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3 Methodology
In order to ascertain key drivers and challenges for the internationalization of BG firms, a qualitative
approach was used. According to Yener, Dogruoglu and Ergun (2014), “there has been little research into
internationalization of SMEs. Most research tries to answer the ‘what’ questions. These are achieved through
surveys. The ‘how’ and ‘why’ questions are not as common and these require case studies and qualitative
research instead of quantitative research”. Moreover, the qualitative approach provides more flexibility as
problem statement, study design, data collection, and data analysis may change during the research process.
Further advantages that lie within the execution of a qualitative approach are obvious: “The final written report
[…] includes the voices of participants, the reflexivity of the researcher, and the complex description and
interpretation of the problem and it extends the literature or signals a call for action” (Creswell, 2007, p. 37).
Diverse authors emphasize that the majority of BG research takes place within knowledge-intensive
service firms, investigating mainly service, software, and technology- and internet-based companies (Lopez,
Kundu & Ciravegna, 2009). Therefore, the unit of analysis of this research are companies fitting the classical
BG framework of having internationalized or are most likely to internationalize within the first three years after
their inception that offer eservices with the internet as their distribution channel. Data for case study was
collected through semi structured interviews with managers from four of these companies whom were chosen
based on the extended personal network of the authors (convenience), as a previous random approach was
unsuccessful. The advantage of semi structured interviews lies in its flexibility which is crucial to answer the
intended “how” and “why” questions “to explore more complicated research questions. Because the semi-
structured interview is such a versatile means of collecting data, you can […] develop a much deeper
understanding of the research question by exploring contradictions within your participants´ accounts” (Fylan,
2005, p. 66-67). The interviews were conducted online and recorded for further analysis at the end of April 2016
(Table 1). The first interview was held with the marketing manager and business developer Alexis Gourdol of
Tripda, hired right after the company was founded, May 8th 2014. The remaining interviews were conducted with
the founders of the respective companies.
Table 1: Overview of interviews conducted
Interviewee position Company Country Period Duration
1 Marketing Manager Tripda Brazil 04/2016 109 min.
2 Founder/CEO parcelLab Germany 04/2016 33 min.
3 Founders NOYS Germany 05/2016 54 min.
4 Founder/CEO linkbird Germany 06/2016 48 min.
Data was analyzed using simple categorization and further comparison, interpretation, and composition,
in accordance to a structured qualitative content analysis, “a careful, detailed, systematic examination and
interpretation of a particular body of material in an effort to identify patterns, themes, biases, and meanings”
(Berg, 2007, p. 303). According to Jauch, Osborn and Martin (1980), this type of analysis is mostly common in
history, journalism, and anthropology, but finds its way into organizational analysis as well as it provides valuable
information when the researcher seeks to incorporate a broad range of various conditions with the organization
being the unit of analysis. Patton (2002) further specifies qualitative content analysis as “any qualitative data
reduction and sense-making effort that takes a volume of qualitative material and attempts to identify core
consistencies and meanings”. Such qualitative data can be texts or speeches with emphasis on their specific
contexts (Zhang & Wildemuth, 2009).
4 Results and Analysis
4.1 Case 1: Tripda (Brazil, 2014-2016)
Tripda, a long-distance ride sharing platform based in São Paulo, Brazil, was founded in May 2014.
Initiated by the German internet incubator Rocket Internet, which is also in charge of other similar successful
companies like Easy Taxi or Zalando, Tripda’s mission was to make car-sharing a viable, mainstream and safe
method of transportation for private persons around the world, an additional choice among train, plane, or bus.
People in need to get from one place to another usually have limited options that are either inconvenient, time
consuming, or very expensive. Tripda provided a more economical, practical, environmentally-friendly, and
social solution for people to travel as it matched drivers and passengers in the same route to offset the travel
costs. Tripda monetized this concept by charging a small commission fee on each trip as it offered a carpooling
website and a platform with mobile applications connecting drivers and passengers. More than that, Tripda
defined itself as a carpooling community in which they could meet and exchange. In two Series A investments
rounds, they were able to gather more than US$17 million in funding.
