Lessons For Start-up Globalization Early And Rapidly
Raamish Rana | 0 comment
In times of rapid globalization, it is important that start-ups are able to take advantages of launching themselves globally to take benefits of scaling, and do so as early as possible. With a focal point of technology start-ups this blog will analyze the work of Tony Bailetti to discover the important actions that are required from the viewpoints of management teams, and technology startup to launch start-ups globally. Tony has analyzed about 21 start-ups operating in about 12 countries, and identified 6 elements essential for start-ups to globalize early.
The rationale behind globalizing early is usually provided in that by globalizing early and quickly, start-ups are able to tap into new growth opportunities by: ‘reducing revenue source risks, raising the value of the start-up, and increasing the size of start-up’s addressable market’.
Hence a useful explanation of the 6 elements essential for early start-up globalization follow:
Problem scope: It is absolutely necessary to scope the problem at hand. A keen understanding has to be gained about the problems facing a large number of domestic and foreign organizations
Stakeholders’ commitments: The stakeholder commitment towards start-up growth is an important precondition. This provides for the ability of numerous key stakeholders to narrow down the scope of differentiated solutions with an aim of extracting a high customer willingness to pay for such solutions, making referrals, and extracting a higher customer feedback.
Collaborative entrepreneurship: This entails that a flexible worldwide collaboration is made of resources through transportation infrastructure, web-based transactions operations, and common resources enabling organizations/individuals to act quickly on business opportunities. Also systems should be as flexible and responsive to changes in market needs.
Relational capital: This requires building up of key relationships that will enable a company to quickly collaborate with institutions, entities, and individuals around the world. Relational capital can be leveraged to solve some of the pressing issues cost effectively, and efficiently.
Legitimacy: As a highly important element, legitimacy creates trustworthiness in the eyes of key stakeholders including partners, customers, suppliers, and investors that is important to strengthen relationships for future opportunities.
Global capability: It is important to have the ability to adapt to uncertain environments, together with willingness to deliver customer specific products/services and/or support programs regardless of the location where a company operates.
All the aforementioned elements including problem scope, stakeholder commitments, collaborative entrepreneurship, relational capital, legitimacy, and global capability are based on survey of 21 companies. Some or all of these elements are already found on some of the leading global businesses of the likes of web-based Amazon. Hence these offer useful starting point to understand important preconditions that can ultimately enable start-ups to grow quickly, and early in the process.
Source: Bailetti, Tony, “What Technology Start-ups Must Get Right to Globalize Early and Rapidly”. (http://timreview.ca/article/614)