In the event that you are considering crossing borders and entering new markets at your own startup or growing small business, you may wish to consider a few best practices that we have learned at our startup, Consero Group, to help you along the way.
Find the Right Country for Your Particular Business
When searching for the home of a new foreign office, there is no one-size-fits-all solution. Rather, the right destination for you depends on the particular needs of your own business. Factors such as what kinds of language are critical or useful, the cost of doing business, ease of market entry, the compatibility of the business environment with your current business model and practices, and access to the right amount and quality of relevant talent are perhaps the most important factors to consider. For companies with heavy investments in technology, it is also worth exploring tax advantages, as well as what rules may exist that are designed to protect your intellectual property.
One additional consideration that is a little less obvious is whether there already exists a thriving startup culture. Being surrounded by like-minded, globally outward-looking companies not only provides a community of peers who can lend useful ideas, resources or other strategic value, but it heightens the likelihood that the wide array of support services your growing startup may need will be available. These environments foster growth, and certain countries are further along in this area than others.
Find the Right People
Second, it is critical that you find the right people for your new office, which is a twofold effort. To begin, you must have the right people on the ground leading the charge. This does not mean simply recruiting the highest performers to do more of what works back home. Rather, your effort is much like launching an entirely new business. You are creating a new team with a new culture, and the office will quickly assume its own identity. As with your first office, whoever fills the initial roles will be the face of the business in your new country, and he or she could well determine whether your exciting new enterprise progresses as planned. As a result, you must choose carefully, taking the time to ensure that you have the right initial leadership in place.
In addition, once you have your designated leader, it is important to find the right local talent to round out your initial team of employees. In doing so, look for individuals who have the necessary skills and experience, and who also fit with your organization’s ethos, values, and sense of purpose. Just be sure not to exclude automatically any individuals who may look or sound different; part of the value of launching a new operation outside your borders is the ability to add new perspectives to the organization.
Finally, once you have the right people, it can be much easier to maintain a company-wide culture and shared set of mission and values if you send colleagues from the home office to work alongside the new team for a suitable period of time. Not only can this help you maintain a shared vision and experience internationally, but it can minimize the likelihood that the new team feels adrift at sea or otherwise second class.
Find and Follow Good Advice
Third, as with any new endeavor, it can be very helpful to have sound professional advice to guide you on your way. In crossing borders, you will likely need support from new partners in some or all of the following areas: legal, tax and accounting, banking, recruiting, real estate, and more. As a starting point, consider approaching the economic development agencies of the countries you are targeting.
At Consero Group, as we began focusing our search on Ireland and Scotland, we found great value in our discussions with their foreign direct investment agencies: IDA Ireland, Invest Northern Ireland, and Scottish Development International. And once we settled on the Republic of Ireland as the home for our next office, we put IDA Ireland to work for us gathering information and contacts for a variety of our Ireland-specific needs. The availability of streamlined advice through such entities give today’s startups a significant advantage over startups of the past, making overseas expansion much less daunting and significantly easier. Robert Glennie, Co-founder and Executive Chairman of NewGalexy, which recently opened Scotland’s first legal process outsourcing (LPO) centre in Glasgow, reiterates the value of centralized outside guidance in launching into a new country, noting: “Support from Scottish Development International (SDI) was not only a key component in our decision to build our new onshore LPO business in Glasgow, but a broadly supportive partner once we had launched.”
Last, once you begin vetting service providers, be sure to check references—particularly in the case of providers who will be tackling the most complex legal and tax questions you may have. It is very important for you to be confident in the advice you get from these entities so that you can focus on other things, and it is even more important that the advice be accurate. Launching a new office outside your home country can be difficult enough without having to deal with notices of regulatory violations or nasty tax-related surprises.
Going global can give startups an exciting edge that can accelerate growth However, in a world of complex and inconsistent regulations, differing business cultures, and fierce competition, the expansion into new countries is an endeavor that should be pursued with care and sophistication. Fortunately, others have gone before you and proven that it can work out well. And if you follow the above suggestions, you will be well on the way to putting your best foot forward in a location that makes sense, with talent driving the process, and armed with good advice that will allow you to grow beyond your expectations.
Paul Mandell is Founder & CEO of Consero, providing strategic leadership for the company with a rigid focus on excellence at every level of the business.
Gavan O’Farrell is Senior Director & Head of EMEA Operations at Consero, responsible for developing new partnerships for the business and expanding the company’s presence outside the U.S.