Until operations were shut down in April 2016 due to high operating costs, Tripda employed more than
100 people in 13 different countries (Brazil, Argentina, Colombia, Chile, Mexico, Uruguay, Singapore, Malaysia,
the Philippines, Taiwan, the United States, India, and Pakistan) and helped more than 1 million travelers to find
rides. The criteria chosen by Tripda to enter those predominantly emerging markets were population,
infrastructure, and geographical characteristics (two large cities with a minimum of 100.000 inhabitants in the
radius of 600 km to each other as an indicator for the propensity of people to commute). Because Tripda was
launched globally since its inception, the firm is qualified as a BG, even though the domestic market represented
approximately 60% of its total revenue.
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Upon inception, the Tripda brand was weak. It is very difficult to achieve brand recognition within a few
months and the company did not invest on traditional advertising media channels. It focused on one particular
target group of Brazilian consumers that met their criteria and had the potential to become brand ambassadors:
students who have a short budget, but still want to travel or commute. Among them, Tripda became a strong
brand very fast. In order to implement the “ambassador” approach and carry it out to a greater reach and
strengthen the brand, the intended carpooling communities were the most important feature. This is why Tripda
needed some degree of local operations to build these communities and strengthen them in order to attract new
users. They first started recruiting country managers, who ran the local operations in the respective foreign
markets. Within 6-7 months, by January 2015, employees were already set up in the countries to build and
engage users’ communities. They further engaged in informal partnerships with local companies in order to
enter foreign markets and increase brand awareness.
4.2 Case 2: parcelLab (Germany, 2015 – present day)
ParcelLab is a young company from Munich, Germany, that shares the vision to enable all online shops
worldwide to never again cope with negative shopping experiences caused by bad deliveries and thus contribute
to the highest possible customer satisfaction. Therefore, a team of logistics, e-commerce and IT experts among
the CEO Tobias Buxhoidt started the company in February 2015 to offer a high-quality service in the field of
data analysis and prediction as well as customer loyalty programs for delayed deliveries.
Together with the two other founders, Anton Eder, COO, and Julian Krenge, CTO, the company tripled
their headcount and built a team of nine employees up-to-date as well as an additional supportive network of
mentors. The core parcelLab feature is the cloud based software as a service (SaaS) technology that tracks
shipments of 250 carriers worldwide and is offered business-to-business (B2B) for online shops and companies
within the e-commerce sector on a monthly subscription based model. By digitalizing the delivery process and
collecting non-personal data, parcelLab created transparency, automatically identifying and predicting delays in
the delivery process, and can inform customers of the respective online shop about it in advance. This is an
unsolved problem for online shops worldwide. The service is possible due to big data analysis on openly
available data from the logistics companies. They combine this issue identification with adaptive and fully-
automated customer notifications and, and thus, enabling online shops to ensure a positive shopping
experience.
The original idea of CEO Tobias Buxhoidt was to sell special delivery windows so customers would not
have to deal with the anxiety of not receiving an expected parcel when they are not at home. Investors suggested
it would be a good idea to make such deliveries more predictable in order to solve the existing customer distress
from another angle. From that moment on, the original business model was fully changed and parcelLab was
born. In nine months, he and the other founders created a profitable business with 30 customers, partnered with
leading e-commerce and logistics associations, and are currently prepared for internationalization. So far, they
have received support and coaching from the SpeedUp Europe accelerator, Google LaunchPad, and the AWS
Activate Program.
The first sale abroad resulted in Switzerland six months after foundation in February 2016 making up
not more than 3 per cent of their total revenue and, therefore, is not significant. But nothing much more has
happened internationally ever since. For the next two years, the company wants to focus its expansion strategy
to the largest e-commerce markets around the globe being the United States, the United Kingdom, and Japan,
besides their actual efforts in the close markets of Austria and Switzerland with the help of the existing expertise
of their network.
4.3 Case 3: NOYS VR (Germany, 2014 – present day)
NOYS VR is a start-up from Hamburg, Germany initiated by two friends Fabio Buchheri and Fatih Inan,
both 25 years old. As they both share a passion for music, they wanted to revolutionize the way music lovers
can experience live concerts of their favorite artists around the world with virtual reality. NOYS is a platform that
gives artists the opportunity to perform their music and hold live concerts in virtual environments whereas live
music listeners and fans around the world can attend these performances by watching it from home via app.
