra cómo éstas se diferencian de otras empresas internacionalizadas en Suecia. Nuestros resultados indican que las NEIs tienden a innovar las dimensiones de entrega y captura de valor, en forma de canales de venta y métodos logísticos, más frecuentemente que otras empresas internacionalizadas y que, además, reconfiguran sus relaciones externas de forma más intensa. A partir de datos longitudinales mostramos que estos aspectos diferencian a las NEIs y constituyen una de sus características únicas a través del tiempo. Por lo tanto, este estudio mejora el debate académico sobre los modelos de negocio de las NEIs, y su desarrollo a largo plazo como fruto de esfuerzos tempranos de internacionalización. Desde una perspectiva gerencial, este estudio muestra en dónde enfocar las iniciativas de IMN para lograr presencia internacional y crecimiento de forma sostenible.

A Novel Measurement of Speed in Early Internationalization of New Ventures

This study offers a novel approach in conceptualizing and measuring the internationalization speed of new ventures. International entrepreneurship literature deals extensively with the internationalization speed of new ventures; yet, there is not an agreed upon conceptualization of speed. Majority of studies operationalize speed as the time it takes from inception to make the first international activity. However, we know from Physics, speed is equal to distance divided by time. So, current perspective in internationalization literature misses the distance dimension. As a main contribution of this study, we calculate speed in terms of distance and time by using CAGE distance framework with gravity model, investigate the antecedents of this new speed calculation for international new ventures and compare results with the traditional speed measure of time only. Results indicate new speed measurement is more reliable and valid.

Timing is Everything:Impact of Age at International Entry and IPO on New Firm Survival and Growth

Internationalization presents both opportunities and risks that can fundamentally affect new firms’ survival and growth prospects. Research suggests that early internationalization is a high-risk g...

Born or grown global? New Venture Internationalization and International Knowledge Resources

What drives the early internationalization of young firms? In this article, we extend our understanding on the international development of new ventures by examining the role of pre- foundation international experiences and ex post foundation international knowledge acquisition of entrepreneurial founding teams [EFTs]. For this, we trace the growth path of 99 high technology IT ventures. We find that congenital international knowledge transfer, i.e. a founder’s prior work and study experience abroad, does not imprint consecutive firm internationalization. Rather, the early professionalization of the initial founding team by means of recruiting internationally trained managers is associated with a more rapid international expansion. Our findings suggest that firms are not “born” global, but rather “grow” global through target oriented knowledge acquisition during their early development phase. These results have implications for the international entrepreneurship literature and international new venture theory. They are also instructive for practitioners such as venture capitalists who are involved in the coaching of young entrepreneurial firms and frequently restructure EFTs.

Promotion Tools Applied by Polish INVs on Foreign Markets

Marketing capabilities are argued to be one of the critical capabilities of International New Ventures (INVs) facilitating their early internationalization. Although companies from post-transformation Central and Eastern Europe Countries are active and successful participants of the global market, their marketing capabilities were not subject to the complex studies yet. This paper addresses this research gap and aims to identify the types and importance of the promotion tools applied by INVs from this region. It presents the results of the multi-mode method (CATI combined with CAWI) study of 297 Polish small and medium INVs. It shows, that they rather do not apply a very diversified set of promotional tools. The most common tools applied by them on the foreign markets are trade fairs and exhibitions, internet advertising, PR, personal sales and Internet tools other than Internet advertising, with the most importance given to PR. The most differentiated set of promotion tools is applied by companies operating both on the B2B and B2C market. Classification-JEL: Keywords: INVs; Promotion tools; Marketing capabilities; Central and Eastern Europe Countries; B2B; B2C

Early internationalization patterns and export market persistence: a pseudo-panel data analysis

This study evaluates the international market persistence of early exporting businesses. The relationship between time in the market and export propensity/intensity levels was analyzed to identify the persistence of the internationalization patterns of entrepreneurial ventures. The empirical application employs a pseudo-panel approach at the business age- and industry-based cohort level drawn from a group of independent cross-sectional surveys that include information for 13,961 independently and randomly selected business owners for the period 2007–2012. The results show that the proportion of firms that export significantly diminishes following the initial post start-up years and that low export intensity levels at start-up leads to greatest tenacity and persistence of the exporting efforts for new firms. The results contribute to the recent discussions on whether early internationalization is an effective strategy and should be encouraged.

