Employing a sample of 180 entrepreneurial high‐technology ventures based in the United Kingdom, we examine the effects of social capital in key customer relationships on knowledge acquisition and knowledge exploitation. Building on the relational view and on social capital and knowledge‐based theories, we propose that social capital facilitates external knowledge acquisition in key customer relationships and that such knowledge mediates the relationship between social capital and knowledge exploitation for competitive advantage. Our results indicate that the social interaction and network ties dimensions of social capital are indeed associated with greater knowledge acquisition, but that the relationship quality dimension is negatively associated with knowledge acquisition. Knowledge acquisition is, in turn, positively associated with knowledge exploitation for competitive advantage through new product development, technological distinctiveness, and sales cost efficiency. Further, our results provide evidence that knowledge acquisition plays a mediating role between social capital and knowledge exploitation. Copyright © 2001 John Wiley & Sons, Ltd.

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This article addresses a critical issue for entrepreneurs and managers pursuing internationalization strategies: how fi rms can accumulate the knowledge and skills required for successful international expansion. Specifi cally, we examine how young fi rms may compensate for their lack of fi rm-level international experience by utilizing other sources of knowledge. Drawing on organizational learning theory, we develop an integrative framework that looks at the joint and interactive effects of experiential learning by the fi rm, the management team's pre-start-up international experience (i.e., congenital learning), and interorganizational learning from key exchange partners (customers, suppliers, investors, etc.). Utilizing empirical data on 114 young, technology-based fi rms in Flanders, Belgium, we fi nd that a fi rm's level of international experience negatively moderates the effects of congenital and interorganizational learning on the extent of internationalization. That is, the lower a fi rm's experiential learning, the more signifi cant the effects of the start-up team's prior international knowledge base and the knowledge and skills acquired through key partners. These results make important theoretical and empirical contributions to the international entrepreneurship and organizational learning literatures by highlighting some of the factors underlying learning advantages of newness that facilitate the internationalization of young fi rms and by explicating substitutive interrelationships among different learning mechanisms. Copyright © 2010 Strategic Management Society. INTRODUCTIONInternationalization is a complex and uncertain process that poses signifi cant challenges for any fi rm. For young fi rms, the expansion into foreign markets is a particularly important and intricate decision-internationalization is increasingly a competitive necessity for such fi rms, especially in technology-based industries, but resource constraints and liabilities of newness exacerbate the challenges and risks involved (Autio, Sapienza, and Almeida, 2000;Oviatt and McDougall, 1994;Sapienza et al., 2006). Entering foreign environments means that the fi rm's existing knowledge and capabilities are often not applicable, and the fi rm has to develop new knowledge and capabilities in order to succeed Vahlne, 1977, 1990; Keywords: internationalization; young fi rms; organizational learning; interorganizational learning *Correspondence to: Helena Yli-Renko, University of Southern California, Lloyd Greif Center for Entrepreneurial Studies, Bridge Hall One, Los Angeles, CA 90089-0801, U.S.A. E-mail: hylirenko@marshall.usc.edu Oviatt, 1996;Sapienza et al., 2006). Accordingly, international business (IB) research has increasingly zeroed in on the critical question of how fi rms accumulate the knowledge and skills required for international expansion (e.g., Barkema, Bell, and Pennings, 1996;Lu and Beamish, 2004;Nadolska and Barkema, 2007;Petersen, Pedersen, and Lyles, 2008). In addressing this question, the bulk of extant IB resear...

Recent literature has highlighted two conflicting theories of entrepreneurship. In the "discovery" perspective, objective environmental conditions are considered to be the source of entrepreneurial opportunities and thus drivers of subsequent entrepreneurial action. The "creation" view, in contrast, is based on entrepreneurial perceptions and sociocognitive enactment processes. While empirical studies have separately utilized each of these perspectives, few attempts have been made to integrate insights from both theories to empirically examine the interrelationships among environmental conditions, entrepreneurial perceptions, entrepreneurial action, and outcomes. In this article, we explicate the roles that both objective environmental conditions and entrepreneurial perceptions of opportunity and resource availability play in the process of firm creation. Utilizing longitudinal data on nascent entrepreneurs, we find that as hypothesized, entrepreneurs' opportunity perceptions mediate between objective characteristics of the environment and the entrepreneurs' efforts to start a new venture. Contrary to our expectations, we do not find a similar mediating effect for perceived resource availability. These findings have important implications for further theory development in entrepreneurship as well as for practice and education in the field.