Introduction

International business (IB) research on emerging economies focuses mainly on the level of multinational and transnational corporations (e.g., Meyer et al. 2009), but these corporations often start their market entry in collaboration with a local representative or receive incentives to enter from local entrepreneurs (cf. Lin 2010). Often, such bridge-builders between countries are diasporans (Brinkerhoff 2009). These small actors as drivers of change and development have not attracted much research interest in the “transitional periphery” of Central Asia (cf. Brinkerhoff 2009; Kuznetsov 2008; Newland and Tanaka 2010; Debass and Ardovino 2009, see also Arslan et al. 2015). However, they are acknowledged in international business and entrepreneurship, especially due to their transnationalism and entrepreneurial characteristics (e.g., Tung 2008; Drori et al. 2009; Brinkerhoff 2009; Piekkari et al. 2010; Jones et al. 2011; Kyle 1999; Lin 2010). The role of entrepreneurs in transition economies (e.g., Bolt 1997; Khalmurzaev 2000; Welter et al. 2006) and a better understanding of their intertwined global investment behaviour are of central importance for business and economy (cf. Buckley and Ghauri 2004). Entrepreneurs are central to economic development, as they take risks, search for and develop opportunities, they strive for livelihood and increased profits, as well as for growth and expansion (cf. Bolton and Thompson 2004; Burns 2001). Bolton and Thompson (2004) regard entrepreneurs as persons with talent and temperament who make things happen. International entrepreneurship (IE) is described as “a combination of innovative, proactive and risk-seeking behaviours that crosses national borders and is intended to create value in organizations” (McDougall and Oviatt 2000, p. 903). In similar vein, transnational diaspora entrepreneurs represent a form of international entrepreneurship connecting business across borders (e.g., Drori et al. 2006; Riddle et al. 2010).

Diaspora research may assist in explaining venturing and internationalisation processes in and from emerging economies, when combined with IB and entrepreneurship theories. Diasporans as economic actors, i.e. entrepreneurs, are influenced by numerous endogenous and exogenous determinants. Diasporans are “migrants who settle in one place, move on and regroup; they may also be dispersed, and they are in a continuous state of formation and reformation” (Cohen 2008, p. 142). Brubaker (2005) considers diasporans to be individuals who meet the criteria of dispersion, homeland orientation and boundary maintenance. Riddle et al. (2010) define transnational diaspora entrepreneurs as migrants and their descendants who establish entrepreneurial activities that span the national business environments of their countries of origin (COOs) and countries of residence (CORs). Due to globalisation and increasing immigration, diasporans as entrepreneurs have become an important category of entrepreneurs (Xavier et al. 2012). They facilitate international business connections between their COO and COR (Brinkerhoff 2009; Cohen 2008; Riddle et al. 2010) and have particular roles in homeland investment (Gillespie et al. 1999). This study approaches diaspora entrepreneurs as diasporans who may also be repatriates or circular migrants and who carry out business activities as self-employed professionals, classic individual entrepreneurs, co-entrepreneurs, business owners, investors or multi-entrepreneurs.

Diasporans are generally seen as being forced to seek alternative ways to maintain their families’ livelihood, and thus as pushed into entrepreneurship; beyond necessity, however, there are also opportunity driversFootnote 1 (cf. Welter and Smallbone 2010). Necessity relates to less qualified diasporans who face employment problems in the host country and suffer from the absence of other alternatives (Ellis and Pecotich 2001; Heinonen 2010). On the other hand, there are also elite diasporans with developed skills and numerous alternatives for their career and livelihood (cf. Leinonen 2012; Mullings 2011). There are also individuals who are not pushed to migrate by necessity, but who choose to become diasporans to fulfil their entrepreneurial, career or social goals and dreams (Vissak and Zhang 2012).

Research on diaspora flows has examined issues with economic implications, such as remittances, brain drain and brain gain, with a focus on the macro-level flows and effects (e.g. Cohen 2005; Tung 2008), but has not yet explained individual-level decision making and diaspora strategies. The research on brain circulation takes a broader view, connecting flows and competitiveness (e.g. Tung 2008), while diaspora investments and entrepreneurship research integrates people into the research interest (cf. Gillespie et al. 1999; Kotabe et al. 2013; Riddle 2008). The importance of diaspora in the economic growth of the home country, especially in large emerging markets such as China, Brazil and India has been broadly acknowledged (e.g. Aliaga-Isla and Rialp 2012; Bolt 1997; Chung and Tung 2013; Nkongolo-Bakenda and Chrysostome 2013; Poutziouris et al. 2002; Riddle et al. 2010; Vissak and Zhang 2012). The transition economies in Central Asia have not yet attracted similar attention—despite the emerging nature of their international business or the investment potential of diaspora entrepreneurs (diaspora direct investment, DDI; cf. Abdurakhmonov 2003; Azizov 2007; Debass and Ardovino 2009; Newland and Tanaka 2010; Sattarov 2012). Only very few studies have been conducted on Central Asian entrepreneurial activity and its transitional context (Bikbaeva and Gaibnazarova 2009; Khalmurzaev 2000; Suhir and Kovach 2003; Welter et al. 2006; Welter and Smallbone 2010).

In short, Uzbekistan in Central Asia needs to generate entrepreneurship but is mostly seen as a place of departure, not a place to venture. In the context of Uzbekistan, the determinants that drive entrepreneurs to venture there are largely unknown, and the determinants for diaspora entrepreneurs’ venture decision (as they could choose to venture in the USA, the EU or other developed economies with less uncertainly and institutional voids) are even more so (cf. Nkongolo-Bakenda and Chrysostome 2013). Thus, the determinants for Uzbek DE are theoretically interesting as these entrepreneurs decide to venture in a particularly difficult context, although they have comparative foreign perspectives and other alternatives for venturing or livelihood (e.g. employment, migration, repatriation).

Research on determinants and dynamics of DE needs better contextualisation (e.g. Lasch and Dana 2011). Due to the transitional character of the Central Asian economies, this study turns the classic diaspora perspective (outflow) around and focuses on the underexplored diaspora entrepreneurship (DE) “flow” towards business (inflow) in emerging economies (cf. Nkongolo-Bakenda and Chrysostome 2013). This micro-analytical perspective concentrates on entrepreneurial level dynamics instead of institutions, transaction costs, agency and resources (Wright et al. 2005). It is assumed that different factors affect necessity-driven diasporans from poor countries seeking a better future in new host countries than those entrepreneurs and diasporans who enjoy international alternatives for their place of venturing. The non-acknowledgment of this strategic choice may create an underlying research bias. Generalisations and the lack of segmentation in diaspora analysis create additional research problems; therefore, findings on the “poor-to-rich-country entrepreneurship” logic are not applicable to other cases with a different aetiology. This study points out that there are diaspora entrepreneurs acting against the poor-to-rich flows investing in an emerging market economy, thereby suggesting a dissimilar entry strategy (cf. Meyer et al. 2009). Moreover, it employs a novel analytical typology for DE (Fig. 1) and for contextualisation of the DE type and country setting, which assists the development of propositions that guide the research process and analysis (Fischer and Reuber 2001).

Fig. 1
figure 1

Theoretical and analytical typology of DE based on COO and COR types (Source: Elo 2013)

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Emerging market economies are countries in transition reforming their markets towards a market economy after being dictatorships, parts of the Soviet Union or other centrally regulated, command economies (Irnazarov 2009). According to Peng (2003), institutional transitions from a planned economy to market competition in Russia are pervasive enough to be labelled transition economy. In turn, weak institutional infrastructure, uncertainty, economic and political instability and lack of suitable ties affect entry choices and strategies (Peng 2003; Peng and Luo 2000; Wright et al. 2005). They lack such pull-factors that developed countries provide. As a result, developing and emerging countries are seen as the COO of diasporans, but not yet as target countries wherein they want to invest and work. Altruistic motivations represent the only exception to this (cf. Debass and Ardovino 2009; Riddle and Brinkerhoff 2011; Nkongolo-Bakenda and Chrysostome 2013). Thus, it is important to understand the migration flows and directions, and beyond that, the underlying factors stemming not only from economic circumstances but also from individuals’ dreams, opportunities and socio-cultural contexts (cf. Elo et al. 2015). These individual-level entrepreneurship determinants require an in-depth understanding that is more contextual (cf. Dunning 2006, see also Nkongolo-Bakenda and Chrysostome 2013).

