Final answer:
Startups often operate with substantial risks and founders investing their own money shows belief in their venture's success. Angel investors and venture capitalists play a crucial role in filling gaps in management experience and understanding the business plan, which helps overcome risk and lack of international expertise.
Step-by-step explanation:
Launching a startup firm is inherently risky, especially when these businesses aim to operate on a global scale from their inception. These entrepreneurial ventures, often termed 'born global,' may begin with little more than a compelling idea, and their founders typically possess better insights into the likelihood of the firm's success and their own commitment levels.
When founders invest their own capital, they signal confidence in the venture's potential. To mitigate risks associated with imperfect information, angel investors and venture capitalists engage closely with startup teams. They familiarize themselves with the management and scrutinize the business plan, offering advice to guide the early stages of the company's development.
This hands-on approach helps compensate for what is often a lack of international experience within the firm's management, which is not uncommon among successful global startups. Although contrary to expectations, this lack of experience doesn't necessarily hinder a startup's ability to thrive on an international scale if investors and founders are diligent and strategic in their efforts.