Key takeaways from Get in the Ring - Global Conference 2017 - Part 1
What StartUps need to know about scaling up globally...
On May 17th 2Sherpa had the honour to give a workshop and host mentor sessions for StartUp companies from all over the world. StartUp Companies from various industries and in different stages.
The participating StartUps had one ambition in common: to scale up globally.
Some of the participants:
- B2B Pay, state of the art financial solutions based on robust, reliable traditional systems provided by giants such as Barclays
- Bambi Medical, currently developing the Bambi-Belt for pre- mature babies
- Flex-appeal, helps organisations to unite their frontline employees
- Edupass, a web platform where students navigating the application process to pair with admissions experts from their target university and academic field for one-to-one mentorship
- ReFlex, part of the emerging technology in physical therapy and rehabilitation.
But are the StartUps ready to scale up? And what are the best strategies to follow?
In this article, we'll focus on the planning and execution of going abroad. Because before you start considering going abroad, you need to prepare this critical step carefully. 56% of the companies expanding overseas fail because of poor preparation and planning.
To avoid this, we use three pillars to scale globally:
- Your new market as your baseline: Understand the market and where your product fits.
- Product Needs and Gaps: International markets require product modifications.
- The vision of you and your company: What “being global” means for your business.
We'll share our experiences about the first topic - your new market as your baseline:
"this new baseline is needed as it's very dangerous to copy your business model in another country. To be successful, you have to set a new baseline to align strategy, organisation, etc. with the real requirements of the target market abroad"
The first step is to define this new market:
- Which markets are most attractive? Large or small?
- What are the substitutes/alternatives?
- What are the changes in the industry?
- What is the price competition?
- What are the cultural differences?
- How easy to get access to human resources?
- How to create meaningful relationships?
- How easy to get IP protection?
- What about the red tape?
After having answered these questions, your next step will be to prioritise the market. You can use the following:
- Segment the market by industry and main segments
- Forecast the drivers of demand in each segment
- Create scenarios and do sensitivity analysis
- What is the stability (political and economical)
- What are the lessons learned from competitors
- What is the level of market entry
- What about the readiness of my product
- What is the cost of entry
Based on these questions, you are ready to set the final step, which is the most critical, planning and execution of going overseas:
- How is the commitment of co-founders/investors/team
- What is my budget
- What about the planning & time management
- Which country is the most attractive
- What are the opportunities and risks
- Who are my main competitors I need to keep track of once I have started abroad
- How to market & distribution my products/services
- What is the ideal price level to gain market share, launch, etc.
- Can I get access to expansion loans, grants, etc.
- How can I set up focus groups to test the water
And even when the work is sound, though, uncertainties will remain: discontinuities will still be difficult to predict, especially if they are rooted in serious political, macroeconomic, or technological changes.
So it's what Benjamin Franklin said: "If you fail to plan, you are planning to fail".
Good luck with your business expansion!
Participating and supporting partners:
Singapore Exhibition & Convention Bureau, YourSingapore, EY, ACE, theCo, JustCo, Bash, DHL, SGInnovate, Quest Ventures, Expara, VenturesOne, KK Fund, Life.Sreda, Golden Gate, East Ventures, 2Sherpa, Startup Autobahn, Coent Ventures, Reapra Ventures, OCBC, 500 Startups
Jochem Cuppen +31624781603 [email protected] Skype: jochem.cuppen