The “targeting rich countries” assumption is too one-sided and probably invalid in relation to diaspora entrepreneurs, as entrepreneurs act in multiple embedded contexts (e.g. Smallbone and Welter 2008). Especially in the case of Uzbekistan, we do not really know what drives entrepreneurship as an alternative to emigration or what stimulates repatriation and migration to the this “transitional periphery”(cf. Arslan et al. 2015). The pull and push factors on the macro-economic level fail to explain alone this phenomenon on incoming DE (cf. Lasch and Dana 2011; Nkongolo-Bakenda and Chrysostome 2013). Thus, the study asks: What makes people become entrepreneurs in a transition economy like Uzbekistan, especially if they have other alternatives to prosper elsewhere? The purpose of the study is to examine if there are distinct types of DE and to explore determinants that influence the generation of such DE in the difficult context of transition economy. The study attempts to identify key determinants for this decision from a rather holistic perspective, as the influence of socio-cultural context is often neglected (Urbano et al. 2011), and the macro-level context dominates IB research (cf. Dunning 2006). The multiple-case study presents culturally diverse entrepreneurs who have decided to invest and work in Uzbekistan and their reasons for this decision. The entrepreneurs represent various migrant backgrounds and ethnicities, including both Uzbek and non-Uzbek nationals. Theoretically, the study attempts to develop and test proposition for future DE research.

The study contributes with the typology providing the contextualisation and with its nexus of extant research on emerging economies and DE. It serves to give insight into the unique emerging Uzbek private entrepreneurship and the settings behind it (cf. Abdurakhmonov 2003; Irnazarov 2009; Majidov 2007) and is among the first to deal with DE related to Uzbekistan and the role of diasporans in Uzbek economic development (cf. Elo et al. 2015; Khalmurzaev 2000). The study contributes with novel information for understanding DE on individual level, which is particularly interesting in an emerging country setting and during a reform era.

The article is divided as follows: the next “Business, diaspora entrepreneurship and investment in Uzbekistan” section reviews the current research literature on business in Uzbekistan illustrating the contextual setting of an emerging economy (the “Business and entrepreneurship in Uzbekistan” section), and it reviews research on transnational DE (the “Transnational diaspora entrepreneurship” section). The “Development of theory with the typology of diaspora entrepreneurship and understanding DE determinants” section presents the discussion on DE theory development and propositions and the novel theoretical-analytical typology employed for DE research contextualisation. Then, the “Method and research design” and “Analysis and research findings” sections discuss the method and research design and present the analysis and research findings. Theoretical, managerial and methodological implications are discussed in the conclusive “Conclusions and discussion” section, along with suggestions for further research and policymaking.

Business, diaspora entrepreneurship and investment in Uzbekistan

Business and entrepreneurship in Uzbekistan

Entrepreneurship and the development of private business after the Soviet era is still a considerable challenge (cf. Bikbaeva and Gaibnazarova 2009; Khalmurzaev 2000; Libman 2008; Peng 2003). Beyond institutional challenges (Peng 2003; Libman 2008; Wright et al. 2005), several country-specific differences are evident. Khalmurzaev (2000, p. 295) summarises the key differences in the small and medium-sized enterprise (SME) sector as follows: Uzbek SMEs exhibit lower performance and competitiveness than developed market SMEs do; they provide jobs to fewer employees; and the significance of state property is disproportionate. Business and social infrastructures present impediments for SMEs (Khalmurzaev 2000). However, these challenges are counter-balanced in Uzbekistan by a fast-growing economy and the largest population in Central Asia. Uzbekistan offers various opportunities such as the free industrial and economic zone in the Navoi region for business, especially for significant foreign investments (Investment policy review of Uzbekistan 1999). Moreover, it has attracted foreign investment and businesses such as the CNPC, Petronas, Nestlé, British American Tobacco, Gazprom, Lukoil, VimpelCom, MTC and General Motors, and its economic policies are designed to attract large manufacturing and service companies from abroad (US State Department, 2014, http://www.state.gov/e/eb/rls/othr/ics/2012/191261.htm). Investments may be influenced by prior investment choices (Azizov 2007), but a real bandwagon effect (Aharoni 1966) has not occurred in the case of Uzbekistan, perhaps due to problems with trade openness and reliability (Sattarov 2012; http://www.state.gov/e/eb/rls/othr/ics/2012/191261.htm retrieved 27.1.2014). Notably, the role of private entrepreneurship, which emerged in the 1990s (Khalmurzaev 2000), is still developing, along with the rules of the game (Peng 2003). The authoritarian regimes that have ruled Central-Asian countries since their independence still face problems in finding suitable transition strategies for their economies, which were among the poorest and least industrialised parts of the USSR (Stark 2010). Uzbekistan has transformed in numerous ways, such as legislation, taxation, capital and credit systems, business support systems and education, but it has followed a gradual reform path (Khalmurzaev 2000; Libman 2008). In terms of international business, Uzbekistan has failed to become a hot spot despite its historical role in the Silk Road; in fact, some multi-national corporations (MNCs) have exited the market, such as Caterpillar and Texaco Overseas Holdings Inc.

The location of Uzbekistan is logistically demanding, as it is a landlocked country. This creates difficulties in foreign trade, particularly due to disadvantages in transportation infrastructure. In 2012, the main trade partners of Uzbekistan were Russia, China, Kazakhstan, the Republic of Korea, Turkey, Afghanistan and Ukraine, which illustrates the regional emphasis on external trade relations. The economic regional integration in Central Asia is also supported by intra-regional migration (Libman 2008) and strong local socio-cultural ties (Coudouel et al. 1998; Welter and Smallbone 2010). This geo-economic emphasis is visible in Uzbek foreign trade, investments and entrepreneurship.

Concerning entry conditions and receptivity, there is a size bias: Uzbekistan strongly favours major foreign investments and discourages investments by small and medium-sized foreign investors (Majidov 2007), although some improvements are evident (Khalmurzaev 2000). To further promote the state policy of self-sufficiency, Uzbekistan’s foreign investment regime particularly favours foreign investors who produce goods in Uzbekistan that may be exported or which replace goods that would otherwise be imported (Doing Business in Uzbekistan 2009, p. 14.) According to Majidov (2007), “The economic policy pursued during this [post-independence declaration] period created a unique environment for the newly emerging entrepreneurial class to operate in. In addition, the political regime centred on a strong leadership and the so called ‘Ideology of Independence’ created an entirely new set of incentives and punishments for those aspiring to get ahead” (p. 147). Centralisation remains strong. The official language is Uzbek, especially for documents and administration, but Russian is employed as the lingua franca for business and inter-personal networks (Libman 2008). In addition to practical difficulties and limitations for foreign entrepreneurs, the repatriation of profits is considered difficult. However, the relative stability, high gross domestic product (GDP) growth rates (in 2012 the GDP grew 8.2 %) and emerging private enterprises and SMEs also provide positive impulses for the economy, development and entrepreneurship (cf. http://www.uzinfoinvest.uz/eng/living_in_uzbekistan/economy/, retrieved 30.4.2013; Welter et al. 2006).

