Incubation in Entrepreneurial Ecosystems

6. Internationalisation assistance

Abstract

Stimulating global startups with strong international growth prospects has become an important priority for incubation programmes and policies. Incubators can support startups to internationalise rapidly in various ways, including through advice and mentoring on handling cultural, market, and regulatory differences between countries, providing access to international networks, and developing soft landing facilities abroad. This chapter describes the role of incubators in supporting “born global firms” and examines how governments can facilitate this.

The emergence of “born global firms”

The increased integration of the global economy since the 1980s has strengthened linkages between entities in different countries and reduced tariff and non-tariff barriers to international trade. It has also contributed to a homogenisation of consumer preferences, making it easier for businesses to cater to the tastes of overseas customers. These factors, together with rapid advances in information and communications technologies, have led to the emergence of a breed of startups that internationalise at a very early stage of their development – so-called “born global firms” (BGFs) (Cavusgil and Knight, 2015[1]).

The internationalisation journey is unique for each startup, although the literature does identify some common features of the startup globalisation process. The Uppsala internationalisation process model posits that firms generally globalise gradually, with an initial focus on markets that are closer to their domestic market from a geographical and cultural perspective (Johanson and Vahlne, 2009[2]; Van Der Krogt and Neubert, 2017[3]). At the earlier stages of internationalisation, startups often seek out lower risk modes of market entry such as licensing or exporting. Global startups also tend to occupy a relatively small global niche (Van Der Krogt and Neubert, 2017[3]). As firms’ knowledge of operating overseas increases, they will gradually extend their operations to more distant markets and become more deeply integrated in international markets through, for example, the formation of international subsidiaries.

While BGFs are more likely to originate from small and open markets, international startups are also prevalent in larger economies (Van Der Krogt and Neubert, 2017[3]). Internationalisation offers many benefits to startups, including a larger and more diverse revenue base and access to new technologies and partners. The more intense competition and shorter windows of opportunity associated with global markets can also result in more rapid growth among startups that internationalise (Burgel et al., 2005[4]).

Although the increased integration of the global economy and the spread of new technologies have significantly lowered the costs of internationalising, startups today nonetheless face important barriers to internationalisation. Geographic, cultural, economic and administrative differences inevitably exist between markets, which can place foreign companies at a comparative disadvantage to domestic companies (Johanson and Vahlne, 2009[2]). This is sometimes referred to as the “liability of foreignness” (Hymer, 1976[5]) (Zaheer, 1995[6]). Foreign companies also have more limited contacts and partners in overseas markets than their local counterparts (Johanson and Vahlne, 2009[2]). These challenges compound the various age and size-related barriers (“liabilities of size” and “liabilities of newness”) that startups frequently encounter, such as having less extensive networks (Stinchcombe, 1965[7]) and more limited access to skills and finance (OECD, 2019[8]), as described in Table 6.1 below.

Table 6.1. Obstacles faced, by company profile

	Liability of size	Liability of newness	Liability of foreignness
Established large companies (domestically focused)	✕	✕	✕
Established SMEs (domestically focused)	✔	✕	✕
Domestic startups	✔	✔	✕
Global startups	✔	✔	✔

To overcome these challenges and establish a competitive edge over local companies, successful BGFs often need unique and high-quality products adapted to the demands of local customers and with sufficient differentiation from local alternatives (Knight and Cavusgil, 2004[9]), (Johanson and Vahlne, 2009[2]). Innovative capabilities are key to achieving this. Another driver of success for internationalising startups is the formation of strong ties with foreign distributors. These partnerships help global startups to overcome their “liability of foreignness” (Knight and Cavusgil, 2004[9]) (Johanson and Vahlne, 2009[2]). The internal attributes and capabilities of startup founders and teams are also instrumental.

