Network-based and knowledge-based conditions are widely regarded as important antecedents to international performance among new venture Born Globals (BGs) and their counterpart late internationalizing small and medium-sized enterprises (SMEs). Yet, while studies have examined the single effects of these ingredients on BGs’ and late internationalizing SMEs’ international activity, a configurational approach is still missing. How do network-based and knowledge-based factors matter for international performance and do they share the same importance for both types of firms? To address these questions, we apply for the first time a fuzzy set qualitative comparative analysis (fsQCA) on data from managers and founders of 365 international German, Austrian, Swiss, and Liechtensteinian companies, mapping configurational paths that lead to high international performance. The results demonstrate that late internationalizers do not share the same paths as BGs for high international performance, except in one instance. We find four causal configurations for BGs and three for late internationalizing SMEs. Results show that while both groups of firms rely on network size, BGs rely much more on collaboration intensity as well as international market knowledge and education.

Introduction

An increasing number of start-up firms, often Business-to-Business ventures (Laanti, Gabrielsson, & Gabrielsson, 2007; Sepulveda & Gabrielsson, 2013), initiate their international activities very soon after founding (Jones, Coviello, & Tang, 2011). These Born Globals (BGs) represent over 18% of European new ventures (Mandl & Celikel-Esser, 2012) and have become a focal point for research over the past twenty years (Jones et al., 2011; Keupp & Gassmann, 2009; Rialp, Rialp, & Knight, 2005). Firm age at the point of internationalization can materially affect international performance (Sapienza, Autio, George, & Zahra, 2006; Zahra, 2005) because it varies the severity of a firm’s liabilities of foreignness. This places the entrant firm at a disadvantage compared to local competitors (Schwens & Kabst, 2009). BGs, further possessing significant international market knowledge shortages described as liabilities of newness, would be expected to be at even greater disadvantage (Zucchella, Palamara, & Denicolai, 2007). For these reasons, networks can be powerful means for the development, growth, and performance of BGs (Sepulveda & Gabrielsson, 2013) at start-up (Coviello & Cox, 2006) and beyond (Hoang & Antonicic, 2003). Networks represent connections developed between a set of actors (either as individuals or firms) (Brass, 1984; Coviello & Cox, 2006). Managers must act purposefully to determine and coordinate the flow of knowledge from network relationships in a way that does not leave it to chance or happenstance (Håkansson & Ford, 2002). To do this, the BG firm must bring together network-based and knowledge-based factors.