There are no institutional or other regulative pull factors in Uzbekistan, since the policies for entrepreneurs in small and family business are not particularly welcoming. There are no specific entry policies for foreign-born, diasporic entrepreneurs or repatriates, also called returnees. A work permit for a foreigner is relatively expensive (compared to the local salary level), and is valid for no more than 1 year. Private entrepreneurship is young due to the Soviet system and despite the support programmes and instruments (EBRD, TACIS, the Chamber of Commodity Producers and Entrepreneurs, the Association of Dekhkan Establishments and Farms, and numerous incubators), its conditions are complex and the lack of capital and credit hinder development opportunities (Khalmurzaev 2000). Khalmurzaev (2000) lists the key problems for foreign companies as follows: constantly changing laws and regulations, an inadequate banking system, a poor communication system, currency conversion problems, a lack of basic information, shortage of necessary suppliers and corruption. Thus, it is not surprising that the number of foreign, non-Central-Asian entrepreneurs is rather limited. Bukharian Jewish diasporans (Ochildiev et al. 2007) represent an exception as international entrepreneurs, but they are a minority with Uzbek origin. Due to their international networks and Israeli support, they have managed to facilitate trade relations, repatriation and entrepreneurship in Uzbekistan. With the direct participation of the Centre for International Cooperation of the MASHAV (Israel’s Ministry of Foreign Affairs), a Consulting Centre for small and medium-scale business (KSMSB) was established in 2003, intended to lend informational and consulting support to small and medium-scale business, mainly in agriculture (Chlenov 2009, pp. 414–415). Bukharian Jews, along with Koreans, Chinese, and neighbouring ethnicities, form the most important groups of international entrepreneurs. Koreans represent a significant diaspora population of 200,000 in Central Asia (Seo 2010). It is estimated that there are millions of Uzbek migrant workers abroad, a large number of them in Russia (http://www.uznews.net/news_single.php?lng=en&cid=0&nid=23494, 28.1.2014) and Kazakhstan (Libman 2008), which illustrates the nature of Uzbekistan as a sending country (Hanks 2000).

Uzbekistan is an emerging market, still developing its economic system and framework; “since gaining independence in 1991, Uzbekistan has adopted new legislation at a rapid pace. It remains a country in transition and its legal system is in continuing development” (Doing Business in Uzbekistan 2009, p. 9). Uzbekistan has chosen an evolutionary strategy rather than a revolutionary one in reforms and is not yet considered a market economy, but instead an emerging market (Irnazarov 2009). For foreign-born entrepreneurs and SMEs, the impediments are notable, and there is lack of pull forces. As the country overview indicates, Uzbekistan with its “sending country” and negative characteristics is a suitable sample market for studying incoming international and transnational DE. In the next section, theories related to DE are reviewed.

Transnational diaspora entrepreneurship

Historically, the economic influence of diaspora is well documented. A trade- and business-based diaspora represents a nation of socially inter-dependent but spatially dispersed communities, in which family and kin, the creation of a common commercial culture and religion, among other factors, provide the ties that bind (Cohen 2008, p. 83). Historically, diasporans have been approached as “pariah people” who have lost their territories, were confined to particular occupations and were endogamous in terms of dietary prohibitions, religious practices and social intercourse (cf. Cohen 2008). Diasporas are also referred to as “middlemen minority” in the cases of Jews, Indians, Chinese, Lebanese and Greeks (Cohen 2008). In short, the impact of blocked opportunities, lack of alternatives, hostility and ethnic cohesiveness has been considered relevant in the creation of extrinsic and intrinsic motivations for entrepreneurship.

International entrepreneurship (McDougall and Oviatt 2000) involves numerous domains and themes but does not incorporate diaspora entrepreneurship (Jones et al. 2011). However, characteristics of international entrepreneurs are present in related domains such as ethnic, minority, immigrant, transnational, transnational diaspora and diaspora entrepreneurship (e.g. Aliaga-Isla and Rialp 2012, 2013; Bolt 1997; Carmichael et al. 2010; Chung and Tung 2013; Drori et al. 2006, 2009; Light and Gold 2000; Menzies et al. 2000; Ojo 2012; Portes et al. 2002; Riddle 2008; Riddle et al. 2010; Waldringer et al. 1990). Transnational entrepreneurship has been described as a social realm of immigrants operating in complex, cross-national domains with dual cultural institutional and economic features that facilitate various entrepreneurial strategies (cf. Riddle et al. 2010). DE, transnational DE and transnational entrepreneurship are closely related, and the terms are often employed synonymously, although there are some ontological differences in their definitions. This paper acknowledges these differences, but employs the terms diaspora entrepreneurship and transnational diaspora entrepreneurship interchangeably, since it focuses on contemporary diaspora as transnational, that is, connected to two (or more) cultures and societies (cf. Vertovec 1999).

Contemporary research on diaspora entrepreneurs approaches entrepreneurship in multiple ways concerning the logic and triggers (cf. Aliaga-Isla and Rialp 2013; Xavier et al. 2012). As Putz (2003) notes, there are particularities in drivers and entrepreneurial motivation. Limited employment opportunities due to language barriers and discrimination are seen to drive immigrants to self-employment in order to secure their livelihood. However, DE should not be approached as an extrinsically forced alternative, since the role of the entrepreneur is dissimilar to that of a victim of circumstances: In parallel with extant limitations, the entrepreneur can also possess important entrepreneurial resources (cf. Lähdesmäki and Savela 2006). Motivational structures vary in previous studies and present a continuum from unemployment and “forced entrepreneurship,” which represents a common stream of thought in diaspora and immigration research, to opportunity development, growth and success leading to increased quality of life (cf. Heinonen 2010; Joronen and Ali 2000) that is more similar to entrepreneurship theory (Bolton and Thompson 2004; Cassis and Minoglou 2005). The emergence of immigrant communities (cf. Ojo 2012) can form entrepreneurial opportunities in areas such as ethnic food and clothing; thus, immigrant communities develop a unique subculture that may encourage and support self-employment (Riddle and Brinkerhoff 2011). According to Pütz (2003, p. 555) such a subculture (cf. Jenssen and Kristiansen 2004) inspires some ethnic groups to be more entrepreneurial, thereby generating stereotypes such as “having business in their blood.” However, there are differences in the entrepreneurial patterns (Kaplan 2003), as well as entrepreneurial traditions and activity among different ethnicities (Light and Gold 2000).

Diaspora produces enablers for business, as they carry an “immigrant effect” in their activities; they perceive, compare and analyse opportunities and threats differently from the way in which mono-cultural entrepreneurs do (e.g. Enderwick et al. 2011; Chung and Tung 2013; Nkongolo-Bakenda and Chrysostome 2013; Riddle et al. 2010). They also possess different ethnic resources that assist them socially, particularly those with a lower level of education (Light and Gold 2000). Such resources consist of ethnic culture, social networks, values, attitudes towards entrepreneurship and economic behaviour, religion, cultural institutions and family structures (Light and Gold 2000). The diaspora effects with innovative social organisation may be advantageous to the diaspora, its homeland and its place of settlement (Cohen 2008; Riddle 2008). Still, a common ethnic background is not automatically a bond between actors or a guaranty of solidarity, and the existence of diaspora networks does not necessarily mean that they are employed for business and entrepreneurial purposes (cf. Waldringer et al. 1990); they can also be more relevant for social activities and information sharing (cf. Brinkerhoff 2009; Hepp et al. 2011; Jenssen and Kristiansen 2004). Effect towards the country of origin influences the engagement and behaviour of diasporans (Barnard and Pendock 2012). Barnard and Pendock (2012) claim that international business research should pay greater attention to this individual level, and especially to emotional aspects, since negative feelings have very different effects compared to positive ones. Again, this influences investment behaviour and motivation (Newland and Tanaka 2010).

