lean internationalization - how to enter international markets without breaking the bank
TRANSCRIPT
LeanInternationalization-
ExpandinginternationallywithoutbreakingthebankByJanSauer,Partner@Katapult Group
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Topics• CharacteristicsofforeignfirmssucceedingintheUSAasnotedbyKatapult Group’sworkwith300+firmsenteringtheUS-market• Shareanewmethodologyyoucanusetoapproachnewmarketswithlessrisk:LeanInternationalization• Workareal-lifecaseofNorth-AmericanmarketentryusingLeanInternationalization• Q&A’sanddiscussion
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Katapult Group– globalbusinessbuilders
WWW.KATAPULTGROUP.COM
OURBLOG:WWW.SUCCESSINTHEUSA.COM
WEARE"SERIALENTREPRENEURSIN-RESIDENCE".THEBENEFICIARY:OURCLIENTS. LEANBUSINESSBUILDING =OURPROPRIETARYMETHODOLOGYCOMBININGDESIGNTHINKING,LEANSTARTUP,SALESANDOPERATIONALEXCELLENCETODELIVERTANGIBLERESULTSFASTER.WE'VEDELIVERED IMPROVEMENTS,EXPANSIONANDINNOVATIONTOFORTUNE100'S,GOVERNMENTSANDNON-PROFITSANDSTARTUPSALIKE. THEIRBUSINESSTHROUGHTHEUSEOFSTARTUPMETHODOLOGYANDCADENCE,TECHNOLOGYANDRELATIONSHIPS.CLIENTSINCLUDEFORTUNE100'S,GOVERNMENTSANDNON-PROFITS,ANDSTARTUPS.
WEBRINGPRAGMATISMTOINNOVATIONANDGROWTH.THERESULT:TANGIBLEANDSUSTAINABLEINNOVATIONANDGROWTHDELIVEREDFASTERANDATALOWERTOTALCOST TOOURCLIENTS.
Areallifecasetostarttheday–
workingcaseinapplyingLeanInternationalization
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• BrazilianERPgoingtoN.A.• Highcomplexitybusiness• Longsalescycles(>2years)• Owner=maindealmakertoday• Planforexpansion:• Sendteamof4BrazilianA-teammemberstoN.A.HewillstillstayinBrazilincludingtechnicalsupport,Acc.Mgt.,Sales
• ExecuteexistingsalesprocessfromBrazil• Setupcompany,admin,etc.• Expend~USD500,000 peryear• “Calculates”tosellaproductwithin1-2years=revenue~500K
• Whatdoyouthinkaboutthisplan?(1-10intheapproach)?
• Whatisimportantforsurvival?
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Background
PitfallstosuccessintheUSA
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Biggestpitfalls• LackofExecutivebuy-inandsupport• Lackofsupportfromthehomeorganization(ex.Techsupport)• Lackoffocus• Everythingvsonesstrengths• Allsegmentsvsperfectcustomer• AllUSAvslogicalscope
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Biggestpitfalls• Emphasizingthewrongthingsatthewrongtime• Teamisdoingmanynon-importantthings• Non-competitiveprice/value• Thinkingtheproductwillsellitself• Forgettingthesoftaspects
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CharacteristicsoffirmsthatsucceedintheUSA• Segments:• Understandswhotheirperfectcustomeris• Focusesonnicheandexpandsfromthere(beachheadapproach)
• Product/Servicecharacteristics• Stronganddifferentiatedalongonerelevantcompetitivedimension• Strongprice-valuebalance• Focusisonsucceedingwithonesolutionbeforeexpandingtheportfolio
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CharacteristicsoffirmsthatsucceedintheUSA• Organisationandteam:• USAmarketisapriorityfortheCEOandBoardofDirectors• USAleadpersonisoneofthecompanyfoundersoranexecutivewith5+yearshistoryatcompanyanddeepandtrustedrootsacrossthehomeorganization
• 24/7attitudewithanabilitytoexecuteontheplanbutlearn,changeandadapttofindproductmarketfit
• SeestheUSmarketasamarathon,notasprint.LongtermtheUS-marketisconsidereda“must”
• DedicatedpersonchampioningandsupportingtheUSAmissioninthehomeofficeonadailybasis
• US-Founder=Heavilychargedwithcustomerengagement• Recruitshelp/Outsourceslessvalueaddedactivitiesincludingadmin,bookkeeping,etc.
