On the foundation and early development of domestic and international new ventures
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On the foundation and early development of domestic and international new ventures Erik S. Rasmussen • Tage Koed Madsen • Per Servais
Published online: 25 September 2010 Springer Science+Business Media, LLC. 2010
Abstract The founding and early development of Domestic New Ventures and International New Ventures is examined based upon a large scale survey of Danish manufacturing firms. The firms are classified into five different categories and compared with regard to their foundation and development within the first 3 years. The article contributes with a demonstration of differences between these categories of firms with regard to the number and mindset of founders, the growth of the firm, and the networks of firm. Keywords International new ventures Foundation Early growth Internationalization Manufacturing firms
1 Introduction During the last decade there has been an increase in the interest for research combining the internationalization of the firm and entrepreneurship, i.e. the founding process of International New Ventures (INVs). This interest can be seen in a number of review articles as in e.g. (Autio 2005; Zahra 2005; Dimitratos and Jones 2005; Rialp et al. 2005; Aspelund et al. 2007; Keupp and Gassmann 2009). In the literature several case studies of INVs has appeared, but so far only few large scale studies have been conducted with the purpose to compare the founding process and This paper has been presented in the 10th IB (International Business) Conference in Vaasa Finland, August 2009, and has been selected among the works submitted to the JMG fast track on ‘‘Corporate Governance and Internationalisation’’, chaired by Jorma Larimo (Conference chair and University of Vaasa), Antonella Zucchella (University of Pavia) and Per Servais (University of Southern Denmark). E. S. Rasmussen T. K. Madsen P. Servais (&) Department of Marketing and Management, University of Southern Denmark, Campusvej 55, 5230 Odense M, Denmark e-mail: [email protected]
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early development of the highly international firms with that of e.g. local or slowly internationalizing firms. This article attempts to fill this gap by presenting a large scale study of manufacturing firms in Denmark. The founding process of different types of firms is analysed and it is investigated how they develop within the first 3 years after their inception. Besides this contribution the article develops a typology of firms—from the most domestic firms to the most international firms. The article thus expands the comparison by Westhead (1995) of exporting and non-exporting firms. To do this we supplement the definition of ‘international’ from highlighting only export activities (Knight and Cavusgil 1996) to include two types of international activities—sales and sourcing as suggested by Oviatt and McDougall (1994). Drawing on the resulting typology we demonstrate significant differences in the founding process and early development of different types of firms.
2 Defining (International) new ventures Early re
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