Venture capital firms can help young businesses expand internationally by providing funding as well as market knowledge, expertise and access to professional networks, according to a research literature review published in the International Journal of Management and Enterprise Development.
The study considered 48 papers to see how existing research explains the social influence of venture capital on young firms seeking to establish themselves in foreign markets. The findings reveal an increasingly connected field of research but no single theoretical framework explaining how these relationships operate.
Bibliometric techniques were used to analyse patterns in the literature and citations and co-citation analysis to identify works frequently cited together. From this two-pronged analysis, the team was able to discern four interconnected themes: investor syndication, geographical and cultural proximity, trust formation, and legitimacy, reputation and signalling.
The review suggests that the knowledge investors provide changes throughout the investment cycle. Before investing, they help assess markets, risks, and international growth prospects. Once they have invested, they offer strategic guidance and connections. And, at exit, when investors sell their stake, their expertise can help with valuation, timing, and negotiations.
However, the existing research does not adequately explain how trust develops across investment rounds or how relationships between investors influence the international performance of young firms. There is therefore a need for longitudinal studies to track the various mechanisms and find out how cultural differences and geographical distance affect knowledge exchange.
Cortina-Diego, H. and Díez-Vial, I. (2026) ‘How venture capital increases international new venture knowledge: theoretical bases and emerging topics’, Int. J. Management and Enterprise Development, Vol. 25, No. 6, pp.1–24.
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