A comparative study of international and domestic new ventures.

Zusammenfassung

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RESEARCH ARTICLE

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A comparative study of international and domestic new ventures.

Abstract:

* This paper draws on theories of the SME internationalization process to compare profiles of international new ventures (INVs) and domestic new ventures (DNVs).

* The work documents the incidence of INVs through a large survey of small- and medium-sized enterprises.

* INVs operate across all sectors. Exporting is as common among new firms as among established firms regardless of sector. No gender differences in ownership between the international and domestic cohorts were observed. Compared to domestic firms, INV owners are more experienced, growth-oriented, and are disproportionately more likely to be owned by recent-immigrants.

Keywords: International new ventures * Internationalization * Exporting * Network theory

Introduction

The objective of this study is to add to the understanding of exporting among early-stage small- and medium-sized enterprises (SMEs). It draws on a large-scale, representative sample of SMEs to examine the incidence of international new ventures (INVs) and compares, between international and domestic new ventures (DNVs), owner and firm characteristics.

Zahra (2005) notes that early-stage exporters were, until recently, overlooked within research. The existence of early-stage exporters raises questions about the widely-accepted stage theory of the internationalization process, a theory that suggests international expansion is a gradual process based on incremental knowledge acquisition (Bilkey and Tesar 1977; Johanson and Valhne 1977; Johanson and Wiedersheim-Paul 1975). Moreover, INVs may collapse or skip stages of growth (Luostarinen and Gabrielsson 2006). Yet, across many OECD (Organization for Economic Co-operation and Development) countries public policy assumptions about "export readiness" and viability have been rooted in stage theory. There are also a predominance of stimulation programs targeted at goods producers and technology-based firms (Clendenning 2006). Accordingly, INVs challenge the underlying basis and relevance of many export programs and policies.

Research on INVs has focused primarily on the inception process of firm development, and has reported on pre-conditions, driving forces and strategies of early internationalization (Autio 2005; Dana et al. 1999; Knight and Cavusgil 1996; McDougall 1989; Oviatt and McDougall 1994, 1997; Reuber and Fischer 1997). Most studies are based on small, descriptive or qualitative samples and are often limited to manufa...

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