The definition of a startup
Nowadays, it seems that the trendiest word is a “startup”. A startup is a company that’s in the first stage of its operations. They are companies or ventures that are focused on a single product or service that the founders want to bring to market and are often financed by its founders and may attempt to attract outside investment until the business gets off the ground.
Six types of startups
- Lifestyle Startups: Self-employed folks
- Small Business Startups: Feeding the family
- Scalable Startups: Born to be big
- Buyable Startups: Born to be bought
- Large Company Startups: Innovate or die
- Social Startups: Mission – Difference
When should your startup expand into international markets?
A founder in the United States or China can focus 100 percent on their home market and comfortably build a $billion business but smaller countries need to think internationally from an early stage. Startups from smaller countries often go global relatively quickly. Startups from countries with populations under 50 million tend to reach an international audience in about 1.4 years — twice as fast as startups from countries with populations of more than 50 million, which typically reach an international audience after about 2.8 years, according to VentureBeat.
They may only think about the international market at a late stage and may struggle to adapt their business accordingly. If it is ever going to get really big and build accordingly, a founder in Kosovo or Albania knows from day one that their business needs to be international. Outsourcing is an important key in startups.
How do we know when a startup is ready for international expansion?
You should look out for these four signs whether your products are physical or digital, whether you sell design services or mattresses.
1. Good financial health
Expansion is costly. But, when done well, it can have an amazing ROI (return on investment). Doing it well demands some initial investment. If your company is just getting capital-wise, it might not be the right time to expand.
A digital company’s expansion budget can’t be a handful of loose change while startups selling physical products might need to assign a larger budget to their expansion project.
2. A strong and stable team
Job instability is very common in the way startups grow. But, when you find the right people, and they reach and surpass goals consistently, you might be ready to embark on bigger challenges.
3. A valid position in your home market
You are not in the place for expansion yet if you’re not seeing good results at a local level ( even though it is not necessarily to start at your home country since it is online).
4. Market with growth potential
Growth potential is an investment style and strategy that is focused on increasing an investor’s capital. You can not turn on every edge of the world overnight.
Growth or Expansion
Set your own business model. Then, correctly research and analyze potential target markets. Besides general market conditions, study your competitors carefully and analyze how favorable or unfavorable your position would be, compared to theirs. What do you see that they do not?
To know your business is ready for expansion, make sure you have a strong and stable team, the capacity to hire specialists, and enough funding your business is ready for expansion. You also should consider in case your company has internal problems to solve before going internationally and if it is serving the local market properly.
An international expansion essential is a foreign market with growth potential and a clear need for your product.
Things to consider if you want to expand your business
Going global with a startup or business is as easy as ABC (although it still has its challenges), and for many winning entrepreneurs, their success has been attributed to their consideration toward international expansion right from the very start.
Use your business plan
During the time, there are a number of posts that cover the topic of writing a business plan in detail, some of the areas to consider will be:
- Business background
- Business model
- Market analysis and marketing plan
- Business analysis and financials
- Financial analysis and forecasting
Study the competition, both past, and present
It’s important not to just focus on those who have been successful, but those who have tried and failed because every entrepreneur will know to research the competition before entering a new market. There can be a lot to learn from past mistakes and you can put strength in place to make sure they aren’t repeated.
Get local knowledge
Having a good clasp of the local culture can not only help develop your understanding of local customers and customs but can help avoid any embarrassing or potentially damaging mistakes when dealing with partners and suppliers.
Common mistakes startup founders do:
- Building something no one needs
- Listening to the wrong people and not to the right ones
- Planning with no clear business model and without cash in mind
- Failing to plan
- Thinking that funding is the answer to all problems
- Starting a startup for the wrong purposes
- Relying on possibilities
- Not being ready to sell
- Partnering with the wrong people
- Not having the right balance