Focus The study “A review of various approaches/theories that SME’s adopt to establish a network in international business” focuses on understanding the processes that may link an SME to a network relevant to its internationalization. The study discusses various approaches and analyses each approach and finally, the advantages and disadvantages of each approach are discussed. Introduction The advent of the Internet and the ensuing “new economy” has opened up a plethora of new business opportunities – and an “inevitable” number of business casualties. Shapiro and Varian (1999) argue that while technology changes – economic laws do not. Internet firms with non-profitable business models have been forced to shut down. According towebmergers.com a total of 135 companies in the US had shut down by December 2000, on the other hand, these were out of an estimated 7,000 to 10,000 private or public Internet firms (Businessweek 2000). Although share prices have fallen and the current value of Internet firms can be said to be closer to their true potential, the Internet will still play an important part in world business. It is important to remember that despite overvaluation, Internet companies have made a strong impact and probably will continue to do so into the future. The online retailer Amazon.com has only after 6 years of business grown to have sales of nearly $ 3 billion. Furthermore, both the portal yahoo.com and the auction site ebay.com are reporting profits and growth rates of up to 90% per year. All three companies have expanded internationally and are now among the world’s best-known brands (The Economist 2001b). Given the growing importance of both international trade and the Internet, this paper will discuss the emergence of born global Internet companies. A born global Internet firm is a company that can be said to fulfill three distinct characteristics.  1. The firm takes advantage of Internet technology to develop new and innovating products and/or services,  2. the firm conducts a major part of its core business functions online and finally  3. the firm is international already from inception. SME’s have taken the Internet as the safest route to internationalization. Various approaches/theories of establishing a network Network Approach A network is regarded as a potential means to facilitate an SME’s internationalization. Based on indications from a previous ESRC-funded project (Child, Rodrigues and Frynas 2006a), SMEs are likely to have a “core” relationship with a partner or agent in a given foreign and/or their domestic country which then links them into a wider “secondary” network relevant to doing business with the focal foreign country. For example, Bell (1995) observed that the network approach does not explain the internationalization patterns and processes of some firms which do not have any close connections or contacts with foreign suppliers or distributors. It also ignores the importance of decision-maker and firm characteristics in taking up opportunities for international penetration, extension, and integration that emerge from the networks (Chetty & Holm 2000). However, networks seem to have considerable significance for SME internationalization and their process aspects remain poorly charted. Internalization approach Transaction cost economics (TCE) has strongly