As a startup or small business, often time we feel that we don’t have the energy and resources to expand our market to a couple countries. Going global is an effort that is normally associated with a large company than a startup. Things have changed, however, as time and space are virtually compressed, digital divide no longer obvious, the rise of middle class citizens and the movement toward consumerism in a few countries have started. Jack Welch says it best:
Business is Global, not the geography. That's the only way to run the business
So, as a startup or small business, what would you gain by going global? Plenty.
- Expanding market. The US market is so crowded with products and solutions. For a given problem space, there are tons of existing business and startups that go after the market. By going global, it allows you to diversify. There is also much less competition outside the US, and the consumers are hungry for solutions. You’d feel you can breathe again.
- Tap into mass resources and expertise. Some countries could deliver quality product or service in much more cost effective way. While this has been true in manufacturing for many, many years, you see this in high tech sector as well. For example, Guppers team works closely with a few vendors in China to build LCD, LED display devices. It would have taken us months to produce what we’d like, and would have cost us 3x as much per unit.
- Raising capital opportunities. The saving rates in many countries are much higher than in the US. Many individuals have formed investing groups to allow them investing to companies, including foreign companies. There is much money sitting in the sideline, waiting to see great opportunities to invest. In the US, VC and angel funding is drying up, or reduce their activities dramatically. This is not the case, outside the US. Guppers gets many more inquires about investment opportunities outside the US then in the US itself.
Of course, going global is not easy. Each country presents unique challenges. I put together a few lessons learned which we hope could benefit others (see the presentation). A few challenges to keep in mind:
- Don’t spread too thin. Focus on couple countries first, and make sure your end-to-end solutions work over there. Then, you could spread to the neighboring countries.
- Go after simplest regions that you could penetrate. I talked about which regions you should go after first in the presentation.
- Business is Personal in many countries. Work closely with your local connectors or influencers. Finding the great partners in the local country is probably the hardest and most challenging if you don’t know anybody in that country.
- Culture, law and regulations, business process. This is where your local partner is invaluable to keep you informed what works and what’s not.
I love to hear your experience and comments. We can build a set of “lessons learned” which we can share, networking globally so that we could all benefit from huge global opportunities. Like always, contact me: [andy at gestone dot com].