Strategic Commitment and Timing of Internationalization from Emerging Markets: Evidence from China, India, Mexico, and South Africa

Abstract

In a study of 257 new ventures from China, India, Mexico, and South Africa, we find support for the mediating effect of strategic early internationalization on international sales intensity. We argued that when new ventures from emerging markets internationalize early and with commitment, the legitimacy they acquire helps them overcome liabilities of newness and foreignness. We develop a typology of international new ventures that, based on strategic intent and timing of internationalization, distinguishes strategic early internationalizers from persistent, serendipitous, and long-term internationalizers. We show that strategic early internationalization accounts for over half of the explained variance in international sales intensity and either fully or partially mediates the effects of managerial knowledge and market orientation on international sales intensity.

Networks, Entrepreneurial Orientation, and Internationalization Scope: Evidence from Chilean Small and Medium Enterprises

“…Within emerging markets, there is also a great disparity in terms of coverage: most empirical evidence tends to focus on the so‐called BRICs (Brazil, Russia, India, and China), and more specifically on China and India, whereas other economies, and especially Latin American and African economies, are grossly underrepresented in the international business and entrepreneurship literature (Wood et al. ). On the other hand, Kuivalainen, Sundqvist, and Servais () point that it is important to verify whether and why firms expand internationally only within a specific region, or whether they have a globally diversified client portfolio.…”

“…; Wiklund and Shepherd ; Wood et al. ). Especially for small firms, each new market entry is an entrepreneurial act, which involves risk taking , innovation , and a proactive behavior (see Ellis ).…”

“…There is empirical evidence that the more firms internationalize proactively, with entrepreneurs committing themselves and their resources to it, the more likely they are to internationalize quickly and to a diverse range of territories (Rasmussen, Madsen, and Servais ; Wood et al. ).…”

“…; Wood et al. ). There is, however, scarce empirical evidence about the effects of EO on the scope of internationalization.…”

Entry mode choices in the international new ventures context. A study from different theoretical perspectives

“…INVs are new ventures that internationalize from the very outset (Oviatt and McDougal 1994), and consequently they usually face important market legitimacy hurdles associated to their youthfulness and early international activity (Wood et al 2011). IE research suggests that the appropriate choice of entry mode can reduce INVs' liability of newness and foreignness (Chen 2006), thus contributing significantly to their market legitimacy (Wood et al 2011) and corporate growth (Gabrielsson et al 2008) in foreign markets during their childhood.…”