Small Business Economics—DOI: https://doi.org/10.1007/s11187-019-00216-y

Getting the facts right on born globals

Ferguson, S., Henrekson, M. & Johannesson, L.

Policymakers in several countries have recently taken steps to promote the rapid export expansion of small- and medium-sized enterprises (SMEs). The goal of these policies has been to create successful export-intensive startups, which are often referred to as born globals. These measures are motivated by studies claiming that born global firms are disproportionately important for job creation and economic growth. Using detailed register data on the universe of Swedish manufacturing startups founded 1998–2014, we find that born globals are a very small group of firms whose long-run size and growth do not outperform other exporting firms. We also show that removing continuing firms and spinouts from the analysis is crucial for obtaining correct results. Thus, the notion that born globals are superior to firms that follow a more gradual internationalization process, a conclusion largely based on case studies and surveys, does not withstand scrutiny. Policymakers must therefore be aware that encouraging more born globals need not necessarily lead to large benefits for the overall economy, especially in terms of employment.

European Management Journal – DOI: https://doi.org/10.1016/j.emj.2020.09.003

Critical capabilities for widening international new ventures’ geographical scope

Andreu Blesa, María Ripollés

Current findings are still inconclusive with regard to the role played by the characteristics of social networks in INVs’ early geographical scope. This study analyses how entrepreneurial-oriented networks affect new ventures’ early geographical scope through critical capabilities. We have adopted a behavioural perspective to investigate the effect of social networks both on international new ventures’ geographical scope and on their critical capabilities such as absorptive and adaptive capabilities. Results from a sample of 183 Spanish international ventures confirm the importance of entrepreneurial orientation as a network characteristic for early geographical scope. Additionally, the positive effect of adaptive capability on new ventures’ early geographical dispersion has been confirmed but not so in the case of absorptive capabilities. Our results suggest that future research must be careful to assume international new ventures’ absorptive capability as a prerequisite to their cross-border expansion.

Journal of International Business Studies—DOI: https://doi.org/10.1057/s41267-020-00360-8

No place like home: The effect of exporting to the country of origin on the financial performance of immigrant-owned SMEs.

Morgan, H.M., Sui, S. & Malhotra, S

Immigrants and sustained international migration are transforming developed Western countries at an unprecedented pace and scale. Sustained international migration is also further accentuating the already-dominant presence of immigrant entrepreneurs in the international business landscape. These immigrant entrepreneurs often operate small and medium-sized enterprises (SMEs) that primarily export to their country of origin. However, conflicting findings suggest theoretical ambiguity in how the level of country-of-origin export intensity influences the SMEs’ financial performance. Adopting a contingent perspective, we theorize how and when socially embedded immigrant owners derive superior performance from high country-of-origin export intensity. Based on a sample of 2584 immigrant-owned SMEs and 6391 firm-year observations, we find that SMEs led by immigrant owners with longer stays in their country of residence and whose country of origin is geographically proximate to their country of residence generate superior financial performance from high country-of-origin export intensity. These findings are consistent with the view that immigrant entrepreneurs’ international financial success is a function of network- and cognition-based advantages linked to their level of concurrent embeddedness in their countries of residence and origin. We also provide actionable insights for immigrant entrepreneurs and for policy-makers tasked to design suitable export promotion programs.

International Entrepreneurship and Management Journal—DOI: https://doi.org/10.1007/s11365-020-00673-y

The interplay of entrepreneurial and non-entrepreneurial internationalization: an illustrative case of an Italian SME

Nummela, N., Vissak, T. & Francioni, B.

This study describes SME internationalization as a process that combines entrepreneurial and non-entrepreneurial behaviour. We bring in insights from prior literature and use an illustrative case study of an Italian SME to demonstrate the interplay of entrepreneurial and non-entrepreneurial behaviour during the internationalization process. Our study shows that the combination of entrepreneurial and non-entrepreneurial internationalization cannot be fully explained with existing International Entrepreneurship literature or other internationalization theories, as they do not take into account the nonlinear nature of internationalization or explain why the process seems to reach a ‘glass ceiling’ beyond which it does not progress. The study concludes with a conceptual framework providing an alternative explanation. Based on our conceptual reasoning we propose that predominantly non-entrepreneurial internationalization can occur without developing a clearly defined internationalization strategy. Additionally, we argue that low commitment to internationalization prevents capability development and may lead to nonlinear internationalization. Furthermore, we suggest that family involvement may moderate a firm’s international entrepreneurial orientation, consequently leading to more non-entrepreneurial internationalization.

Journal of Business Research —  Volume 113, pg, 266-278

The internationalization of social hybrid firms

Fernando Angulo-Ruiz, Albena Pergelova, Léo-Paul Dana

This paper is concerned with the internationalization of firms that combine social and profit objectives at their core, referred to as social hybrid firms. In contrast to most profit-focused firms, such firms tend to place considerable attention on the social impact within their local communities. For this reason, the internationalization behavior of these firms has received limited research attention. In our empirical setting, however, some social hybrid firms go beyond their local communities and internationalize. Using the attention-based view as a theoretical framework, we hypothesize several boundary conditions that affect the internationalization of social hybrid firms and test them with a representative data set of small and medium-sized, privately-owned, indigenous businesses in Canada. Our findings reveal that social hybrid firms are more likely to internationalize when the levels of institutional isomorphism are high and when the organization leverages economic network ties. However, social network ties and government support reduce the likelihood of social hybrid firms to internationalize. The study provides theoretical and practical implications related to the phenomenon of social hybrid firms, their internationalization, and the attention-based view of the firm.

Management International Review – Volume 60 (4).

Special issue on International Networking and Success- vs. Failure-Based Learning of SMEs, guest edited by Jeoung Yul Lee, Alfredo Jiménez, and Timothy M. Devinney

The special issue include articles relevant to IE-scholars. These include the study on the role of networks on learning approaches of rapidly internationalizing SMEs (Puthusserry, Khan, Knight & Miller), SMEs’ learning from global value chains (Soontornthum, Cui, Lu, & Su) and others. The special issue editorial can be found here and the list of published articles here.