Global Corporate Ventures: A New Trend of International Corporate Entrepreneurship

Abstract

Two hot topics today in the popular press as well as academic literature are international entrepreneurship and corporate entrepreneurship. These topics challenge two traditional notions within those fields: the difficulty of established corporations to be entrepreneurial and the difficulty of entrepreneurs to go global. The current study introduces the concept global corporate ventures, which merges the concepts internal corporate ventures and "born globals." This concept is developed and illustrated by two examples of global corporate ventures-ING Direct and HSBC Direct, two financial services e-commerce ventures that have been launched on a global scale.

International Corporate Entrepreneurship With Born Global Spin-Along Ventures — A Cross-Case Analysis of Telekom Innovation Laboratories' Venture Portfolio

“…The more independently a venture acts, the lower is the likelihood of receiving proper access to corporate resources and vice versa. However, more access to resources is linked with stronger parental monitoring which hinders entrepreneurial freedom of the venture (Callaway, 2008). This notion is in line with Burgelman's (1984) assessment that ICV top management "should learn to assess better the strategic importance of ICV projects to corporate development and their degree of relatedness to core corporate capabilities" (p. 44).…”

“…Moreover internationalisation plays an increasingly important role in corporate entrepreneurship (Hoskisson et al, 2011). Callaway (2008) linked the concept of born globals with ICV. By presenting examples of ING Direct and HSBC Direct he showed how two large financial service companies were able to create international ventures via internal corporate venturing.…”

“…Innovations introduced by global corporate ventures are often niche products or platform technologies which require a global reach to be successful. Internal ventures may internationalise early, regardless of the degree of internationalisation of the corporate parent and can therefore, become a vehicle to internationalise the parent itself (Callaway, 2008). Furthermore, global corporate ventures face a tradeoff between independence and access to parental resources.…”

“…Additionally high-technology ventures in the ICT industry can specifically benefit from network effects. Global corporate ventures that are able to scoop network effects and achieve technological lock-ins have the chance to increase internationalisation speed (Callaway, 2008) and thereby set de-facto standards (Wurster, 2011).…”

“…Callaway (2008) linked born global research with the concept of internal corporate venturing (ICV) and presented "global corporate ventures" as measures to quickly internationalise internal corporate ventures.…”