Research on business models in international entrepreneurship has picked up recently, yet more clarification is needed in explaining business model change in internationally operating small and medium-sized enterprises (SMEs). In this paper, we provide a more nuanced view of why and how the institutional environment influences international SMEs’ efforts to change their business models to respond to a crisis. We take the COVID-19 pandemic as the starting point of analysis and propose a conceptual framework that links the institution-based view of strategy with research on business model change in international entrepreneurship at times of an external crisis. The institutional lens taken in this paper contributes to explaining business model change in internationally operating SMEs during times of global shock, crisis, or both. The developed model contributes by serving as a foundation for future empirical studies examining business models, institutions, crisis management, and resilience for literature on entrepreneurship, small business management, and internationalization of SMEs.