The role of incubators in supporting startup globalisation

A primary aim of many incubators is to stimulate the growth of young companies. Since expanding overseas is an important channel through which startups can achieve scale, supporting internationalisation is often a core focus of incubation programmes. As would be expected, incubators in countries with a small domestic market place a strong emphasis on startup globalisation, given the importance of exports as a growth channel for young and scaling firms in these countries. Interestingly, however, incubators’ focus on internationalisation also extends to many larger economies.

One of the primary advantages of incubators lies in their capacity to provide tailored support specifically designed for startups eyeing the international market. This can include targeted training and advice to equip entrepreneurs with the knowledge and skills necessary to develop international business strategies and navigate the complexities of international trade and regulations (Carayannis and Von Zedtwitz, 2005[10]). Research also shows that internationalising firms employ a combination of causation and effectuation processes (Harms and Schiele, 2012[11]; Sarasvathy, 2022[12]).1 The mentoring, coaching and peer learning opportunities available in incubators can support startups in developing and implementing these different strategies for their internationalisation. Through incubation programmes, entrepreneurs may also gain exposure to diverse global markets, enabling them to fine-tune their products or services according to the preferences and needs of international consumers.

The evidence also suggests that knowledge-intensive businesses benefit from faster and more focused internationalisation (Schwens et al., 2018[13]), something that incubation and acceleration programmes are well-placed to facilitate given their rapid and intensive delivery of support, guidance and connections. Furthermore, businesses that pursue innovation and internationalisation strategies tend also to benefit more from immersion in knowledge-rich environments (Estrin, Korosteleva and Mickiewicz, 2013[14]), which incubators can either provide themselves directly or facilitate access to.

The bridging function of incubators is also key. Internationalisation for export-oriented entrepreneurs is inherently a dynamic learning process, characterised by experiential knowledge acquisition and collaborative engagements with network partners (Lee, Jiménez and Devinney, 2020[15]). Additionally, (Freeman, Edwards and Schroder, 2006[16]) emphasise the value of collaboration, suggesting that high-performing, born-global firms tend to engage more frequently with their networks. These networks often evolve into formal business linkages in new markets, serving as instrumental relationships that facilitate further internationalisation efforts (Freeman et al., 2010[17]). In practice, born-global firms often leverage the collective experience of their founding teams and nurture external domestic and international network relationships to acquire essential resources (Laanti, Gabrielsson and Gabrielsson, 2007[18]). Incubators can be key in helping startups to expand their networks internationally. This assistance in establishing links to international markets may be particularly beneficial for inexperienced entrepreneurs (Wright, Westhead and Ucbasaran, 2007[19]).

Fostering the creation and growth of international startups supports progress towards many government objectives in areas such as exports, innovation, productivity, job creation and economic growth. As such, stimulating startup globalisation has become an important policy priority. The remainder of this chapter examines how governments can use incubation programmes as a tool for supporting startup globalisation.

Dedicated incubation programmes for startup globalisation

Many governments in OECD countries have launched incubation programmes that are dedicated to supporting the internationalisation of startups. These programmes deliver many forms of internationalisation assistance, including:

• Networking with potential partners, investors and customers in the target market. This can take place virtually as well as in-person through short study visits or demo days in the target markets. For example, the European Innovation Council’s business acceleration services include the Overseas Trade Fair Programme, which allows selected innovative companies to showcase their products in strategic markets and make contacts with new partners. A similar initiative is Korea’s Global Conference Support programme, which funds startups to participate in global expositions such as the CES in the United States, Switch in Singapore, Slush in Finland and Viva Tech in France. The French Tech Capitals also send startups in their regions to international trade fairs.

• Individualised coaching and mentoring, which can include assistance in developing an internationalisation plan or assessing product-market fit. Often this support is delivered by local experts with strong experience and connections in the target market.

• Training and workshops on topics relating to international market insights, processes and opportunities.

Often, government-run incubation programmes are based on partnerships with overseas incubators. These are immersive programmes through which startups spend time overseas to learn about local customs, procedures and markets and build relationships with local partners, investors and customers. Such initiatives are commonly referred to as “soft-landing” schemes.