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CharacteristicsoffirmsthatsucceedintheUSA• Financialsandfunding:• Wellfunded,financialrunwayfor24-36months• Extremelyleanoperationuntilproduct-marketfithasbeenfoundandcansupportscaletheUSA
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Operationsandpeople:• USleadershipandtheoperationreceivesextraordinaryamountofvisibilityandpriorityathomeintheinitialyears• HigherdegreeofinteractionbetweenHQandUS-marketoffice,I.e.meetings,visits,calls,other• Emphasizecustomerengagementpre- marketentryandcontinueputtingsalesastheprimaryactivityduringgrowthofthefirm• Focusisonsmallandfrequentwinsthroughoutthecompanybuilding
CharacteristicsoffirmsthatsucceedintheUSA
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Workingcase
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Areallifecasetostarttheday
• BrazilianERPgoingtoN.A.• Highcomplexitybusiness• Longsalescycles(>2years)• Owner=maindealmakertoday• Planforexpansion:• Sendteamof4BrazilianA-teammemberstoN.A.HewillstillstayinBrazilincludingtechnicalsupport,Acc.Mgt.,Sales
• ExecuteexistingsalesprocessfromBrazil• Setupcompany,admin,etc.• Expend~USD500,000 peryear• “Calculates”tosellaproductwithin1-2years=revenue~500K
• Whatdoyouthinkaboutthisplan?(1-10intheapproach)?
• Whatisimportantforsurvival?
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LeanInternationalizationUsingLeanBusinessBuilding®tointernationalizeyourfirm
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KeyprinciplesofLeanInternationalization
• Continuouslyrankandtestthebiggestrisksassumptions• Doonlythemostnecessarytoachievetheabove
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BenefitsofLeanInternationalization?
• Primarybenefit:Acceleratetimetocash-flowpositive• AcceleratestimeittakestodefinetheattractivenessoftheUSmarket,i.e.Govs.No-go• EntertheUS-marketatatfractionoftheinvestment• HigherchanceofsurvivingYearOneintheUSA• Strongerfoundationandincreasedoddsforlongtermwinningbusiness
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OurBrazilianERPproviderneedsYOURhelp!Let’shelphimde-riskbyusingLeanInternationalization• BrazilianERPgoingtoN.A.• Highcomplexitybusiness• Longsalescycles(>2years)• Owner=maindealmakertoday• Planforexpansion:• Sendteamof4BrazilianA-teammemberstoN.A.HewillstillstayinBrazilincludingtechnicalsupport,Acc.Mgt.,Sales
• ExecuteexistingsalesprocessfromBrazil• Setupcompany,admin,etc.• Expend~USD500,000 peryear• “Calculates”tosellaproductwithin1-2years=revenue~500K
• HowwouldyoutellhimtoapproachN.A.usingLeanBusinessBuilding?
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FrequentlyAskedQuestionsinrelationtoenteringtheUSA• Howtofindpartnerstoactasaconsultingpartnersforourprospectsandleads?• Culturalissuestotakeintoconsideration?• HowtoselltoEngineeringDepartmentsofManufacturingCompanies?I.e.howtoreachandengagethem,amongstothers.• Howtodealwiththemarketandprovethevalueofyourofferifyoudon'thaveanationalsuccesscase(US)butyoudohaveinternationalsuccesscasestopresenttocustomers?• Whatdoesitcosttogetsetuplegally?• Whatarethebiggestlegalissuestoconsider?(WewilldoaseparateseminaronLegalissues)• Wheretosetupouroffice?• Totalcostofrunningthebusiness