They follow a sophisticated B2B/B2C model that has to acquire both artists or their respective management as
well as booking agencies on the business side and music lovers that can sign up for licenses in a subscription
based model in order to get access to the platform on the consumer side. Once they have signed up, consumers
are supposed to find themselves in a music landscape of different genres where they can call in and attend
concerts currently taking place, via livestream. The live music sector has evolved to be the main source of
income for many artists and musicians over the past few years. Therefore, NOYS is primarily a tool for aspiring
professional musicians enabling them to become financially independent and flexible in order to provide them
more creative space. They want to give young artists the opportunity to perform at an early stage of their careers
at a low cost, because it is usually rather difficult to get first bookings for such artists as they have not made
their name for themselves yet. Their aim is to advance their platform to that degree that everybody can host
such concerts from their own homes. Before this is achieved, they intend to collaborate with famous artists with
whom they want to host exclusive concerts for the NOYS audience.
The idea itself to connect music and virtual reality was developed in their bachelor thesis starting from
September 2014 which ought to serve as a theoretical elaboration and groundwork for the later intended
company foundation. Because they were so convinced of the relevance of this case, they could also convince
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both their universities in Hamburg, where Fabio studied media management, and Schwäbisch-Gmund, where
Fatih studied information sciences, to allow a collaborative work that had not existed between those institutions
so far back then. The founders are passionate about their solution and share the vision to be the number one
platform for digital live music by providing artists a sophisticated and unprecedented technological toolset to
promote themselves and encourage users to return to active and social music experiences. The service is
furthermore based on the assumption that virtual reality (VR) glasses will be marketable in the future.
4.4 Case 4: linkbird (Germany, 2011 – present day)
Linkbird is a start-up based in Berlin, Germany, founded in 2011 by the now CEO Nicolai Kuban and
his co-founder and now CTO Bastian Bickelhaupt. It is a software-as-a-service (SaaS) tool that supports online
marketers and agencies as well as companies that have their own online operations to follow their visibility and
increase the organic traffic through search engine optimization (SEO), links, content and online public relations
(PR). In order to do so, Kuban and Bickelhaupt have developed the content marketing software linkbird that
connects workflows for teams on a platform with integrated analysis to enable companies to attain customers
with content marketing and position themselves as experts for their respective target groups. Their customers
are in the B2B segment with the focus either on marketing agencies or B2C-oriented companies that have their
own content marketing division of at least three employees in their marketing department.
In February 2013, linkbird received an undisclosed amount of venture capital by the German VC High-
Tech Gründerfonds which is known for providing a maximum of €2 million per company they invest in (BMWi,
2016, p. 2). Before linkbird, Kuban and Bickelhaupt already founded together several online shops and e-
commerce companies, including ‘The Feedback Company’ eKomi, Europe’s first and largest independent
provider platform for transaction-based customer reviews and ratings in order to recommend online shops
regarding their customer orientation. Since their first business creations in 2008, they assign the company roles
the same way: whereas Bastian Bickelhaupt is responsible for product and software development, Nicolai
Kuban manages marketing, sales, finance, and strategy.
The platform was online and ready-to-market in 2012 with the first foreign sales originated in Spain in
April 2012. Kuban describes the first international deal as a pure luck as the Spanish company approached
them without any active acquisition by linkbird. After this sale, nothing happened significantly for a long time
until they started to receive regular revenue streams from abroad from September 2013 on. Inbound leads
approached linkbird almost from inception, but this increase in particular, Kuban believes, is due to the
increasing international sales campaigns executed in the Netherlands around that time. Today, they generate
approximately 30% of their total revenue are from abroad involving countries such as Australia, Argentina,
Austria, Brazil, Belgium, Canada, Denmark, the United Kingdom, France, Finland, Italy, Israel, Ireland, India,
Sweden, Switzerland, Spain, Netherlands, Poland, Marocco, Malta, Singapore, and USA.
Tripda and linkbird are BGs by definition due to their time to internationalization after inception and
percentage of revenue streams coming from abroad. NOYS and parcelLab aren’t yet, but have shown potential;
thus, they are suitable to be included in this research so that drivers and challenges may be assessed at an
early stage.