Diaspora entrepreneurs often invest in their COO, and thus contribute to its economic development while supporting their family and enhancing their social standing in the COO and/or the diaspora community (e.g. Riddle and Brinkerhoff 2011). Such community-driven behaviour, personal referrals and informal relationships in business are employed in collective cultures (Ali et al. 1997). “Elite immigrants” and their entrepreneurial activities are also influenced by their social context, especially family ties and marriage (Leinonen 2012); the social effect is particularly strong in a collective society like Uzbekistan (Welter and Smallbone 2010). Family ties can influence business strategies in the establishment stage (Vissak and Zhang 2012). Both economic and non-economic actions are “socially embedded”; thus, business and social ties are intertwined (Ellis and Pecotich 2001; Granovetter 1973, 1985; Poros 2011), which also influences decisions to become a DE (Heinonen 2010) and may assist in international business (Schotter and Abdelzaher 2013). However, DE may be burdened with challenges that spring from the differences in the COO and COR institutional and business environments (Riddle et al. 2010), as well as the inherent emotional “heritage” (cf. Barnard and Pendock 2012). As Heinonen (2010) notes, different cultures and religions may have significant expectations concerning the contributions and success of the diaspora entrepreneur.

The economic effects of diaspora have been examined from the perspective of remittances sent to the families in the COO (Cohen 2005), how diaspora networks act as facilitators of international trade and networking (Chung and Tung 2013; Cohen 2008; Mullings 2011; Wong and Salaff 1998), how foreign direct investment (FDI) is positively affected by information flowing across international borders (Javorcik et al. 2011) and how DDI influences transitional economies (Abdurakhmonov 2003; Azizov 2007; Debass and Ardovino 2009; Sattarov 2012). The social effects of diaspora vary in purpose and activity (Gill and Bialski 2011; Harvey 2008). Diaspora entrepreneurs belong to a multi-faceted socio-cultural constellation; they have competencies in at least two cultures (COO and COR), and due to continuous reformation, they may evolve towards further transnationalism and cosmopolitanism (cf. Riddle et al. 2010; Vertovec 2009; Vertovec and Cohen 2002). Diasporas act as conduits and agents for international competitiveness employing “brain circulation” (e.g. Tung 2008).

It can be concluded that diaspora entrepreneurs operate in a complex interplay of business and socioeconomic environments and are subject to being driven, lured, pushed, motivated and de-motivated on the individual, family, social, business and macro-levels. In short, both extrinsic and intrinsic motivations influence their entrepreneurship together with other determinants. In the next part, the paper discusses the meaning of the entrepreneur’s origin and DE target country.

Development of theory with the typology of diaspora entrepreneurship and understanding DE determinants

Transnational diaspora entrepreneurship is one intersection that contributes to the call for domain expansion of international entrepreneurship (cf. Jones and Nummela 2008). This study is positioned close to “international comparisons of entrepreneurship” and addresses the inherent combinations of cross-country and cross-culture views at the level of individual entrepreneurs (Jones et al. 2011, p. 636). It responses to the call on contextualising IB and IE research (e.g. Michailova 2011; Welter 2011). Due to missing contextualisation, many aspects of DE have remained undisclosed or only partially explained. Many determinants of DE have been interpreted as generic ones and the distinct and diverse nature of different DE types has been neglected (cf. Nkongolo-Bakenda and Chrysostome 2013). Deducing from previous research, it is expected that different types of DE entrants have stand-alone theory-mechanisms and distinct contexts (e.g. innovation, market, time and place). DE may suffer (e.g. Chaudhry and Crick 2004) or benefit (e.g. Elo et al. 2015) from the contextual asymmetry between COO and COR; also, the determinants of DE can be linked to this asymmetry. In order to address the diverse DE “types” and their dynamics, they need to be set into a context that allows their analysis per type. Thus, a typology on DE is employed to contextualise DE into nine types for increased analytical rigor and clarity (Fig. 1).This specific framing introduces and explores novel diaspora types, such as rich-to-emerging diasporas. This DE typology is an analytical framework that contextualises DE (cf. Johanson and Mattsson 1988; Minoglou 2005) based on the host country’s (COR, i.e., the location of entrepreneur and her/his company) character and the character of the COO regarding the entrepreneur (Fig. 1) (Elo 2013, see also Elo et al. 2015). The typology divides the “origin/heritage” country and the “residence/entrepreneurial activity” country into three categories—developing, emerging and developed markets—referring to their overall level of developmentFootnote 2 (cf. OECD, DAC list of ODA recipients 2014). The asymmetry of the country setting influences DE and the determinants of DE. Here, asymmetry relates to the economic imbalance between settings, the institutional voids and socio-cultural divergences, and the inherent need for transformation from the perspective of the entrepreneur. The institutional side regulating DE (e.g. migration policy, entrepreneurship policy and support systems) may provide particular impediments for high asymmetry contexts (Fig. 1c, g), while this impact may be weaker in cases of lower degree of asymmetry as institutional agreements (formal or informal) with neighbouring countries may be less restrictive or even welcoming. In the following research analysis, Afghanistan is categorised as a (least) developing country, Kirgizstan and Tajikistan as developing countries and Uzbekistan, Kazakhstan, Turkmenistan, Pakistan, Iran and China as middle-income countries, referred to here as emerging markets. The USA, Germany, Israel and South Korea are developed countries.

This typology is theoretical and analytical; it does not aim to present the ideal types of Max Weber, but rather to assist in organising and analysing types of diaspora and entrepreneurship constellations in a framework that helps to position the contextual setting for research (cf. Cohen 2008, p. 161). As Cohen (2008) writes, “The ideal is a yardstick, an abstraction and a simplification, a means of showing up similarities and differences in trying to encompass an array of possibilities that would otherwise have little form or shape… a typology will help to delineate, analyse and compare many diasporic phenomena” (p. 161). Analytically, this typology does not include the variants of diaspora as second and multi-generation phenomena and the evolutionary path, or circular diaspora per se, take into account hybrid and transnational forms of culture and identity of the entrepreneur or his/her level of skills, or differentiate between “hot spots” and rural areas; rather, generalises any intra-country and intra-category aspects with vigorous effect. Still, it is a necessary tool for analysis and contextualisation, as it explicates the other missing types of DE flows and illustrates how heavily the current diaspora and DE research stream has focused (research perspective bias) on the following categories: C developing to developed, that is, high asymmetry-based classic DE, and F emerging to developed, that is, medium asymmetry-based classic DE (cf. Fischer and Reuber 2001). The DE types relevant for Uzbekistan (emerging economy) are B, E and H, representing very different types compared to the common C or F types.

The framework on approaching the dynamics and determinants of DE is guided by types B, E and H that cover all origin variants of incoming DE in this emerging economy, thus allowing a comparison of types, cases and determinants within them. Leaning on proposed DE determinants for developing country of origin context (Nkongolo-Bakenda and Chrysostome 2013), the analysis works from country level (cf. context friendliness, receptivity of the country, integration and support systems) towards more individual-level influences (cf. entrepreneurial opportunity, need of social recognition, altruistic motivation). To frame the analysis, this study deduces propositions from extant literature and research guiding the development of the theoretical framework, and the analysis phase of this research process. First, previous literature has identified country origin-specific flows of DE, such as Chinese or Indian DE (e.g. Chand and Ghorbani 2011). This study proposes that DE determinants and assumptions are not similar for these nine different types but potentially context-specific (cf. Chand and Ghorbani 2011; Nkongolo-Bakenda and Chrysostome 2013) as diasporas are not homogenous entities (Cohen 2008), and each country has particular pull and push factors addressing the respective DE.

  • Proposition 1. Diaspora entrepreneurship dynamics (determinants) are dissimilar in different country contexts (nine types), because both the sending and receiving country influence the dynamics of DE.

