Navigating foreign markets with purpose: Effectuation logic in the internationalization of sustainability-oriented startups

Sustainability-oriented startups seek to scale their social, environmental, and economic impact through foreign market entry. In doing so, ventures face extreme uncertainty arising from the combined challenges of early venturing, internationalization, and impact creation. Although entrepreneurial decision-making has been studied through the lenses of predictive planning, means-driven logic, and their coexistence, there remains a limited understanding of how these logics interact under complex, overlapping uncertainty. This study addresses this gap by examining how sustainability-oriented startups navigate internationalization decisions and how effectual and causal reasoning support them in resolving market-entry challenges. To achieve this, a qualitative study was conducted, drawing on data from 40 sustainability-driven startups engaged in international expansion into emerging markets in the context of a market-entry support program. The analysis reveals that in conditions of extreme uncertainty, such as those of internationalization of sustainability-oriented ventures into emerging markets, effectuation forms a strong core in the configuration of strategies used to resolve challenges, while causal logics serve to stabilize, resource, or close the effectual action. The study also underlines the hybridity of rationales behind market selection, where causal considerations around market conditions are inseparable from effectual stakeholder engagement and early commitments. Finally, the findings unveil how sustainability orientation manifests in market selection and effectual pivoting. Based on these insights, the study offers practical recommendations for entrepreneurs, policymakers, and support organizations to design targeted interventions and tools that enhance the internationalization efforts of sustainability-oriented ventures.