Expanding your business globally is inevitable for ambitious New Zealand tech scale-ups. It’s not a case of if, only when. However, there are many factors that you need to consider before attempting to enter new markets.
Today we’re going to take you through some of the challenges that NZ tech scale-ups face when it comes to international expansion and how, with careful thought, strategy and expertise, you can set yourself up for global success.
Firstly, you need to address organisational knowledge gaps. You could have the strongest team on the ground in NZ, but if they lack international experience, relying on them through the global expansion process adds unnecessary risk. To mitigate this risk it’s important to consider making high-quality executive hires in the country you want to expand to. These can be done on a fractional, advisory or permanent basis depending upon budget and speed to market decisions. Sending inexperienced staff members over to a new market or hiring badly can set you back years & cost much more than just wasted funds.
Many companies underestimate the complexity of the international markets that they are trying to break into. New Zealand is incredibly small compared to the rest of the world. Factors like the country’s tech ecosystem, access to talent, and supportive and restrictive regulations all play a vital role in validating a new market. You need to get all of this bespoke data compiled and must inform good decision-making, or it’s just guesswork. This will inform your GTM plan & forward thinking.
Often, Companies don’t budget properly and have enough capital to execute a great plan. Many vastly underestimate how much capital they’ll need to expand to new markets successfully & expect revenue growth to be earlier than it normally is. To tackle this aspect, you need a robust cap raise & a realistic route-to-revenue plan with contingencies in place.
The foundation of our client methodology is based upon robust market insights and data. Data should underpin every major decision that you make when it comes to international expansion. Without it, you’re essentially shooting around in the dark and hoping you’ll get to where you need to be. The research that we undertake during the market validation process helps companies to make an informed choice as to whether international expansion in their chosen market is right for them at that time.
Many NZ companies try to go global without doing enough research into PMF, competition or customer insights data. Their DIY approaches tend to end in failure or partial success, costing companies not only money but often years of valuable time.
Building the right plan takes experience and knowledge. If you or your team have not yet built an international expansion strategy, find someone who has and engage with them on a commercial basis to get the best possible plan in place.
Once you have validated the market and made an informed go/no-go decision, now is the time to make strategic hires. Getting the right people into the right positions in the new market is essential to your success.
Many NZ companies choose to scale into markets like the UK, believing that they can surpass the time zone issues by flying back and forth between New Zealand and the UK. Not only will this ruin your physical and mental health through burnout, but it’s not a sustainable way to scale your business internationally.
To enter new markets successfully you need to consider a hybrid approach of sending a key person from your team (export your culture) and hire the right people in the country you’re expanding to. These hires will bring invaluable experience in the new market and your ‘key person’ will bridge the culture gap (at a country, product and company level). We have supported all kinds of NZ-based tech scale-ups to make strategic hires that have been critical to their global expansion success.
For example, we helped the successful Regtech company FirstAML to quickly and effectively validate the UK market, assess their customers’ wants and needs and helped create a good product-market fit. This allowed them to scale confidently into the UK and secure target customer leads as a direct result of our outreach.
Deciding to scale internationally is a daunting step that has many moving parts. To help you to feel better equipped to make an informed decision, we’ve developed a short readiness self-assessment activity to help you to reflect upon and improve your current global expansion strategy.
As a UK-based Kiwi, our Founder Peter Gillingwater understands the unique complexities that NZ-based tech scale-ups face when it comes to expanding globally. As a team, we’ve helped many to successfully scale, by focusing on robust research, high-quality data, and the right talent.
If you’re interested in working with us, get in touch at email@example.com.