Therefore, it is assumed that there are three types of DE in Uzbekistan. It is anticipated that diaspora entrepreneurs who act in an emerging market context (“Emerging” column, Fig. 1) differ from diaspora entrepreneurs in developed markets (“Developed” column, Fig. 1), as they apply other perspectives and frameworks with higher uncertainty and country risks to start businesses. This is not explainable by origin alone, as the target area and its degree of difficulty and respective learning are also relevant. High asymmetry is expected to be more demanding to cope with, thus, it seems to be linked to strong individual-level determinants, especially to opportunities but also to altruistic and social aspects that may be associated with either the COO or the COR. Medium and especially low asymmetry make coping in the host country easier. Medium and low asymmetry are expected to be more connected to country- and market-level determinants and perceived opportunities. Low asymmetry involves fewer imbalances and may support entrepreneurship and integration better than medium or high asymmetry venturing which have a more demanding context and higher risks due to higher uncertainty. In the case of post-Soviet transition, there was no legacy of private entrepreneurship to build on and the circumstances were very challenging for any investor. In fact, the institutional problems and restrictions posed an element of demotivation for investment (cf. Peng 2003; Suhir and Kovach 2003; Wright et al. 2005). Further, current research assumes that country-level economic factors determine DE emergence in the receiving country, since rich countries attract migration and venturing while poorer countries act as recipients of remittances (e.g. Vaaler 2011). This view emphasises the role of economic level and catching up processes. Therefore, the DEs are theoretically flowing from poorer to richer countries, but not vice versa. Here, this assumption is reflected with new empirical findings illustrating flows and directions of DE beyond this flow and the typology employed closes the theoretical “direction bias gap” by framing the country setting beyond poor-to-rich flows and introducing emerging and developing economies as targets (cf. Elo 2013; Elo et al. 2015; Mayer et al. 2016; Harima 2015). It can be proposed that for DE, there are multiple directions of flows with context-specific dynamics (cf. Newland and Tanaka 2010) and not just one direction.

  • Proposition 2. There are “opposite” flows of DE entering emerging and less developed countries, therefore, there are potentially other than country-level economic determinants for DE.

Individual diaspora entrepreneurs build the DE establishment and investment decision making on their total constellation of positive and negative drivers and enablers, especially in the context of the transitional periphery, where institutional voids are significant. Previous findings indicate that DE is not a purely rational economic decision, but involves complex intertwined forces that are also based on emotions and socio-cultural factors (Elo and Jokela 2014). The determinants for DE are often considered to be contextual and generated by necessity or ethnic economies (cf. Light and Gold 2000). The developed country-origin DE is less confined and potentially more risk tolerant, while developing or emerging country-origin DE suffers usually from stricter constraints, also due to migration policy. Additionally, diasporans who have good opportunities to enter the labour market or to return to their more developed countries of origin or residence cannot be described as necessity or forced entrepreneurs in the same sense than the terms are employed on often discriminated, even marginalised migrants from developing countries (cf. Heilbrunn et al. 2010). Instead, it is claimed that the perceived opportunities the host markets offer in a particular spatio-temporal setting form potential determinants for DE (e.g. Riddle et al. 2010; Nkongolo-Bakenda and Chrysostome 2013); also, the entrepreneur’s capabilities in developing these opportunities into business are linked to these determinants.

  • Proposition 3. DE is influenced by the combination of necessity and opportunity determinants that are perceived by the entrepreneur and are context specific.

The growing stream of research on transnational DE linking two countries requires more insights into the interplay of individual entrepreneurs, their socioeconomic and country contexts, especially in emerging and developing country contexts. More understanding on the determinants generating DE, and how this early stage of private entrepreneurship and internationalisation is lived by diaspora entrepreneurs in an emerging economy, may assist in fostering DE and economic development.

Method and research design

The research process is designed to develop and assess DE theory (types and determinants) and to answer the question what makes people become entrepreneurs in a transition economy like Uzbekistan, especially if they have other alternatives to prosper elsewhere (determinants of entrepreneurship generation in the context of Uzbekistan). The research strategy and theoretical framework follow the research questions. A qualitative approach combining case study and ethnographic methods is chosen because the study explores a current phenomenon in a real-life context, and this approach has approved fruitful (Caprar 2011; Ghauri and Grønhaug 2010; Stake 1995; Yin 1984; Alasuutari 1995). A case study is a useful method, as the area of research is relatively less known, and the researcher is engaged in theory-building research regarding the typology (Ghauri 2004). In addition, case study is suitable because the existing theory on DE is inadequate (cf. Eisenhardt 1989). More interpretative nature of case study here facilitates novel insights while exploring determinants (Piekkari et al. 2010).

The research strategy is twofold: first, the theoretical framework and propositions developed rather deductively (the “Development of theory with the typology of diaspora entrepreneurship and understanding DE determinants” section) form the theory-analysis design and guide the structuring of the study towards its theoretical implications; second, a more explorative strategy in data collection and analysis discovers the perceptions and interpretations of the entrepreneurs on their entrepreneurship, its establishment and its development in Uzbekistan. The research process compares them guided by the analytical typology (cf. Alasuutari 1995; Cohen 2008).

The purpose of data collection in the comparative case study method is to compare (replicate) the phenomenon (e.g., DE formation) in a systematic way, to explore different dimensions of the research issues or to examine different levels of research variables (Ghauri 2004). In this study, the comparative element is limited to the comparison regarding the entrepreneurial path and the typology as replicability on in-depth level analysis is not expected (Jick 1979). In addition, the international researcher team applies an ethnographic approach that documents culture, behaviour and their interconnectedness in a more holistic manner and goes beyond a priori data structuring towards a more emic research approach in data collection (cf. Alasuutari 1995; Piekkari et al. 2010; Silverman 2001). The more theory-driven etic research part—in line with the progressive focusing model in Sinkovics and Alfoldi (2012, 825)—appeared first in the mature analytical phase. This approach safeguarded the reliability and trustworthiness of the primary data and reduced dangers of bias (Sinkovics and Alfoldi 2012)

The data collection involved both primary and secondary data to enable a context-embedded view of the cases. It was supported by an 11-day field trip to Uzbekistan in 2012 with the purpose of collecting observations, field notes and photographic material. In winter 2012–2013, the research questions were developed building on DE literature and the guiding questions were pre-tested for understanding and appropriateness. The researchers applied snowballing and purpose sampling methods while selecting the entrepreneur-cases based on being diasporan and entrepreneur with business activities located in Uzbekistan (cf. Ghauri 2004; Heinonen 2010). They addressed the reasons for DE and completed eight case studies on locally based entrepreneurship, representing the following ethnicities: Uzbek, Bukharian Jewish, Korean, Tajik and German. The researchers included one mainstream culture of Uzbek entrepreneur for a reference point and used two expert interviews for overviews (cf. Khakhar and Rammal 2013). The selection of cases was set to find origin diversity to apply the data for the analytical DE types. The empirical study focuses on a novel and distinct type of DE: it examines the entrepreneurial types in the “Emerging” column in Fig. 1. The researchers identified emerging-market DE (Type E) and pioneer-style DE (Type H), but could not obtain any “pure” developing country representative beyond the Tajik entrepreneur (Type B). Many of the less wealthy and less educated B type candidates (from Afghanistan, Kyrgyzstan) the researchers identified (e.g. shoe repairer, tradesman) refused to talk about their entrepreneurial activities due to fear of getting into troubles.

