Essay About Global Firm And Overseas Markets

What Could Be the Advantages and Disadvantages of Being a Born-Global Firm?
Question 1: What could be the advantages and disadvantages of being a born-global firm?        There are several benefits to being a born-global firm, such as the first mover advantage. According to the book, born-global firms recognize from the beginning of its operations that their customers and competitors are international, giving them the advantage of placing themselves early on those markets. Since born globals tend to target overseas markets even before they target their own home markets, it gives them the advantage to attract larger amounts of audience than traditional firms. An example could be Skype; since the beginning, the application was created to provide their services to markets overseas instead of focusing on their own home market first.         On the other hand, born-global can have its disadvantages too. Since born-global firms do not follow the traditional evolutionary steps, they tend to have a weaker foundation. In my opinion, not having a strong home market could also be considered as a disadvantage because the firm does not count with a back-up plan or a market to rely on. Question 2: Why would licensing sometimes be appropriate-and sometimes inappropriate- for a strategically important country?           In my opinion, licensing can be appropriate for a strategically important country when using it as a method of market entry. According to the book, when companies do not have enough capital to expand into multiple markets they have the ability to use licensing to gain market presence without making an investment. I believe this is appropriate because is giving the company the opportunity to expand into more profitable markets without risking much. On the other hand, licensing can be inappropriate because they are usually granted for a limited amount of time, meaning that after the license has expired, the licensee has the sufficient knowledge to become a competitor.