Box 6.1 describes the approach of the Korean Ministry of SMEs and Startups’ K-Startup Centers programme, which is a leading soft-landing initiative, while Box 6.2 presents the case of the German Accelerator programme – a major public programme focused on supporting the internationalisation of startups.

Some other examples of incubation programmes in OECD countries that focus specifically on the promotion of startup globalisation include:

• The Canadian Technology Accelerators programme, which provides coaching, mentoring and networking services to help Canadian businesses to establish themselves in 12 international locations (5 in the United States, 5 in Asia and 2 in Europe).

• The Global Incubator Programme in the UK, which provides opportunities for small cohorts of 6-8 innovative SMEs to spend 4-6 months in overseas incubators, with the UK’s innovation agency covering the travel, training and incubation costs.

• Beyond Beta’s internationalisation programme, which aims to help Danish startups to develop a structured approach to expanding overseas and select the most appropriate target markets to target, embedding internationalisation within their strategy from an early stage.

• The Netherlands’ ScaleNL Accelerator programme, which delivers 3-months of coaching and mentoring to cohorts of 10 founders, culminating in a networking trip to the United States.

• The Austrian Ministry for Labour and Economy’s Global Incubator Network Austria (GIN), which seeks to connect Austrian incubators with their counterparts in select countries. Austrian and international incubators within the network participate in the GIN Startup Exchange, which provides the incubators with opportunities to receive promising startups from abroad and to send their own startups to partner incubators overseas.

Box 6.1. K-Startup Centers, Korea

Objectives and rationale

The K-Startup Centers (KSC) initiative is a public acceleration programme that hosts Korean startups in global innovation hubs in other countries. The aim is to help Korean startups to internationalise through the provision of physical bases, training and networking opportunities.

Description

The KSC programme receives financial support from the Korea SMEs and Startups Agency (KOSME) and is jointly operated by KOSME and the Korea Institute of Startup and Entrepreneurship. Development (KISED) The programme began in 2019 with the inaugural centre in Seattle, the United States. As of 2024, there are four hub-type other centres in Paris (France), Hanoi (Vietnam), Singapore and Tokyo (Japan). The selection of destination countries is based on the foreign governments’ commitment to supporting Korean startups along with the host country’s ecosystem and policy direction, reflecting market characteristics by region and policy agenda. KSCs may be established through a Memorandum of Understanding (MOU) or a similar form of non-binding agreement, which is often signed during official visits by high-ranking officials such as the President or Prime Minister.

The KSCs serve as a physical base for the selected Korean startups in global innovation hubs, providing access to working spaces and office services. By facilitating their settlement in foreign markets, the KSCs provide networking opportunities that enable startups to connect with relevant parties, including investors and established businesses. The startups also participate in an acceleration programme that provides various forms of assistance including capacity building, mentoring, networking, and funding. Consulting services in areas such as tax, business establishment or the local legal or regulatory systems are also available. However, support is primarily on-demand, considering the diverse needs of startups.

The KSCs target startups at a relatively advanced stage of internationalisation. Startups can submit applications to the KSCs. Subsequently, it undergoes an evaluation by the Korean governing bodies (KOSME and KISED). The evaluation criteria include the originality, uniqueness, and competitiveness of the product or service, the feasibility of the overseas startup plan, and investment or export performance, as well as the founder's expertise and readiness for global expansion.

Success factors

The KSC operates by specialising in promising industrial sectors specific to each region. For instance, the Seattle center focuses on fields such as Big Data/AI, Robotics, Quantum Technology, Aerospace/Maritime, and Eco-friendly Energy, while the Singapore center prioritises sectors including AI, Semiconductors, Service Platforms, Precision Medicine, and FoodTech. For each of these areas of focus, the KSC establishes one or multiple local partners that are active in the field. This sector-specific approach enables a more tailored support network to be developed. The admission of startups operating within similar areas facilitates synergies through collaborative efforts and peer learning. Simultaneously, for the centre lead, managing the relevant network, expertise, and services provided to startups becomes more efficient and effective.