For access and quality of interpretations (Salmi 2010; Marschan-Piekkari et al. 1999), a native Uzbek research assistant with dual ethnicity, who was a linguist with specialisation in German, visited the entrepreneurs personally in 2013 and conducted in-depth interviews with guiding questions for comparability (Eisenhardt 1989). The employment of a native research assistant in the team of international researchers reduced linguistic-cultural distance (cf. Marschan-Piekkari et al. 1999; Salmi 2010; Voldnes et al. 2014) and avoided problems in interpreting concepts and coding (Sinkovics and Penz 2011). This approach eliminated many research problems related to foreign researchers and the research difficulties in post-Soviet transition economies and thus increased the quality of the study (Voldnes et al. 2014; Michailova and Liuhto 2001). The interview topics and questions covered a variety of aspects to obtain a wider understanding of the informant’s relation to his/her socio-cultural setting, motivations and entrepreneurial activities. The interviewees were informed that the researchers were interested in their entrepreneurship and socio-cultural setting. Many candidates refused due to fear (cf. Michailova and Liuhto 2001). The researchers used trusted individuals to facilitate contact in some cases, but they did not have any role in the actual data collection after the contacting. The interviews lasted about 1.5 h and were recorded and transcribed as they occurred (Pettigrew 1990). They were carried out in combinations of Russian, Uzbek, Tajik, German and English according to the interviewee’s language, and then translated into German; German and English replies were not translated.

Analysis and research findings

The data analyses moved from the emic to etic approach and explored the material with a view to fulfilling the purpose of the research, that is, to understand entrepreneurs’ decisions and reasoning on DE in the context of the emerging market in Uzbekistan (cf. Salmi 2010). A systematic approach was employed to enhance equivalence by creating a comparable data on each case. Interplay of research, analysis and interpretation took place over time, as the team posed follow-up questions and revisited elements both at the material and researcher level (cf. Halinen et al. 2013; Salmi 2010). The reliability, trustworthiness and quality of data was supported by structuring the overall process to reduce “messiness” and by employing technical solutions to deal with multiple data (Sinkovics and Penz 2011; Sinkovics and Alfoldi 2012).

All three types of DE in Uzbekistan (B, E and H) appeared already during data collection. Next, to explore and understand these DE inflows, their drivers and resources and mechanisms that form and regulate DE, the analytical process considers four essential analytical levels (from macro to micro, including embeddedness) for the respective drivers and enablers (Fig. 2).

Fig. 2
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Analytical levels for the determinants

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The analytical approach considers that the reasons, motivations and processes for becoming an entrepreneur in an emerging market need to be particularly significant to overcome the deficits of transition economies characterised by high uncertainty, numerous business problems and even political instability. The selection of place, that is, the business environment, is interesting, because the focal entrepreneurs here could have chosen something else, another country or career path, but selected the transition periphery setting to live and do business. Motivations and reasoning for entrepreneurship in this post-Soviet economy are examined to understand what drives the decision to start business in an “opposite flow” context and where these motivational influences originate. Embeddedness as a source of resources to make the business viable and its role as constraint is one under-researched dimension of entrepreneurial SME internationalisation (cf. Kyle 1999; Welter and Smallbone 2010).

The collection and analysis of data was organised to address the second research question on the individual determinants to become an entrepreneur in Uzbekistan. The researchers examined the perceptions and explanations of the entrepreneurs, along with their views and interpretations of their entrepreneurship in their individual context working with interpretative analysis based on primary data (Welch et al. 2010). The interview data were not pre-determined or limited in scope; instead, they were guided (explanation of determinants integrated) and stimulated by open-ended questions (cf. Alasuutari 1995). The interview data were initially analysed via content and thematic clusters (responses in the interviews), then triangulated with other data (photos, observations, etc.); in two cases, follow-up interviews were needed to verify the interpretation or clarify missing aspects. Finally, the paper presents the analysis and findings in an aggregated form (thematic clusters) complemented with extracts from the narratives, paying particular attention to hindering traceability and applying high research ethics (Kuula 2006; Weijer et al. 1999).

The research materials were aggregated and organised using NVivo 10 software. Case data were categorised, clustered, evaluated, triangulated and compared (cf. Fig. 2), and finally organised into a thematic table (see Table 1 and Table 2; cf. Kottak 2006). The analysis employed intense triangulation of data (across material, researchers and data collection methods) increasing the quality and trustworthiness of the analysis and findings; in addition, careful planning, research audits and systematic analysis enhanced credibility and neutrality (Denzin 1978; Jick 1979; Golafshani 2003). Triangulation was also necessary as both data collection and analysis required interplay between foreign theoretical and native contextual understanding (cf. Salmi 2010; Jick 1979).

Table 1 Individual and socio-cultural influences on becoming an entrepreneur (understanding individual and embedded endogenous determinants on DE)
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Table 2 The influence factors stemming from the country and business market context (understanding macro- and meso-level exogenous determinants on DE)
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The findings concerning the typology were clear; the types B, E and H DEs were identified and confirmed as in the typology (Fig. 1). One clear case of “pioneer-style DE,” type H was case 1, and mixed forms of it in cases 3, 5, and 6. These three cases involve circular or second-generation diasporans, and thus it was not possible to find the “ideal type” for them, as they belonged to different categories in the business lifecycle (cf. Cohen 2008). Type H had the highest freedom to decide, she had numerous alternatives for DE in Uzbekistan; she could find employment, migrate again or return to COO. Type E “Emerging market DE” represented the majority of cases (cases 4, 5, 7, and partially 3 and 6), which is expected since the region has a vivid multicultural history and trade network. Most of these cases had alternatives, such as employment or migration, only case 5 had basically no other alternative in Uzbekistan. Case 2 was a mixed version of type B “lonely starter-style DE” and type E “emerging-market DE,” since the entrepreneur was not first-generation Tajik diasporan; as the Tajik diaspora in Uzbekistan has integrated well into the multicultural business environment, the national origin has become less relevant for such 1, 5-generation diasporan. The pure “lonely starters” of type B (shoe repairer and tradesman) did not allow us to interview them, but we documented their existence. Type B entrepreneurs had the least alternatives; they were struggling for livelihood and remittance creation via entrepreneurial activity as there were fewer options for employment, return or migration elsewhere. The findings on the reasons to become an entrepreneur (compared to career in employment or migration to a more developed country) and choose Uzbekistan as the place of business were mainly linked with local opportunities and socio-cultural diaspora-generated factors (see Fig. 3, Table 2.), but also with necessity aspects as their narratives illustrate (Fig. 3). Interestingly, the repatriated diaspora entrepreneurFootnote 3 in case 5 was more driven by necessity than the other diasporans whose situation involved more choices, while all of them acknowledged the role of some opportunity in Uzbekistan. Thus, it was not the lack of alternatives that drove them to become entrepreneurs but an idiographic configuration of opportunity and necessity related to the host country Uzbekistan. The type B entrepreneurs chose Uzbekistan due to its better opportunity structure compared to their COO, but they had very few alternatives both in COO and COR.

Fig. 3
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Individual-level reasons of entrepreneurial entry (DE) in Uzbekistan

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The major part of the analysis focused on the individual determinants for becoming a diaspora entrepreneur in general; it explored the individual micro level and the socio-cultural embeddedness factors (Table 1). Here, the drivers were generation of an idea and underlying personal dynamics such as background, possession of local or diasporic business-lens, and socio-cultural aspects. It is important to note that in this study, the entrepreneur’s country background was mainly a combination of location and cultural heritage, not a single country, except in cases 7 and 8. The type of socio-cultural embeddedness and their degree of transnationalism varied over culture, generations and time, but also over the number of country connections. Therefore, circular and multi-generational diaspora may have different—even accumulated—implications than two-country-based transnational diaspora on their entrepreneurship. A low level of transnationalism may also influence the nature of the resulting DE, for example, producing rather local than international business activities.