4.5 Entrepreneurial Drivers and Challenges
In terms of entrepreneurial drivers, the literature focuses mainly on the persons behind BG itself, i.e.,
the founders’ sophisticated capabilities as well as their experience, their existing network and their overall vision
(Knight & Cavusgil; Kuivalainen, 2001; 2004; Laanti, Gabrielsson & Gabrielsson, 2007; Madsen & Servais,
1997).
Concerning the global vision, all four cases show similar patterns: every interviewee refers to their firm
as designed around a globally envisioned business model aimed at an international client base since the
company’s inception, and this includes parcelLab and NOYS in their early stages. Although linkbird did not
undertake active steps concerning this movement, the business itself was designed in such a way so that is
able to quickly respond to international demands. Even the co-founders of Tripda could only have obtained
proper financing if they were to build up a global organization. Furthermore, personal passion for the business
and professional background are highly relevant as all cases show. In terms of educational background, the
founders of linkbird do not fit into the pattern as both did not attend university. They rather showed
entrepreneurial skills at a very early age managing their own projects during high school, and learning
management with the aid of mentors and coaches. Hence, higher education is certainly not a requisite for
entrepreneurial success and internationalization. Alternatively, network ties play a more important role for
knowledge acquisition, even though a higher education experience may be a fertile ground for critical learning
and network building. The literature review evidences the lack of resources as one of the main challenges of
BGs (Knight & Cavusgil 2009; Luostarinen & Gabrielsson, 2006; Oviatt & McDougall, 1994; Rennie, 1993). It is
suggested that this challenge might be overcome with the foucapabilities and networks of the founders as well
as their respective work force. But, staffing in order to find qualified employees might become a further challenge
due to the illustrated financial limitations (Madsen & Servais, 1997).
Furthermore, their newness hinders access existing networks (liability of outsidership) on which they
can fall back immediately (Dhia, 2015). As the business of all the investigated companies is knowledge-
intensive, human capital is a main resource. In fact, the mindset of Tripda, after which hiring the right people
was one of the core milestones, underlines the importance of it. The explained recruiting difficulty becomes
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obvious when one compares the case of Tripda with the other three companies: whereas parcelLab, NOYS,
and linkbird all admit that they struggle with the issue to find and attract qualified employees, Tripda already had
a funding of several millions of dollars that enabled them to offer the monetary incentive to attract applicants.
But all four companies agree that besides that, especially their vision and “hands on” mentality to build
something are the main points to attract prospective employees as such opportunities usually are not offered
by more traditional companies.
Concerning the establishment of valuable networks, all companies struggled at some point. Whereas
parcelLab, NOYS, and linkbird only had a few international network connections, Tripda could nurture from the
international network and experience from their company builder Rocket Internet. They only had problems
establishing the right partnerships abroad at first. The other three cases participated in accelerator programs
where they have received mentoring and coaching to get general business knowledge into the company, but
not with an internationalization focus, since they still lack sufficient networks abroad. The three further show that
those networks are crucial in order to deal with their limited headcounts. In summary, the discussion about the
entrepreneurial drivers and challenges shows the importance of capabilities and knowledge and how to manage
them. To possess both, one can either fall back on hiring people to get knowledge into the corporation or acquire
it via business networks. Due to the given constraints, networks seem to be a more effective alternative but it
should be established in advance.
4.6 Economical Drivers and Challenges
The economical drivers for BG firms are of both external and internal nature: externally, changing market
conditions as well as a too small domestic market base to serve it exclusively for usually niche oriented business
models as well as the degree of internationalization of their respective business sector enables and stimulates
businesses to go abroad (Gabrielsson & Kirpalani, 2004; Knight, Bell & McNaughton, 2001; Knight & Cavusgil,
2009; Madsen & Servais, 1997). Internally, the product/service itself shows distinctive features that allows it to
be offered worldwide enabling further economies of scale on an international base. This goes in hand with the
technological, cultural, and institutional drivers and cannot be viewed apart from them (Oviatt & McDougall,
1994). Because of their size, BGs can be referred to as SMEs, that have an advantage over large corporations
concerning flexibility, adaptability, and responsiveness to presented changing market needs (Halldin, 2012). A
distinctive feature of the solutions of parcelLab, NOYS, and linkbird is their scalability. Especially, linkbird is
highlighted as its founder points out that the company could internationalize further with its existing structure.
