Early internationalization and performance of small high‐tech “born‐globals”

Abstract

Purpose The purpose of this paper is to investigate the early internationalization and the performance of small firms in technology‐intensive industries. Design/methodology/approach Using a sample of 278 small US firms in technology‐intensive industries, this paper employs quantitative methodologies to test hypotheses. Findings The findings indicate that such organizational variables as firm size and international experience have a non‐linear, inverted U‐shaped relationship with these firms’ early internationalization. Some strategic variables, such as R&D intensity, have significant impacts, whereas others, such as advertising intensity and strategic alliances, have none. However, the interactions between these strategic variables have a more significant influence upon these firms’ early internationalization than do the individual strategic variables in isolation. Moreover, early internationalization has significant and positive impacts on the performance of these firms. Practical implications The paper’s findings have important managerial implications. The paper identifies the driving forces for the early globalization of small firms and provides useful guidelines for managers to manage these factors in their efforts to maximize firm performance. Originality/value The paper differentiates organizational factors from strategic factors against the background of small “born globals” in technology industries and investigates the interactions among these internal factors and external factors, i.e. the environments of technology industries. Findings of non‐linear relationships among these factors shed light on the strategy determinants of a unique group of small to medium‐sized enterprises and their performance.