The reason why they wanted to choose Uzbekistan as the host country for their venture was a set of individually perceived determinants. All of them (limited in case 8) had the opportunity to choose another country, or other alternative, such as employment or migration. In fact, cases 4, 5, and 6 had wholly or partially repatriated and were content with their decision. This indicates many opposite flow-DE cases, which was not expected based on migration statistics. All cases illustrated venture reasons (see Tables 1 and 2) relating to life strategy, personal dreams, competences and plans, income and economic benefit, opportunity identification and exploitation, local network connectedness and the particular willingness to work in Uzbekistan. No dominant push factor (e.g. war or other crisis) was found in the interviews, but for type B, entrepreneurs who refused the interview were potentially pushed by their necessity situation (developing country COO). Interestingly, none of the cases considered another country to start their business; however, some of them (cases 1, 4, and 6) had previous businesses in Germany, Russia or the USA. It seems that many determinants for business establishment on micro-level were rather idiographic (see Tables 1 and 2).

In the second part of the empirical analysis, the emerging market-, country- and institutional-level opportunities and other factors influencing the DE are examined (Table 2). In this analysis, both the country and the market-level contextual determinants are explored. Particularly, the role of the market and the location of the business, opportunity development, connectedness and growth and long-term orientations were identified and analysed.

Finally, the comparison of the determinants for DE from previous research and the explored determinants in this context pointed out several differences. The determinants are organised with the logic of analytical levels (as in Fig. 2), then the explored determinants are reflected on the extant ones, and the results of the comparison of these two flow contexts (cf. Harima 2015) are illustrated in Table 3.

Table 3 Comparison of DE determinants
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Conclusions and discussion

Theoretical implications

DE theory needs better conceptualisation and contextualisation (cf. Michailova 2011). As the findings illustrate, there seems to be no “one ideal case” of diaspora entrepreneurship or generic determinants that provide theoretical grounding for a universal model (cf. Nkongolo-Bakenda and Chrysostome 2013). Emerging country-hosted entrepreneurship has country-specific settings influencing incoming DE flows (cf. Libman 2008); therefore, these types of DE may vary greatly and be idiosyncratic. The degree of contextual asymmetry (COO and COR) influences the determinants of diaspora entrepreneurship: higher asymmetry requires a stronger set of DE determinants, while lower asymmetry seems to be more moderate in terms of the DE determinants. This difference may also be the result of migration policies and institutional restrictions on entrepreneurial activity of “foreigners” and not of the entrepreneurship-level determinants. DE seems to emerge and evolve more naturally in a lower asymmetry context, also because diasporans are used to cope with the required transformations in emerging economies. Higher asymmetry in developed or developing host contexts might bring different findings. The findings underline that the “emerging” context is distinct from a “rich” or “developing” one, for example, in terms of institutions and economic characteristics (cf. Peng 2003; Suhir and Kovach 2003; Wright et al. 2005) but also in terms of DE motivations and drivers. Since the theoretical research inquiry is constructed on testing and developing the typology on its emerging column types towards a theoretical-analytical tool for DE, the interest is particularly high on the existence of the three distinct types B, E and H. The discovery and existence of these three types function as the support for proposition 1:

  • Proposition 1. Diaspora entrepreneurship dynamics (determinants) are dissimilar in different country contexts (nine types), because both the sending and receiving country influence the dynamics of DE.

Moreover, the country of origin and motivation-related factors were very dissimilarly constructed, despite the common role of opportunity as a determinant. The level of transnationalism was different in different types. The implicit role of other CORs with entrepreneurial and resource networks for DE suggests that the COO-COR typology is too limited for circular diasporans. Hence, it is suggested that generalisation across DE types without assessing the types and the context are flawed. The findings illustrate opposite flow examples from developed countries and support proposition 2:

  • Proposition 2. There are “opposite” flows of DE entering emerging and less developed countries; therefore, there are potentially other than country-level economic determinants for DE.

These cases illustrate the heterogeneous nature of DE and their different determinants (cf. Table 3). Their determinants were not identical to determinants for COO-based DE, but had similarities in socially constructed determinants and opportunities. As Nkongolo-Bakenda and Chrysostome (2013) suggest, diaspora international entrepreneurship depends not only on their level of altruistic motivation, need of social recognition and entrepreneurial opportunities, but also on the friendliness and receptivity of the home country, as well as integration of and support to immigrants. In the case of Uzbekistan, the role of intrinsic motivation and opportunity—even social networks—were significant, but there was no evidence for the role of country-level friendliness, receptivity or any migrant integration or support programmes. The employed typology and comparison of different cases has its limitations too. DE, particularly concerning the first generation, differs from the other local or foreign forms of emerging market-based entrepreneurship, representing dissimilar resources, initiation and growth dynamics. First, DE may be more greenfield-based and family entrepreneurship and employ less acquisition and joint venture modes of entry (cf. Meyer et al. 2009). Second, its ownership and entry characteristics differ from those of incumbent firms—often state-owned enterprises—and privatised firms, local entrepreneurial start-ups and foreign entrants, thereby creating a category of its own (cf. Peng 2003; Wright et al. 2005). Third, the individual embeddedness has a stronger effect on DE than on the previous types and their entry-exit behaviour has socio-cultural dimensions (cf. Elo and Jokela 2014; Urbano et al. 2011). The findings in this emerging market context show two important intertwined dynamics that need to match to stimulate DE, which support the findings on the interplay of necessity and opportunity (Welter and Smallbone 2010). These are as follows: (1) the development of the market per se and its attractiveness, particularly recognised opportunities, in comparison to other perceived alternatives, and (2) the strategic life planning of the entrepreneurs, including family embeddedness, phase in life, and personal goals, necessity and dreams. These dynamics may explain why foreign entrepreneurs and diaspora returnees choose to venture in Uzbekistan instead of another more developed country.

Concerning DE motivations and drivers, the study found drivers for elements 2–3 on the individual level (Fig. 2). There were enablers in all thematic categories that may—when missing—constitute obstacles or barriers to entry. Interpersonal networks and access to social infrastructure were crucial. It did not find any significant DE consideration related to labour costs, taxation, legislation, capital supply or political country-level effects of a transition economy, which is contradictory to extant findings emphasising institutional difficulties (Suhir and Kovach 2003).

  • Proposition 3. DE is influenced by the combination of necessity and opportunity determinants that are perceived by the entrepreneur and are context specific.

This proposition was mainly supported (except case 5) while the role of opportunity was dominant, surprisingly, as necessity is an inherent feature in an emerging market context. Perceived opportunities assisted the entrepreneurs to turn their necessity factors into motivational determinants and fuel for the opportunity development. On the other hand, the study found a strong “immigrant effect” on their entrepreneurship enabling them to perceive and develop opportunities. This positive effect is very strong for the first generation diaspora, but may “transnationalise away” over time. This implies that the four leading conceptual perspectives on emerging country business (transaction cost, agency, resource-based and institutional theory) could be enriched with DE, explaining the relative insignificance of the effects of weak institutions, uncertainty and instability with its socio-cultural embeddedness and employment of informal institutions (cf. Wright et al. 2005).

The context of a transition economy host country presented its own dynamism as a determinant for DE; the entrepreneurs were well aware of the development rate and its impact on their venturing. While the diaspora entrepreneurs are dynamic, adaptive and mobile in many ways, the host country is immobile and constitutes an object for comparison. The developments of their markets affect the strategy of diaspora entrepreneurs, influencing diasporans’ perceptions of risk, trust and opportunities, but the contextual and socioeconomic embeddedness seemed to have a greater influence than just profit expectations. Indeed, some diaspora entrepreneurs have more choices, and in case of failure, they may select another strategy and exit. The interplay between DE entry choice and individual life includes several levels of dynamics and multiple mille-micro influence factors. The final choice to invest is a sum of many factors to create a “fit” in life, and here, it was not dominated by altruistic or homeland sentiments. The findings suggest that in the transition and emerging economy context, necessity and opportunity evolve hand-in-hand with the formation of the business environment (see Wright et al. 2005). Thus, it can be summarised that it is less the country-level determinants and more the constellation of socioeconomic elements and opportunities that stimulate DE location and target country choices.