According to him, firms that have a lean, good product are able to internationalize easily due to globalization. In
this context, the argument of parcelLab’s CEO is that almost no business model is only restricted to a single
domestic market anymore is relevant. On the other hand, Tripda was shut down due to high operational costs
which brings questions about the true degree of scalability of the business model. Concerning the hypothesis
of a too small domestic market that forces BGs to internationalize, the four cases show different results. Tripda
and linkbird could have both survived by their revenues in the home market alone. parcelLab has grown
organically, but it has reached its limits in the German market and is dependent on creating revenue from
abroad. It is unquestionable that they are all set in their niche. But in the example of parcelLab, NOYS, and
linkbird, their respective niches are international. Tripda on the other hand had to fight with its approach as it
was limited to the respective local markets where they operated. But what all companies have in common is
that they chose markets with the most relevant business prospects as targets to be entered next. Nevertheless,
from the conducted research, scalability only seems to be a means to an end as it is mainly used as a reason
to attract investors as all four companies rely on it in order to carry their solutions into international markets.
Based on the results of the entrepreneurial challenges, the lack of financial resources has to be
emphasized as probably the main economical challenge BG firms (Knight & Cavusgil 2009; Luostarinen &
Gabrielsson, 2006; Rasmussan, Madsen & Evangelista, 2001). From an economic standpoint, BGs lack above
all time and financial resources, but their newness and absent brand image further hampers immediate
advantages that established companies usually benefit from (Moen, 2002; Zahra, 2005). As the founder and
CEO of parcelLab mentioned, “internationalization costs”. The founders of NOYS, agree with this argument
when they say “everyone can internationalize with a high budget”. That is why each of the four investigated
companies has intensified efforts to attract investors in order raise funding with which they intend to accelerate
their growth. The case of Tripda further shows that even after funding, this challenge persevered. After funding,
they were obligated to achieve a certain level of growth by their investors. As this could not have been met and
the operational costs still exceeded actual revenues, Tripda was shut down. Nevertheless, the approach of
Tripda underpins those two statements; as Tripda was financed by Rocket Internet to execute a trial and error
approach for their concept. This special case stands for the investor perspective where quick scaling is critical
in order to achieve high ROI. All companies focused on onboarding investors to overcome their financial
limitations. parcelLab was bootstrapped for a long time but in order to expand abroad, it is important for them to
set up an effective marketing and sales strategy. But marketing and sales are costly and need to involve
resources as the solution itself has to be brought into the market first. Such costs occur well in advance of any
revenues and, therefore, call for financing. Even Tripda was focused on raising money first before they executed
their approach. But with the support and funding of Rocket Internet as both stakeholder and shareholder,
operations ran easier. The same situation will affect NOYS in the future: the only chance they have is to convince
future investors about the company potential and the future market they are going to create with it. Although
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Gallup (2007) states that the main challenge in the internationalization of SMEs is the lack of foreign market
knowledge, this research clearly points out that the financial limitation is the main challenge that has to be
overcome first. But this can be overcome if sufficient funding is guaranteed. This usually happens when a
company provides either a unique product or business model that has the potential to scale worldwide in order
to increase shareholder value. The inclusion of investors is indispensable. Accordingly, it is relevant to relate
the internationalization process of BGs to the role and influence of external investors.
4.7 Technological Drivers and Challenges
The advances of ICT and further technological developments in the areas of production, transport, and
communication as well as the possibilities offered by the internet are the most relevant technological driving
forces for the internationalization of a BG firm. On the one hand, this trend enables the specified e-services and
SaaS business models that are especially focused in the cases studies. On the other hand, this technological
development enables and increases an individual’s productivity to cooperate across borders and execute his
respective businesses abroad (Bell & Loane, 2010; Loane, 2005; Madsen & Servais, 1997). Furthermore, the
product or service offered by a BG firm has characteristics of technological product innovations as competitive
advantage and a unique selling proposition (USP) in order to distinguish itself and be able to respond to
changing market conditions (Gabrielsson & Kirpalani, 2004; Knight & Cavusgil, 2009; Kudina, Yip & Barkema,
2008; Laanti, Gabrielsson & Gabrielsson, 2007; Madsen & Servais, 1997).
All the examined firms are service-oriented and none of them could offer a service without the internet.
