My 2 Cents | #12
How to Swim in New Waters Successfully. Let's Talk About Business Expansion
21/02/2024
Opinion of the Advisory Principal Gianfranco Miranda
Some businesses are not made to be confined to just one place; they are meant to explore new waters. If you have noticed that you and your business are ready to expand and are seeking guidance, let me help you get started. 👇
Here are the 5 key decisions you need to make before diving into the unknown:
🔹First, decide on the location for expansion. It can be a potential city or state inside the US or even other regions of the world. The decision for expansion must not rely solely on your business potential feeling but should also be accompanied by information about the market and its behavior regarding your product or service. It's not just about the place, but also whether your investment will bring the expected return on investment (ROI) or any ROI at all. 📈
🔹Second, finances. If you currently have the funds to expand and have already covered the potential ROI in the expansion, I would encourage you to take the plunge, but with a safety net. In this case, the safety net is the strategic expansion roadmap that you must follow. It will guide you and indicate whether you need to exit the venture if you find yourself unable to navigate the waters. Expansion is not for founders who shy away from risks. If you don't feel capable of making the investment to expand your business, don't do it, as you may encounter difficulties along the way and sabotage your adventure. 🏦
🔹Third, people and technology. If your business relies on technology, and you have most of your workforce working abroad, you can consider embarking on this new adventure. However, pay attention to three main things: language, local regulations, and market knowledge. These aspects need to be addressed, especially when doing international business without planning for local business registration. If your business depends on people, and you plan to establish a new office in these new waters, I would advise having someone trustworthy from your company who understands how your business works. Collaborate with them to select a key executive capable of running the business in this new place. Selecting someone on the ground is critical, as you will need to exert significant effort for the business, and the knowledge provided to run the business will be crucial to avoiding failure in the effort to expand. 🌐
🔹Fourth, market product fit (solution fit). You may have something that works in the current market, country, and region, but that may not be the case in this new adventure. For example, if you are a technology company from Latin America and you are trying to expand to the US, consider that the business operations and expectations in your day-to-day operations may differ significantly. In these cases, an external advisor can guide you to change the way the business operates and set everything in motion to expand the business before burning bridges with potential customers, clients, and partners. Also, consider that your product may have legal aspects that need review. From fintechs to Consumer Product Goods, you need to review regulations and make product adjustments before presenting and negotiating in the market; otherwise, you may lose much more than the investment made for the expansion. ✍️
🔹Fifth, and lastly, mindset. The decision for expansion stems from the mindset of the founders. If you are willing to challenge yourself, this is a perfect fit for you. If you do not feel comfortable or have second thoughts, maybe it is not the time to make this effort, and you should wait a little longer before expanding. 🧠
Remember, if you are up for the ride, you should definitely take it. If you need assistance navigating these new waters, we at Disrupt are more than happy to help. Contact us at contact@disruptintl.com.