The character of the emerging country of Uzbekistan, which has undergone numerous reforms and institutional changes towards a kind of market economy, is still more a transition economy. Uzbekistan has tried to focus on promoting private business generation, the simplification of business establishment, reduction of institutional uncertainty and stability creation, but DE policies are yet inadequate to tap the full potential. The post-Soviet era in which these entrepreneurs have started up represents an interesting phase in the development of an emerging country, and their experiences and narratives illustrate that they have perceived numerous institutional improvements. In fact, their views on improvement occurred naturally in data, surprising against previous literature. Due to their diasporanness, they were able to overcome obstacles easier than others did. Despite the deficits encountered and the inefficiencies of transition, all entrepreneurs have been at least moderately successful. However, the study is limited to eight cases of entrepreneurship and investment in the post-Soviet era and provides only some in-depth views without representativeness and statistical relevance.

A central element for fostering entrepreneurial activities and growth has been the significant gap in the markets after independence and the collapse of the Soviet system; this gap, along with the changed entrepreneurial circumstances, provided the window of opportunity to fulfil a dream or to create a new livelihood. This evolving gap attracted DE as a perceived opportunity. In total, the role of family and friends, in Uzbekistan and abroad, played a key role in making the plans viable. The influence of foreign ties on inward activities was particularly emphasised in terms of supply, business networking and knowledge transfer. The outward activities were mainly in the ex-Soviet markets and were thus “ex-home markets.” The ability to identify opportunities via the “immigrant effect” was validated, but it was also indirect, that is, from the diaspora network abroad, not necessarily the entrepreneur him/herself. The findings show that the diasporans were able to connect to the social capital and existing international experience and knowledge of their ties a priori and employed these capabilities in their establishment phase and resulting business operations. This behaviour had similarities to that of born-globals; however, due to the emerging context, the inward flow (Uzbek perspective) was more significant than the outward flow was. These companies were “born (inward) international” (cf. Kundu and Katz 2003).

The role of support determinant, i.e. institutions, chambers of commerce, trade organisations and universities, was insignificant. Dimensions that may be relevant to Western SMEs such as research-based spin-offs, campus entrepreneurs, student entrepreneurs, support and certification mechanisms for business incubators and results-oriented knowledge transfer offices (cf. Wymenga et al. 2012) were not relevant for the DE context in this emerging market. Ethnic community, family ties and even the cemeteries of ancestors were more important (i.e. social recognition). In general, diaspora ties were significant in sourcing, partnering and sales, with a particular effect on the establishment phase in overcoming institutional difficulties. The emerging character gave impetus to informal institutional structures.

The entrepreneurial behaviour was closer to Bolton and Thompson’s (2004) view of entrepreneurs than McDougall and Oviatt’s (2000) definition, since the entrepreneurial behaviour was mainly carefully planned and risk-avoiding or limiting, the level of innovation focused more on transferring an extant model/idea from abroad to Uzbekistan, and the proactiveness seemed to be quite limited in scope, whereas the talent, dreams and socio-cultural drivers were strong. The inward orientation was significant, and the value creation often had a clear direction to the company and the family behind it, even if the family members were not co-owners (cf. Elo and Jokela 2014). Despite its location, the influence of family was significant for the entrepreneurship, both as support and as a driver for success, due to responsibility and strategic importance (cf. Leinonen 2012; Vissak and Zhang 2012). The “item” of business was often linked to the entrepreneur’s dreams, education or competences and the emerging opportunity.

Finally, the differences of the determinants of DE in the different contexts (emerging vs. developing, COR vs. COO) and the respective types of DE (see Table 3) illustrate that future research is needed to develop determinants for each type of DE with enhanced contextualisation (cf. Michailova 2011).

Managerial implications

The individual diaspora experience, and even social and managerial networks prior to entrepreneurship, were important as sources of contacts, ideas, advice, finance, support, perspectives and information in the emerging setting. The cases indicate that the entrepreneurs also benefitted from the diaspora in their family, not just their individual experience. Thus, this “immigrant effect” in perceptions, comparisons and opportunity/risk management was extended and had positive effects that were shared and transferred in the family and among friends (e.g. Chung and Tung 2013; Riddle et al. 2010). Other livelihood/career choices than DE in Uzbekistan were discarded because of the perceived benefits of becoming an entrepreneur, but they require careful a priori understanding. Business networking with locals and community members in the COO and COR was highly important for the venture. The findings suggest that entering entrepreneurs needs to understand the emotions of the people in the emerging market context, which can be especially challenging to foreigners; it found that effect is not relevant only in regard to the COO, as Barnard and Pendock (2012)) claim, but also in regard to the host country (COR). This interplay influences the engagement and behaviour of diasporans and their willingness to become entrepreneurs and investors (cf. Barnard and Pendock 2012). The cases presented no “victims” (cf. Cohen 2008); instead, active and often growth-oriented entrepreneurs shared opportunities with business partners and benefitted the community as socially oriented entrepreneurs. The collective style in business and social embeddedness were more facilitating factors than constraints; this was actually referred to as part of the purpose of doing business (cf. Ali et al. 1997; Ellis and Pecotich 2001; Granovetter 1985). The success factors and differences between the mainstream Uzbek entrepreneurship and DE require in-depth understanding to safeguard a prosperous growth pattern for DE and to avoid socio-political fragmentation and inertia. More research is needed on socio-cultural determinants for management of DE.

Methodological implications

The researchers had severe difficulties in obtaining data, as many people mistrust the regime and have in general negative perceptions about questions, and there were language barriers. Irregular migrants are not willing to be recorded or photographed. An emerging market provides additional methodological troubles; therefore, the researchers recommend involving native researchers in such settings, as they found this to be the only manageable way to collect interview material. Trusted persons (cf. snowballing), clear research protocols and high ethical standards (visible to respondents) facilitated the process and decreased ethics and trust problems. For large-scale studies, local high-quality partner institutions would be recommended

Policymaking

There is a significant tendency to employ social networks for business within and between various ethnic groups. The assistance and usage of official, institutional actors was insignificant in these DE narratives, possibly reflecting the FDI programme of the state encouraging MNC entry only. Therefore, the study suggests strategy modification to promote and increase small and family business establishment by diasporans advancing international entrepreneurship. It recommends events that bring people with common interests together, especially with cross-ethnic emphasis to reinvent the Silk Road and lingua franca spirit for business. The rise of sub-groupings, which easily develop religious and political disharmony and harm the investment climate, should be met by creation of competence clusters, mentoring systems and cultural and knowledge transfer systems on the local level, with a virtual dimension on the internet. The data indicated that awareness of possible SME support programmes was almost non-existent, which does not facilitate catching-up. Promotion of historical competences and traditions in trade and economic cooperation could connect the older and younger population quickly for enhanced opportunity creation. There is a danger that the common business language in the area—Russian—will become less popular and thus create communication problems and obstacles for interaction (cf. Libman 2008). Beyond that, it is not enough if the Uzbekistan-based diasporans consist only of people with developing and emerging country backgrounds, as diasporic diversity can advance international trade. For example, the ability of repatriates to act as “foreign” investors seems to benefit international business suggestion further improvements for migration policy (Riddle 2008; Kotabe et al. 2013). The infrastructure and employment of the internet was not well developed, and this needs to be improved, as the internet has made it easier for smaller firms to overcome some of the barriers to internationalisation (cf. Internationalisation of European SMEs and Final 2010). Moreover, economic trade and investment incentives, the ramifications of entrepreneurship (e.g. DE) and the fight against corruption are aspects of common interest (cf. COO/COR). The external barriers and bottlenecks such as lack of capital, lack of adequate information and lack of adequate public support, as well as the costs of or difficulties with paperwork associated with transport and international business, require attention. Uzbekistan has potential for foreign-born DE, but it must be actively supported with a suitable institutional framework.