Early and rapid or late and slow? ::Path dependency caused by age at internationalization

Determining when a company is ready to enter a foreign market is a difficult undertaking. The timing needs to be well considered. On the one hand, developing learning routines necessary for foreign markets and creating sufficient commitment among the staff needs time. On the other hand, older companies tend to be reluctant in their learning ability and act less agile. This article examines the effect of age on the speed and success of internationalizing firms. We also examine different types of perceived impediments in the subsequent internationalization process. A set of hypotheses is developed, drawing on the international new ventures (INV) approach. We test firms’ age at internationalization as a predictor for the speed at which new markets are entered, as well as for subsequent growth in foreign sales while controlling for size, branch, and strategic posture. Relying on longitudinal data from a sample of internationalizing firms from Switzerland, there is evidence of path dependency: The older the firms when they start to internationalize, the slower their subsequent internationalization process. By the same token, we have also observed that firms starting early with their process of internationalization are able to internationalize much faster. This negative impact of age on internationalizing business affects firms not only in the short or medium term, but also in the long term, i.e. over more than 30 years of post-internationalization. Finally, we found evidence that age at internationalization raises the likelihood that the firm will perceive a lack of international experience among its employees and managers as a major impediment for its international success