Research summary: Based on the RBV and dynamic capabilities, this study explains the relationship between alliance formation and the private (pre-IPO) entrepreneurial firm's market performance. Findings show that while alliance formation positively and significantly affects the market performance of venture-backed firms in the software industry, forming a comparatively large number of alliances hurts these firms' market valuations.Managerial summary: Entrepreneurial firms are better off entering a select number of strategic alliances and focusing on enhancing the outcomes of those select alliances as well as developing a dynamic alliance management capability. Such firms benefit most from establishing a moderate number of alliances rather than depending on a small number of alliances or becoming overwhelmed with a great number of alliances.
Purpose
Transnational entrepreneurship can be considered a new stream of research where migrant entrepreneurship and international business research fields intersect. The purpose of this paper is to offer a theoretical framework to address the following research question: How do transnational entrepreneurs (TEs) develop their competitive advantage to succeed in a global market?
Design/methodology/approach
Based on the strategic entrepreneurship approach and dynamic capability perspective, this paper suggests a theoretical framework to extend the understanding on how TEs may develop their competitive advantage to succeed in a global market.
Findings
The suggested theoretical framework exhibits how the social ties of TEs affects their firm performance through the mediating effect of a bundle of two organizational processes (opportunity sensing and opportunity seizing) and the moderating effect of institutional distance between countries of origin and residence.
Practical implications
TEs should not solely focus on their ethnic social ties. That is why this paper suggests that ethnic ties in the country of origin and the country of residence (COR) may lead to higher firm performance only if systematically used alongside nonethnic ties in the COR. Furthermore, it is crucial for TEs to understand the importance of dynamic capabilities in developing and sustaining their competitive advantage.
Originality/value
Based on the strategic entrepreneurship approach, this paper suggests a social tie-based model of the dynamic capability to address the theoretical void in the transnational entrepreneurship literature. The linkage between social tie and performance which has been in a black box is examined in terms of how strong and weak social ties may affect different underlying processes of TEs’ dynamic capabilities differently. In contrast to the common conceptualization of institutional distance as a negative moderator in international business literature, institutional distance is theorized as a positive moderator in the suggested theoretical model of transnational entrepreneurship.
Research Summary: This study employs textual coding techniques to investigate 25 creation and discovery opportunities using entrepreneurs' start-up interviews. Based on Austrian economics and social constructionism theoretical arguments, we identified four casual conditions: social bonds, social bridges, prior knowledge, and past start-up experience. These causal conditions are analyzed using qualitative comparative analysis. Results indicate that creation opportunities are associated with social bonds, prior knowledge, and lack of prior entrepreneurial experience. Alternatively, discovery opportunities are associated with prior knowledge, social bonds, and social bridges. Our empirical findings demonstrate the differences in social and human capital configurations associated with forming creation and discovery opportunities. Managerial Summary: In an effort to better understand how creation and discovery opportunities arise, we investigated and compared likely factors including: close relationships, distant relationships, prior knowledge about related markets and industries, and past start-up experience. Results show that creation opportunities are associated with close relationships, prior knowledge about related markets and industries, and lack of prior entrepreneurial experience. Discovery opportunities are associated with prior knowledge about related markets and industries, close relationships, and distant relationships. Our findings begin to describe how different types of opportunities are realized. Specifically, particular forms of human and social capital may be needed for generating differing types of opportunities.
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