The phenomenon of early internationalizing firms: what do we know after a decade (1993–2003) of scientific inquiry?
Introduction
According to McDougall, Oviatt, & Shrader (2003), the study of international new ventures (INVs) is becoming an important part of the growing international entrepreneurship literature (Acs et al., 2003, Christensen, 2003, McDougall and Oviatt, 2000, Young et al., 2003). While many established firms continue to internationalize following a slow, evolutionary path of development (Johanson & Vahlne, 1990), other more dynamic and newly established firms are becoming international at founding or very shortly thereafter. The emergence of these firms, mostly in the last decade, might well indicate that important dimensions of the internationalization process have evolved since the 1970s and 1980s, when much of the existing theory was developed. Accordingly, the growing significance of early internationalizing firms challenges traditional internationalization perspectives. Thus, in order to obtain further knowledge about the business internationalization process, more specifically oriented and highly systematic research concerning early internationalizing firms is needed (Coviello and McAuley, 1999, Fillis, 2001, Jones and Dimitratos, 2003, Zou and Stan, 1998).
We address this research gap within the emergent but still in its infancy field of international entrepreneurship by identifying and investigating the main literature currently existing on INVs, global start-ups and born-global firms, which are, by definition, international at inception. An INV has been defined as ‘a business organization that, from inception, seeks to derive significant competitive advantage from the use of resources and the sale of outputs in multiple countries’ (McDougall et al., 1994, Oviatt and McDougall, 1994). Similarly, Knight and Cavusgil (1996, p. 11) conceptualize born-global firms as being “small, [usually] technology-oriented companies that operate in international markets from the earliest days of their establishment”. For brevity sake in this paper, we collectively refer to such businesses as ‘early internationalizing firms’.
The present study is focused on reviewing and evaluating the most contemporary academic literature (both theoretical and empirical) concerning these newly established, highly international entrepreneurial firms in order to identify the key empirical findings and suggest further theoretical development to explain this emerging phenomenon.
The structure of this paper is as follows. First, a description of the methodology used for approaching our comparative literature review and analysis is presented. Then, a general assessment of this increasing stream of research in light of our previous literature selection follows. Largely based on the results of this literature review, we also present a new theoretical proposal in the form of an exploratory resource-based model of early internationalizing firms. Finally, several conclusions as well as implications including future research directions are outlined at the end.
Section snippets
Methodology
As this study focuses on the contemporary scientific contributions appearing in the field of early internationalizing firms, the publication time frame covers a fixed period of years (1993–2003, both inclusive). Although some studies on this issue were published earlier (Jolly et al., 1992, McDougall, 1989), a cut-off year was established in 1993. This is the time period within which the vast majority of relevant studies have appeared.
The studies to be considered in this review were firstly
Analysis and discussion of the review results
In order to assess these 38 theoretical and empirical studies as systematically as possible, each study was content-analyzed, with particular emphasis on the following issues: (1) main objective and type of research; (2) theoretical framework/s used for conceptual development and analysis; (3) methodological approach; and (4) key research findings and conclusions. Due to space restrictions, only a condensed presentation of the review results follows.
For addressing our assessment of the reviewed
A new research model on early internationalizing firms
To move this paper a step forward from a purely synthetic review of a selected number of studies focused on early internationalizing firms, in Fig. 2 we also present a new theoretical model that complements other conceptual frameworks recently posited elsewhere (Bell et al., 2003, Zahra et al., 2003), and may help other researchers in developing further empirical work on this issue, whether case-based and/or survey-based longitudinal research.
This model derives essentially from combining two
Conclusion and further research implications
In this paper, 38 of the most well-regarded academic works from the last decade dealing with the phenomenon of early internationalizing firms have been identified and then examined, as a basis for surveying the state-of-the-art of this research stream in the young and very promising scientific field of international entrepreneurship (Acs et al., 2003, Christensen, 2003, Young et al., 2003). On the basis of this literature review, a critical assessment of the most relevant benefits and
Acknowledgements
The authors wish to thank professors Sharon Thach, Pavlos Dimitratos, and Jorma Larimo for their comments to earlier versions of this paper. Also, comments from the two anonymous reviewers of IBR are acknowledged.
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