Here, Kuban’s assessment that it is rather easy for SaaS companies to internationalize due to the internet as
enabling force reflects the situation best. All four companies further praise the opportunities given by advanced
ICT and the internet to execute their businesses and cooperate internally with each other more efficiently. The
four cases altogether show ICT connects distant teams, makes up for a small headcount due to the possibility
to automate workflows and eliminate time-consuming manual work and, therefore, increases motivation as well
as it enables the whole organization to learn from each other and exchange data and information as knowledge
and continuous learning are crucial core competencies of BGs. Because of those characteristics, it makes it
even obsolete for parcelLab, NOYS, and linkbird to open international subsidiaries as they are able to execute
their international business from their headquarters in the respective domestic market. Tripda is a different case
as their goal was to respond with a physical presence to local demands. But even their case of the weekly calls
shows how ICT fosters best practice sharing and collaboration. Finally, parcelLab, NOYS, and linkbird share
one thing in common: their offered solution is so unique that they are creating a whole new market within their
business sector. This gives them a first mover advantage to attain market share before competition arises and
is an incentive in order to attract investors that are interested in future business potential and further success.
Gourdol states that Tripda as a service itself was not highly unique and R&D was a weakness, whereas the
innovation lied in the local adoption to make carpooling a service adopted by a mass market. Here it may be
questioned if the lack of uniqueness prevented Tripda to prevail against the competition, such as Blablacar.
NOYS on the other hand brings together two different streams where the combination of the idea with technology
has the potential to disrupt the live music sector.
Contrary, the literature identifies ascending complexity due to technical novelties as challenge within
the technological object of investigation (Alberts & Papp, 1997). The research does not show a clear result
towards or against this hypothesis. The only tendency can be given in the case of NOYS as they are still at a
very early stage of the technological development in their sector. Tripda had its weaknesses concerning R&D
and, in the case of parcelLab, only challenges are evident as their solution may be easily copied in the future.
The discussion about technological drivers and challenges for the internationalization of BGs evidences
technology and innovation as the main drivers to achieve competitive advantages in international markets
besides entrepreneurial orientation.
4.8 Cultural Drivers and Challenges
The literature identifies changing market conditions alongside the effects of globalization as cultural
drivers for the internationalization of BG firms as they enable and facilitate operations abroad; a consequence
of this trend is increasing social change and cultural homogeneity of culturally distant markets (Luthans & Doh,
2012; Mathews, 2006; Oviatt & McDougall, 1994; Sharma & Blomstermo, 2003). Furthermore, this is supported
by changing consumer preferences toward customized products and services allowing the BG firm to execute
the rollout of its products and services in the respective niche abroad as well (Rennie, 1993). parcelLab and
linkbird were identified to benefit from similar requirements from their international client base and only have to
deal with minor adaptations concerning language. This is further supported by linkbird´s founder and CEO
statement “people do not care where the product comes from as long as it is good and fits their needs”.
Tripda and NOYS had different experiences. Both still have the challenge of moving from a niche to a
mass market whereas parcelLab and linkbird are precisely positioned in niche markets. Such focus enables
them to rollout their operations worldwide easier due to the degree of internationalization of their niche and
sector. Targeting a B2C audience, Tripda had to deal with cultural issues such as trust, security, and reliability.
A main challenge for them was to understand local aspects of their business as they did not experience a
homogeneous perception of their service in the different markets, but rather individual challenges in each one.
Translation and adaptation were the obvious first steps, and, as they built communities, they chose to establish
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local operations. NOYS is about to face the same challenge as they are dealing with adaptations regarding
content and special features per region and consumer preference.
There is a contradictory approach regarding culture: the lack of a distinctive brand image as a result of
newness and liability of foreignness, language barriers, and the lack of foreign market knowledge (differing
customer preferences) are challenges such firms must face while internationalizing, especially regarding market
acceptance (Cullen & Parboteeah, 2010; David, 2011; Luostarinen & Gabrielsson, 2006; Moen, 2002; Zahra,
2005). All four companies stated their brand image was clearly weak in the beginning due to their newness and
smallness. As this is still the case for parcelLab and NOYS, Tripda and linkbird invested in strategies to
strengthen their brand and raise their brand awareness to target audiences. Partnerships with local eminent
players to reinforce brand values played an important role. Tripda targeted students as brand ambassadors,
while linkbird positioned itself around its solutions. Both approaches were fruitful as they generated regular
inbound leads: linkbird claims to be a strong brand in its sector now due to its presence and customers’
references. parcelLab and NOYS on the other hand plan to undertake similar approaches. This is especially
crucial as all four companies must deal with the challenge of attracting customers for a solution with no concrete
demand yet and as people are not fully aware of their existence and innovative features make the acquisition
of potential customers rather difficult. Thus, branding seems decisive for sustainable success. The lack of
foreign market knowledge is an obstacle evident in all four cases and can only be surpassed with local
partnerships. Overall, under the cultural analysis, differentiating between a B2B- or B2C-orientation is important.
