How to turn a UK startup into a global success
Andy Shannon, Head of Startupbootcamp Global
After establishing a successful business in the UK, the next step for many startups is to look beyond these borders and introduce their products and services to a global market. That said, not every business that sets out for global expansion succeeds. So what exactly must startups do to ensure they make the smooth transition from a domestic business to an international success?
Identify the right expansion country
It is important for startups to correctly evaluate a country’s market size before expanding into it. Startups can often wrongly assume a larger market equates to a bigger opportunity and head there without further thought. However, as market opportunity increases so too does local competition with the advantage of better market understanding and an established customer base.
That said, startups can overcome some barriers by simply taking the time to educate themselves on the local nuances before entering a market. Any intelligence a startup can gather pre-launch will help, which could be as simple as choosing a market based on where a founder’s family lives to gain local connections and insight. This will likely result in more appropriate product positioning and the higher ability to ‘hit the ground running’.
Hire the right people
Every startup struggles to hire and retain top talent in home markets, but staffing can easily become more of a challenge when expanding overseas. Not only do recruitment practices differ from country to country but businesses lack the ‘home court’ advantages of brand reputation, ecosystem presence and dedicated hiring support.
Recruitment agencies obviously provide local knowledge and can save time, but startups often overly rely on this type of external support. Optimally a startup’s founders should spend ample time in a new market to establish connections with many local resources. Taking part in local startup meetups, conferences and industry groups is time consuming but is an investment that can pay off handsomely in the long run. It can also help with other aspects such as market knowledge and customer development as well.
Ensure clear processes are in place
As a company expands, its founder/s won’t have capacity to manage the business and drive international expansion by themselves. Having a strong leadership team with a shared vision and capable of scaling is critical to maintaining quality operations in new markets.
All startups should begin developing processes and templates from day one to prepare for eventual growth. From staff on-boarding to sales, tasks carried out on a regular basis should be well thought out and clearly documented. Templates should also be developed wherever possible to ensure work is not repeated. For example, creating a marketing collateral library that is easily tailored to expansion markets can help align communications and build a consistent visual brand.
Set consistent communication channels
Managing international offices, different cultures, languages and time differences is challenging for any company. It’s simple to say ‘teams need to communicate regularly’, yet it’s difficult to execute well and absolutely critical to get right. Setting a policy of regular catch up calls with a structured agenda goes a long way to align a distributed team when face-to-face time is restricted.
Using a specific tool such as Trello or Asana across the entire team will aid project management, while having everyone on the same chat platform such as Slack or Whatsapp aids quick and informal communications across time zones. Even choosing a standard video conference tool such as Skype, Google Hangouts and GoToMeeting can save time and minimise connection difficulties.
Securing funding from US investors
UK startups often dream of cracking the US funding market, but with so many startups competing for limited capital, VCs often require a physical US presence. Merely saying “we plan to enter your market” won’t suffice. You’ll need to show tangible evidence your business is making the move across the pond.
While committing to a US presence and establishing relationships with US investors definitely raises a startup’s chance to raise funding, many fall short by thinking a quick ‘tech tourism’ visit will suffice. Flying to New York or San Francisco for a week and meeting a few investors will not secure funding. Startups need to invest at least six to nine months of their time consistently being on the ground and nurturing investor relationships to successfully raise US funding.
Don’t expand your business too early
Being the first to enter a new market can be a lucrative move, but many startups have failed by ‘jumping the gun’ on expansion before being ready. At the pivotal early stage of a business it takes a lot of time and energy to turn initial customers into repeat business. A management team’s full attention is required to truly understand their end user’s need before planning a growth strategy.
Expansion is an expensive process and a startup in search of a sustainable business model both at home and abroad can quickly eat into their cash reserves. Startups not only need to have plenty of cash reserves, but optimally they should have investors who could quickly react in the case that more funding is needed.
BUSINESS3 days ago
Philanthropy Is an Underrated Tool for Growing Financial Services Businesses
TECHNOLOGY3 days ago
Investment in mental health amongst cybersecurity professionals set to increase according to Infosecurity Europe poll
NEWS2 days ago
Bank shares rise after Credit Suisse rescue eases crisis
TECHNOLOGY2 days ago
Scratched EV battery? Your insurer may have to junk the whole car