KSCs also act as platforms for local investors exploring investment opportunities, providing rich opportunities for the startups to showcase themselves to centre visitors. In addition, the fact that the startups operate within the centres provides a geographical proximity that strengthens mentor-mentee relationships with investors.

A distinctive aspect of the Korean startup ecosystem lies in leveraging the infrastructural resources of conglomerates. In keeping with this ethos, the KSCs seek to harness the resources and infrastructures of large firms in foreign countries. Several leading Korean firms possess sales channels and physical offices abroad. Exploiting this advantage, Korea established the KSC Vietnam centre within L-Camp Vietnam, operated by Lotte Ventures. This collaborative approach with the private sector facilitates open innovation with local subsidiaries and provide judges for funding and Investor Relations (IR) networking opportunities.

Challenges

Each KSC is built upon partnerships with local experts or entrepreneurial ecosystem actors (“KSC partners”). The KSC partners are essential in building connections to the local market and also in selecting Korean startups with business models that are aligned with the local market and its demands. Establishing these partnerships is therefore a key challenge that defines the success of a particular KSC. KSC partners are primarily local accelerators, meticulously chosen through a competitive process. However, it is important to note that these partnerships are subject to change based on the partners’ performance and feedback received from participating startups.

Conclusions and takeaways

The KSCs are an innovative policy initiative that has shown itself to be effective in stimulating the internationalisation of promising Korean startups. As of 2023, the KSCs had supported 185 Korean startups, many whom have since been very successful in setting up, growing revenues, and building partnerships overseas. Given the specific focus on supporting the globalisation of startups that are already fairly well-developed domestically, the KSCs focus less on the capacity building and training aspects of incubation and more on the relational aspects that help the startups to build connections in their target market. Key to achieving this is the formation of partnerships with local experts and entrepreneurial ecosystem stakeholders (“KSC partners”), who provide the key to unlocking these relationships with relevant actors in the target country.

Box 6.2. The German Accelerator programme

Objectives and rationale

The German Accelerator programme was established in 2012 as part of a package of measures within the Ministry for Economic Affairs and Climate Action’s (BMWK) flagship innovation policy (the “From the idea to market success: Programmes for an innovative SME sector” initiative). The German Accelerator helps startups to expand into international markets. It is financed by the BMWK and run by the Start2 Group. The federal government’s 2022 startup strategy set out that, as part of its mission to put more focus on startups, the Federal Government will continue to invest in the expansion of the German Accelerator programme to further promote international networking of the startup ecosystem.

Description

The German Accelerator was launched in 2012 with a first office in Silicon Valley and has since been expanded systematically to the now ten offices in locations across North America, South America and Asia. The programme has so far received approximately EUR 100 million in funding. The BMWK’s last call for tenders for the management of the German Accelerator (awarded to the Start2Group) was sized at EUR 55 million for the funding period from 1 January 2021 to 31 December 2024.

The German Accelerator runs three types of programme that are tailored to startups at different stages of the internationalisation process: i). programmes preparing startups for internationalisation (“Academy”), ii). programmes for market exploration (“Market Discovery”), and iii). programmes for market entry (“Market Access”). Throughout these programmes, the German Accelerator offers access to a global network of potential partners, customers, investors, and an engaged community of other programme participants and alumni. Individual support and customised mentoring are offered both virtually and on-site by the programme teams and a network of experienced industry mentors, who provide their expertise and networks for product and business model validation in the respective target countries. In addition, free office space is provided to startups in all locations of the German Accelerator. Another benefit for the startups is discounted access to various products, services, and tools from a variety of partners, as well as a range of free resources, ranging from market awareness checklists to regional reports.

For startups to be admitted onto the programme, the German Accelerator requires that core team functions have been established, that there is a proven problem-solution fit, and that there is founder or C-level commitment to the programme. Startups must also be incorporated in Germany and be under the limit of the EU De-minimis aid regulation. For those meeting these requirements, the selection process is based on quality criteria including scalability, founding team quality (including members’ international orientation and mindset), proof of customer interest and generation of revenue on the domestic market, and relevance of the product in the potential target market.