The antecedents of early internationalization: A configurational perspective

The literature on international business and international entrepreneurship provides multiple explanations for early internationalization. Using fuzzy-set qualitative comparative analysis, this study examines the antecedents of early internationalization for small firms based in a small economy, focusing on entrepreneurs’ attitudes toward the economic opportunities available in their domestic market, the risk of internationalizing, and the profitability of entering foreign markets. Three additional antecedents are examined: unsolicited orders, existence of underutilized capacity, and the behavior of competitors. The study uncovers three distinct combinations of antecedents that are equifinally linked to the early internationalization of small enterprises, and contributes to the literature through a multi-causal, configurational approach.

International entrepreneurship research versus international business research: A false dichotomy?

International entrepreneurship (IE) research draws from work in both international business (IB) and general entrepreneurship. It examines, inter alia, entrepreneurial behaviour when crossing borders (first stream), and makes international comparisons of entrepreneurship as found in different countries and regions (second stream), see Wright and Ricks (1994). 1 Two influential IE articles have been bestowed with the JIBS Decade Award, namely Oviatt and McDougall (1994) and Knight and Cavusgil (2004). Both articles suggested the need for new theory to explain the empirical phenomenon of ‘early internationalization’. These papers developed the concepts of International New Venture (INV), and Born Global (BG), respectively, and stimulated a lively debate on early internationalizing companies. Oviatt and McDougall defined an INV as a: … business organization that, from inception, seeks to derive significant …

The role of networks in early internationalizing firms: A systematic review and future research agenda

Despite considerable research, the international entrepreneurship (IE) literature lacks systematic knowledge of how early internationalizers use networks to overcome their resource deficits in different phases of internationalization. Further, a systematic guide for future research to expand the current knowledge of early internationalizers' network dynamics throughout their internationalization process is missing to date. To fill these voids, the present paper conducts a systematic review of sixty-one journal articles on the role of networks in the cross-border expansion of early internationalizing companies. We contribute to existing research by taking stock of the current state of knowledge regarding the role of networks in early internationalizing firms in different faces of internationalization. We also use the findings obtained from our review as a platform to systematically identify opportunities for future research regarding early internationalizers’ network dynamics throughout the internationalization process.

Gender differentiation and citizenship acquisition: Nationality reforms in comparative and historical perspective

Feminist scholars have made an impressive contribution to the rethinking of citizenship, but they have largely neglected the gender differentiation of citizenship acquisition. This neglect has resulted in a lack of knowledge concerning the processes of change underpinning nationality reforms that have weakened the patriarchal nature of citizenship. This article seeks to fill the current void through a comparative analysis of nationality reforms that have granted married women an independent right to nationality and mothers the right to transmit their nationality to their children. It examines the politics of these reforms in the United States, France and Germany as well as the international dimension of these nationality reforms. The analysis reveals the long-term significance of the early internationalization of women's nationality rights and the interplay between domestic and transnational feminist activism.

Internationalization and innovation: The case of a born global from Brazil

The significance of Born Global firms´ study is increasing due to their early internationalization aspects, innovation and economic growth; however, most of existent studies are focused on developed markets. This is the reason why this study is addressed to analyze the internationalization effects on the innovation in a Born Global firm from emerging market. We have used the literature review about innovation, internationalization and Born Global from emerging markets, also an in-depth interview with the founder and the financial/administrative coordinator of a Brazilian Born Global company that have demonstrated a proactive internationalization behavior moving to the United States. The result shows that, the internationalization to a country with stable institutions affects positively the innovation of the firm, providing the possibility of exploring resources, resulting in financial growth, superior knowledge and capabilities. This research contributes for an improved knowledge of the phenomenon in the context of emerging markets. Also, the perspective of institutions in the host country, which determines the firm´s innovation performance and finally, we explore the case of a firm from an emerging economy that moved to a developed country (South-North) to develop new capabilities and maintain its strategy of innovation.

