A B S T R A C T
SMEs are important to world business and the majority of SMEs are family firms. Yet some family SMEs
are inert, local firms while others are dynamic and international. Do certain governance structures
encourage the scale and scope of their internationalization?We jointly apply social capital and corporate
governance theories to explain the scope of family SMEs internationalization, and find that professional
managers externally recruited from outside the family are important, but only for lower levels of family
ownership, suggesting synergistic combinations of ownership and management. It is the combination of
external capital with external managers that really works.