Success factors

The German Accelerator has supported over 850 startups, which have raised more than USD 15.6 billion (approximately EUR 14.4 billion) in funding, with around three quarters active in the Americas. In 2017 and 2019, the BMWK commissioned Ramboll Management Consulting GmbH to undertake evaluations of the German Accelerator. The 2019 study concluded that the programmes offered by the German Accelerator are designed in a target-oriented way and implemented professionally. The identified outcomes for startups include increased visibility, business model development and adaptation to the target market, as well as the acquisition of new partners and customers.

The German Accelerator’s mentoring offer is key to the success of the programme. Mentors are recruited via local employees and teams at the regional hubs, who know the local conditions and are well connected. The major recruitment channels include network referrals and recommendations, for example from partner incubators or investors from the local market. The delivery organisation’s (Start2 Group) integration within the German and international innovation ecosystems is key to facilitating this. A key distinguishing feature of the German Accelerator’s network of more than 1 000 mentors is the presence of many mentors with German citizenship who on the one hand have knowledge of the German entrepreneurial system and on the other hand have experience in the host country and knowledge of local framework conditions. Another important feature is the mentors’ many years of business and financing experience and their very good contacts with decision makers and investors.

To ensure the quality of the mentoring offer for the startups, the German Accelerator has in place a structured matching process to connect startups with relevant mentors. There is also a monitoring and evaluation system for the mentor network, which aims to continuously improve mentoring quality through feedback mechanisms. Mentors are removed from the programme where they do not meet expectations or are not sufficiently involved. Opportunities for mentor exchange and get-togethers are also organised regularly. Finally, the BMWK has fostered an environment in which the mentors and programme managers can thrive, by affording them a sense of autonomy and flexibility to experiment with the programme design, management, and delivery. This results in a high level of commitment on the part of the programme management and mentoring team.

Challenges

Building the mentor network was a defining challenge for the German Accelerator, and one that it has addressed successfully over a period of years, including through the development of a mentor recruitment strategy that takes a proactive approach to accessing high quality mentors by leveraging community partners. There have also been challenges surrounding the tender preparation and planning process. For the last call for tenders for the funding period 2021-2024, the tender preparation and planning took place over more than 18 months. Here, the difficulty lay in developing a call for tenders that was precise but at the same time provided enough flexibility for the delivery organisation.

Conclusions and takeaways

The German Accelerator is a successful example of how a national programme can help startups to scale globally by providing them with access to mentoring, networks, and resources in leading innovation hubs. A key learning that can be derived from the case of the German Accelerator is its strategy of investing considerable efforts into building an exceptional mentor network in its target regions. The case also highlights the benefits from having a professional delivery organisation (Start2Group) that has a strong background in supporting startups and is embedded within the innovation ecosystems of the targeted markets. Indeed, the localisation of the German Accelerator’s programmes through local offices, teams and networks is a key source of value for the startups, and one of the most important tasks for the programme team is therefore to find trusted partners abroad.

From a logistical standpoint, there are benefits to integrating an internationalisation-focused accelerator programme within a suitable ministry department with existing expertise in startup financing, internationalisation, and expansion. The German Accelerator programme is integrated at the BMWK department VIIC4 (“Guarantee Banks, KfW Subsidiaries, Innovative Startups, Commercial Credit Insurance”). This department also oversees the “EXIST” support programme, which helps university graduates, students and scientists in developing knowledge-based and technology-oriented startups. As a result, the department has good access to a large network of high-tech startups which it can draw on to create synergy effects in the further development of the German Accelerator programme.

Selecting and supporting companies with internationalisation potential

There are numerous examples of public incubation programmes that are designed specifically to support startups in entering international markets. However, there are many more examples of programmes without an explicit internationalisation-focus that nonetheless play an important role in promoting startup globalisation by offering more generic supports to young companies with high internationalisation potential. Internationalisation potential is often a key selection criterion for admission onto public incubation programmes. For example:

• Startup Lisboa’s incubation programme requires admitted startups to have products or services that are scalable and with global potential.