Was it Merely a Coincidence? Towards a Practice-Based Perspective on Early Internationalisation of SMEs

Objective : The aim of this this paper is to analyse the relation between some aspects of reflexive actions and the routinization within the internationalization process. The article provides a new insight into the phenomenon of early internationalization of small and medium-sized enterprises. Research Design & Methods : A qualitative research offers an alternative approach to the problem of how enterprises explore foreign opportunities in the realms of daily performed activities. Findings: A qualitative research provides a framework of the relation between various types of reflexive actions, and their routinization, as well as the internationalization of everyday practice. Implications & Recommendations: This work contributes to the deeper understanding of the early internationalization process and that it sheds some new light on its potential explanatory categories. The notion of daily activities may be perceived as important units of analysis in management. Contribution & Value Added: The analysis of everyday activities of early internationalization of SMEs may comprise here a promising research area and therefore, a ‘theoretical bridge’ between the practice-based perspective and IE may develop.

Strategic Entrepreneurial Internationalization: A Normative Framework

Research summary Much of the literature on international new ventures (INVs) focuses on early internationalization and views it as an expression of firm-specific advantages that existed prior to internationalization. This article presents a normative framework that articulates how INVs can leverage internationalization to drive de novo competitive advantage. Drawing on the organizational capability and business model design literatures, the framework of strategic entrepreneurial internationalization (SEI) argues that INVs that adopt an active learning orientation, harness digital infrastructures for cross-border business model experimentation, encapsulate cross-border asymmetries in their activity system, and adopt a niche orientation are more likely to succeed in building sustainable competitive advantage. Managerial summary Internationalization can be used strategically to build competitive advantage in the firm and its business model. This is because internationalization exposes the firm to different markets and different competitive environments, therefore providing a potentially rich source of learning and capability development. However, competitive advantage does not automatically follow internationalization: managers of internationalizing new ventures must actively experiment with different business models in different markets to discover ones that work best. The firm also has to make an effort to distill the lessons learned from foreign markets and adjust its business model accordingly. Learning is more effective in narrow niches. Long-term advantage can be ensured by cementing cross-border advantages into the cross-border operation. Copyright © 2017 Strategic Management Society

A foreign hotel in London – the history of Hilton’s negotiation of legitimacy in the Swinging Sixties

Abstract Whilst theories of business internationalization assert that foreignness poses challenges to multinational companies’ subsidiaries operating abroad, historical study of Hilton International’s expansion in the 1960s suggests otherwise. In its early internationalization Hilton International transferred abroad its institutional ownership advantages including corporate philosophy and culture, its practices, policies, processes and work systems and product design. Despite claims of social embeddedness, the London Hilton was perceived to be a typically American hotel. Analysis of Hilton’s expansion strategy suggests that the company used its foreignness as a differentiating factor. This article contributes towards the limited business history research in the area of internationalization and knowledge transference. Historical analysis of Hilton’s internationalization contradicts the institutionalism’s assumption that multinationals must adapt to local institutional settings. This article enhances the notion that playing the ‘foreignness’ game can lead to a comparative global advantage.

Interactions Among Factors Driving and Inhibiting the Early Internationalization of Small, Young Technology Enterprises

This study traces the early, rapid internationalization of small, young technology enterprises (SYTEs) to the interaction between industry dynamism and resource constraints. The evidence collected in this study shows that industry dynamism drives the speed of the internationalization and resource constraints inhibit it. Niche and strategic alliance strategies are found to mediate or moderate the relationships among resource constraints, industry dynamism and the speed. These mechanisms have important managerial implications.