parcelLab and linkbird conduct a one-size-fits-all-approach; their solution addresses homogenous companies
facing similar challenges all over the world; whereas an adapted approach directly targeting consumers seems
difficult to circumvent for Tripda and NOYS. A new aspect in this research that has not been covered in previous
works is the influence of branding initiatives in order to simplify market entries abroad.
4.9 Institutional Drivers and Challenges
From an institutional perspective, drivers and challenges around the topics globalization and trade
barriers came into focus. Globalization and its impact on international trade agreements are seen as propulsive
drivers enabling BG firms to internationalize (Cavusgil & Knight, 2015; Knight & Cavusgil, 2004; Luthans & Doh,
2012; Mathews, 2006; McDougall & Oviatt, 2000; Wild, Wild & Han, 2010). This argument may be confirmed
with the four cases as not one of them experienced any difficulties in their internationalization from an
institutional perspective. All respondents attributed this to the internet as their main distribution channel. The
best example here is linkbird that received a lot of inbound leads just by being available to a worldwide potential
customer base.
Conversely, competition and complexity for a firm’s operations increases with liberalization of trade
barriers and further leads to an uncertain environment, dynamism and change that is especially challenging for
small companies (Alberts & Papp, 1997; Gabrielsson & Kirpalani, 2004). Highly innovative companies based
upon a visionary business model have the potential to disrupt traditional business sectors as the example of
Uber has been for the traditional taxi industry. Insofar, the example of Tripda is very noteworthy: as they have
made the negative experience with one Asian government that prohibited the service after a first intended
partnership. The other three companies have not reached that size yet where their actions could provoke a
similar risk from governmental side. Apart from this example, all companies make use of their existing network
in order to deal with issues around institutions. They further take advantage of their small size along with a lean
business design to be more responsive to changes as shown by the examples of the non-existent formal
marketing audit process of parcelLab or the missing three-year business plan of Tripda. Furthermore, linkbird
defined “focus” as their main challenge for internationalization: due to its many different and complex acquisition
channels, the company needs compute performance measures, a complex task when dealing with channels
internationally.
In summary, globalization as a driving force for the internationalization of BG firms is confirmed.
Additionally, the adhering challenges of a more complex business environment can be dealt with by making use
of the BGs’ networks and flexibility.
5. Conclusion
The purpose of this paper was to assess the driving forces and challenges and how they influence the
internationalization perspectives and actions of BG firms. A thorough literature review allowed the identification
of drivers and challenges and their further classification into five categories: entrepreneurial, economical,
technological, cultural, and institutional. The qualitative approach by means of a multiple case comparison
indicates how the capabilities of innovation, technology, and entrepreneurship are the main drivers to overcome
challenges of financial limitations and the lack of foreign market knowledge.
This paper has brought more clarification to the theory of BGs by looking at its boundaries which are
shaped by the drivers and challenges for their international aspirations. It may be stated that the entrepreneurial
and technological drivers are the strongest forces for internationalization as the influence of elements of the
information age weakens the influence of institutional challenges. In terms of cultural and economic forces, this
paper does not come to clear conclusions and so further research is needed. Nevertheless, the theoretical
assertion that innovation, technology, and entrepreneurship are inherent capabilities to BGs and that existing
network ties of BGs shape their agenda, finds its validation.
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Limitations may arise due to the chosen methodology of a multiple case study: though case studies
present many limitations, especially concerning researcher’s bias and generalizability, the research follows key
procedures in order to obtain higher validity of the construct and reliability. Therefore, multiple sources of
evidences were used (website information, media information, and interviews with key people in the
organization).
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