• Denmark’s national accelerator programme (Beyond Beta) lists “have a scalable business model and address a growing international market” as one of the four basic criteria for admission onto the programme.

• The German Accelerator’s stated mission is to empower German startups to scale globally.

• Japan’s Global Startup Acceleration programme is principally focused on supporting domestic startups to expand their business operations overseas.

• Business Sweden’s Leap Accelerator lists multiple internationalisation-related criteria among the basic entry requirements for startups.

Since startups admitted onto these programmes are selected based on their potential to scale internationally, the provision of generic supports such as mentoring and coaching will inevitably help to drive the internationalisation process.

The targeting of firms with internationalisation-potential for incubation programmes raises the important question of how to identify such companies. The literature offers some insights on this. Entrepreneurs’ growth intentions relate positively to subsequent firm growth (Douglas, 2013[20]; Knockaert, Foo and Erikson, 2011[21]) and the evidence suggests that those who do not have growth ambitions will not grow (Davidsson, 1989[22]; Davidsson, 1991[23]). Founders and managers in born-global firms also possess an international orientation and mindset (Mcdougall, Oviatt and Shrader, 2003[24]). This implies that for incubators to be effective in promoting global startups, they must first be able to identify and target ambitious entrepreneurs with a vision for international expansion. This targeting can be a considerable challenge, as the ambition or international outlook of entrepreneurs is not easily observable. However, the literature has identified some more observable characteristics that are also associated with entrepreneurs having a strong internationalisation potential:

• Many born global firms (Knight and Cavusgil, 2004[9]) are founded by individuals who have personal international experience or have worked in multinational corporations (Acedo and Jones, 2007[25]).2

• Growth-oriented entrepreneurs are more likely to be highly educated and to be part of a team (Levie, 2015[26]).

• Companies with foreign professional experience or international education are more likely to internationalise early (Reuber and Fischer, 1997[27]). An explanation for this is that prior knowledge reduces managerial risk and uncertainty in internationalisation and speeds up decision making (Knight and Liesch, 2016[28]).

• (Levie and Hart, 2011[29]) find that UK-born regional in-migrants and immigrants are more likely to be entrepreneurs with high-growth expectations than lifelong residents.

• (Estrin, Korosteleva and Mickiewicz, 2022[30]) argue that the knowledge spillover theory of entrepreneurship (Audretsch and Keilbach, 2007[31]) leads to a relationship between the knowledge intensity of a business and the growth aspirations of the entrepreneur.

By strategically identifying and supporting entrepreneurs with a strong inclination towards export, incubators can contribute to stimulating the creation and growth of global startups. The case for this type of targeting is supplemented by evidence that firms that are more internationalisation and growth-oriented benefit more from training than other firms (Kotha et al., 2023[32]) and are more likely to survive (Del Sarto et al., 2021[33]).

Leveraging public facilities overseas to enrich internationalisation supports for startups

The facilities and contacts of overseas embassies, consulates and enterprise agency branches are a valuable resource for supporting the globalisation of startups. The incubator scheme of the Trade Council of the Ministry of Foreign Affairs of Denmark provides an illustration of how a country’s diplomatic mission facilities can be utilised to offer incubation support to internationalising companies. The scheme provides Danish companies with physical or virtual office space in 15 countries. The physical spaces are situated in Denmark’s embassies, consulates and trade commissions, enabling businesses to begin overseas operations more smoothly. These spaces can be provided for up to two years, with host businesses benefitting from access to office space and meeting rooms as well as bespoke advice. Meanwhile, the virtual office space provides a solution for internationalising companies that need only a physical address so as to receive telephone calls and mail. This in turn can boost local sales and streamline administrative processes. This provision of virtual office space is one example of how digitalisation has opened up avenues for incubators to support larger numbers of startups in a cost-effective manner.

