The Institutional Context for the Growth and Internationalization of ICT Start-Ups in Japan : Evidence from Rakuten and GREE

This paper aims to examine the influence of national institutions on start-up firms’ initial growth and internationalization. Focusing on two entrepreneurial start-ups in the ICT sector, this study highlights Japanese institutions in transition, and depicts the way in which rapidly growing start-ups have overcome the challenges posed by the unique institutional environment. This research finds that the rapidly growing firms have navigated through the challenges by avoiding, adapting, or influencing specific institutions. Further, in the process of growth, start-ups have also leveraged inter-firm labour mobility and migration as key mechanisms for initiating and sustaining institutional interaction. Finally, this study argues that the internationalization of rapidly growing firms is being affected by a multi-lateral, rather than bilateral, process of institutional recombination