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Journal of International Business Studies

, Volume 38, Issue 2, pp 333–352 | Cite as

The survival of international new ventures

  • Ram Mudambi
  • Shaker A Zahra
Article

Abstract

International new ventures (INVs) are a popular mode of entry into foreign markets. INVs, those companies that enter foreign markets at inception, often suffer the two liabilities of newness and foreignness, which may increase the odds of their failure. This paper empirically examines the survival of INVs by comparing them with other sequential modes of international operations (e.g., acquisitions). Data from 275 British firms show that INVs have lower unconditional survival probabilities than other modes of foreign market entry. Our analyses also show that differences in survival probabilities disappear when the firms’ competitive strategies are considered.

Keywords

international new ventures firm survival multinational firms 

Notes

Acknowledgements

We acknowledge the financial support of the School of Business at the University of Buckingham and the project support of the UK Department of Trade and Industry (DTI). We thank David Audretsch, Bo Carlsson, Mark Casson, Tom Kniesner, Eric Rasmusen and seminar participants at the DTI, Case Western Reserve University and Indiana University for helpful comments. We also thank three anonymous JIBS reviewers, as well as Arie Y. Lewin, who is instrumental in significantly improving the paper. The usual disclaimer applies.

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© Academy of International Business 2007

Authors and Affiliations

  1. 1.Department of General and Strategic ManagementInstitute of Global Management Studies, Fox School of Business, Temple UniversityPhiladelphiaUSA
  2. 2.Department of EconomicsUniversity of ReadingUK
  3. 3.Center for Entrepreneurial Studies and Department of Strategic Management and OrganizationCarlson School of Management, University of MinnesotaUSA

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