This study examines the effect of founders’ immigrant status on the survival and growth of high technology international new ventures. We draw on the behavioral theory of the firm and argue that immigrant entrepreneurs venturing abroad may perform better due to their experiential knowledge and understanding of setting up and running businesses in their country of adoption. Native entrepreneurs, on the other hand, start their businesses in their native countries and may therefore lack tacit understanding and routines about managing international efforts. Therefore, we hypothesized that immigrant-founded international new ventures will (1) have a higher probability of survival and (2) have higher rates of growth than native-founded international new ventures. We test our hypotheses using data from the Kauffman Firm Survey on 134 newly founded international high technology ventures in the U.S. Surprisingly, our results show that international high-tech new ventures with outsider founders are less likely to survive and grow relative to their native-founded counterparts. We speculate that immigrant entrepreneurs tend to be overconfident in their own ability to internationalize successfully.
Yavuz, R. Isil; Sapienza, Harry J.; and Zaheer, Sri
"FOUNDERS’ IMMIGRANT STATUS, EARLY INTERNATIONALIZATION AND PERFORMANCE IN HIGH TECHNOLOGY INDUSTRIES,"
Frontiers of Entrepreneurship Research: Vol. 32
, Article 2.
Available at: http://digitalknowledge.babson.edu/fer/vol32/iss16/2