Take your business global: Ten tips to help Aussie startups make their mark overseas
Monday, September 9, 2019/
Today, many Australian startups go global from day one. With the tools to find overseas customers, cloud-based service platforms and digital marketing campaigns, it makes sense to pitch straight to a global audience.
But challenges remain. How do you find the right in-country partner? How do you build a product-support network? How do you connect with the industry leaders who can give your Australian product or service a global edge?
Austrade’s Landing Pads programs helps startups and scale-ups grow overseas with 90-day residency programs. Here’s our top 10 list of considerations for globally ambitious startups.
1. Assess your business
Analyse your business for the key pillars you need to support any massive change.
For instance, do you have enough human resources, both locally and offshore, to expand? Do you have the skillset to navigate the local customs and business practices?
Are you set up technically to manage teams in different locations? Do you have enough funds to support the move and maintain your home base?
2. Test the local market first
Adam Friedman, founder and chief of Amplifier Corporation, expanded his Shareable Apps business from a concept to servicing over 16,000 clients worldwide.
He chose to move to Singapore and raised money there. But his advice is to not jump the gun, and make sure your product works in the local market first.
“Australia is a great test market for getting your product and business model right, which helps to validate your proposition before you try to duplicate it,” Friedman says.
3. What are your risks?
Any good business plan takes risk into account, and the same goes for global expansion. Consider the types of risks you’ll need to plan for when moving overseas, including:
- Exchange rate fluctuations;
- Repatriation of profits;
- IP protection;
- Data security;
- Labour; and
- Infrastructure quality.
4. Select the right market
Not every market is conducive to every product. Consider economic, political, industry and demographic factors before you pin a possible expansion.
Nigel Blair of E Agri, an indoor vertical farming business, analysed multiple locations equally before deciding on China.
“Be smart about where to locate your company, look down all the paths and identify potential bottlenecks in the supply chain,” Blair says.
5. Know your competitors
Understand your competitors in each of these three categories:
- Direct competitors, who offer the same or similar products;
- Indirect competitors, who offer substitutes; and
- Future competitors, who may move into your market later on.
6. How will you gain customers?
Different markets favour different sales channels. Think carefully about channels such as print media, online pathways such as social media or direct email marketing, or even partnership negotiations.
Dig into the available data and marketing research for your chosen market before making concrete plans. For example, a Facebook campaign successful in one country may not work in another.
7. Mode of entry
Will you export directly or create a local office? This is heavily dependent on local infrastructure, so be prepared to scout as many locations as possible, or hire someone who can do it for you.
The costs of a local market go far beyond wages and taxes.
For instance, do you understand the average disposable income of your target customer? How mature is the industry? What are competitors charging? Do you have exposure to currency fluctuation?
9. What are the legal ramifications?
In so many cases, business owners exporting to new markets simply don’t know what they don’t know. Andrew Barnes, co-founder of GO1, moved into Southeast Asia but even with local tax advice, he still encountered several challenges.
“The accountants that we had appointed in that region were not necessarily well versed in international ownership structures and the unique obligations which come from that,” Barnes says.
“We’ve now established new relationships with advisors in each of our international regions.”
The lesson? Pick the right people.
10. Set yourself up to scale
Simply reaching a new market is an achievement in itself, but it will all be for naught if you don’t set yourself to scale properly. Think carefully about your scaling strategy for each market.
For instance, do you have enough capital? Are sales likely to increase? Have you optimised and fine-tuned the way your business actually runs? Is your customer pipeline healthy?
Expanding globally is an exciting goal. But don’t take a shot in the dark. Follow these steps and do it properly, so you succeed the first time.
Australian Landing Pads helps market-ready startups and scaleups take their business global. The program offers businesses the opportunity to spend 90 days in an innovation hub in one of five spectacular locations: Tel Aviv, Shanghai, San Francisco, Berlin and Singapore.
Think your business might be ready to take the next step? Find out more today.