Similarly, France’s diplomatic posts and the economic departments of its embassies and consulates in other countries play a role in promoting the internationalisation of French startups through their support for the 67 French Tech Communities abroad. As one example, the third edition of “French Tech Capital Days” in Miami in 2024 was organised by French Tech Miami and the French-American Chamber of Commerce in Miami, with the support of the local committee of the Advisors for French Foreign Trade and the French consulate. Over the course of two days, 25 French startups (particularly from the Aix Marseille and Sophia Antipolis regions) developing innovative technologies across a range of fields competed in front of juries composed of French and American investors and entrepreneurs. Meetings were then held between startups and investors and local companies ready to support them in their development.

Conclusions and policy lessons

Governments in many countries are introducing policies and programmes that aim to foster the creation and growth of global startups. This reflects the strong potential for these companies to innovate, create jobs and support exports, productivity and growth. Business incubators are a key channel through which governments can support startup internationalisation, given the focus of these organisations on enabling the rapid growth and internationalisation of promising young companies.

Incubators support startup globalisation through the provision of dedicated training, information and advice on international market opportunities and processes, through immersive soft-landing programmes in target markets, and through networking and matchmaking between startups and international partners. To enhance the role of incubators in stimulating global startups, governments can:

• Target born globals: Admission criteria and funding conditions for public support programmes for incubators is a powerful policy lever for governments to promote startup globalisation. Governments can include the capabilities of incubators to support the internationalisation of their clients as a key criterion for admission onto public funding programmes. This approach can steer the incubation system towards placing a greater focus on internationalisation support.

• Create dedicated programmes: Although incubation programmes often promote the internationalisation of promising young companies through generic supports such as mentoring and networking, governments can take the further and more direct step of launching dedicated programmes that place a primary focus on supporting startup internationalisation, including immersive soft-landing initiatives. Key to the success of such programmes is building partnerships with incubators and other entrepreneurial ecosystem actors in the target markets and ensuring the internationalisation-readiness of the participating startups.

• Incentivise foreign partnerships: Business incubators should be incentivised to build up networks and linkages with incubators and ecosystem actors in other countries, including investors, large corporates, mentors and researchers. These international networks can significantly enrich the value offer incubators provide to clients looking to expand to overseas markets by facilitating introductions and targeted matchmaking.

• Build a base: Access to resources, facilities and contacts in target markets is integral to supporting the internationalisation of startups and scaleups. For priority markets, governments can develop networks of entrepreneurs, investors, researchers, industry professionals and other relevant individuals with a connection to the home ecosystem and a knowledge of the foreign market. These partners and networks provide a valuable extra resource for startups and scaleups that complements those provided by incubators.

• Leverage existing assets: There is potential for the assets, knowledge and contacts of diplomatic missions abroad to be leveraged more by incubators in order to support startups in establishing themselves in other countries. Opportunities should be created for startups and scaleups to access the resources of diplomatic missions in priority markets. Steps should also be taken to involve diplomatic missions in activities to support the internationalisation of startups, for example through the hosting of networking events or study missions.

• Engage the ecosystem: Governments can engage large, established companies in the delivery of incubation programmes. This can significantly enhance the value to startups and help them to internationalise, for example by providing them with greater access to international networks and enhanced opportunities to integrate within global supply chains.

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Notes

← 1.  Causation is a strategy used by entrepreneurs to plan and execute a predefined goal by predicting future market conditions and customer behaviours through extensive research and analysis. Effectuation is based on the principle of affordable loss, where entrepreneurs experiment with different possibilities and taking affordable risks. Effectuation is highly flexible and adaptive, iteratively adjusting goals based on emerging opportunities and constraints. It emphasises the leveraging of available means to create successful outcomes, while causation focuses on prediction and control.

← 2.  Not all early internationalising founders, however, have international experience, with many global founders lacking international business experience (Knight and Liesch, 2016[28]) (Freeman et al., 2010[17]).