Internationalize to live: a study of the post-internationalization survival of new ventures

Despite a growing number of studies on the survival of new ventures who pursue an international entry strategy, research in this area is not yet conclusive. One line of argument tells a story of unprepared novices making a risky move, and thus predicts negative consequences. Another line of argument tells a story of prepared entrepreneurs making a strategic decision, and thus predicts positive consequences. The problem of estimating the true effect involves an important endogeneity problem that can only be overcome by accounting for the fact that new ventures self-select into internationalization. The goal of this research is to add to the post-internationalization survival literature by accounting for this self-selection using an endogenous switching model in a potential outcomes or counterfactual inference approach. Leveraging a panel of US new ventures from the Kauffman Firm Survey, our results paint a picture more in line with the preparedness logic of new venture internationalization. After controlling for this self-selection, we find a positive average treatment effect of internationalization on survival, and we find evidence that early internationalization is better for post-internationalization survival than late internationalization. We argue that these results suggest that the new theories of new venture internationalization needs to be further unchained from the process theories of internationalization.

Drivers of Early Internationalization: A meta-analysis (WITHDRAWN)

This paper is an effort to integrate the results of more than two decades of research on early internationalization. Using a meta- analysis of more than 135 scholarly articles, books and dissertati...

How is the Born Global Phenomenon Different from Internationalization by Established Firms?

The rise of “born global” firms during the most recent phase of globalization has spurred calls for new interdisciplinary frameworks to explain the drivers of early internationalization, particular...

Internationalization to survive; the case of renewable energy companies in Spain

PurposeIn this study, entrepreneurial internationalization in renewable energy industry as a high-tech and emerging industry was explored. The focus of this study is on firm level factors to understand how and why these companies entered the international markets and what are their challenges and difficulties in this process. To answer these questions, two main streams of literature were used: international entrepreneurship (IE) and sustainable entrepreneurship.Design/methodology/approachCase study methodology is selected for this research. Because this subject is new and empirical researches in renewable energy industry are scarce, a method to gather research and in-depth data was adopted. Following suggestions by Eisenhardt (1989), a multiple-case design method was used with nine cases of entrepreneurial companies in renewable energy industry from Spain.FindingsResults show that in renewable energy industry firms, resources and capabilities such as need for funding and rapid commercialization are key factors that encourage companies to enter the international market. However, having access to the technological knowledge cannot be a compelling reason for internationalization of renewable energy companies from Spain. Moreover, the interaction between the large and small firms is an important factor that facilitates the process of internationalization.Research limitations/implicationsIn this study, the focus was only on firm level factors, whereas other levels of analysis such as entrepreneur, environment, policy scheme and industrial factors need further attention in future studies. Moreover, this study is only limited to Spanish companies, and future studies can be replicated in other context.Practical implicationsFindings of the study have significant theoretical and empirical implications. First of all, it explains the entrepreneurial internationalization by taking advantage of sustainable entrepreneurship literature. In addition, empirical results of this study are significantly important for entrepreneurs to implement effective internationalization strategy to survive. Findings of this study can help policy makers for designing a supportive scheme for further development of this industry in the international markets.Originality/valueThis paper explores the entrepreneurial internationalization of renewable energy companies as an emerging industry by taking advantage of two streams of literature: international entrepreneurship and sustainable entrepreneurship. The results show the phenomenon of early internationalization in pre-commercialization phase. These findings put emphasis on interaction between large and small firms in process of internationalization in this specific industry.

Capabilities development and deployment activities in born global B-to-B firms for early entry into international markets

This paper sets out to understand how entrepreneurial founders of born global firms acquire, transform and deploy new knowledge resources for early internationalization. Adopting a dynamic capabilities view and using a sample of high-tech B-to-B firms, we report that the new firm's early entry into international markets is executed through three transitionary phases. Founders transform the operational capabilities they endow to the firm, develop dynamic capabilities for use in opportunity exploitation, and deploy these to develop knowledge-intensive products that they take to chosen niche markets. The paper contributes to the B-to-B global marketing literature by uniting it with born global and INV internationalization research, and elucidating the three phases through which founders manage early internationalization. The roles played by entrepreneurial founders and particular capabilities are discussed.