Following a successful panel event with colleagues from Draper Esprit and PwC, Fieldfisher corporate partner Tom Ward shares some of the essential advice professional services firms offer clients targeting international expansion.
On 3 July, law firm Fieldfisher's Manchester office hosted a panel event in conjunction with venture capital specialists Draper Esprit and leading professional services firm PwC, to explore international expansion opportunities for Manchester-based businesses.
Speakers included experts from the event's hosts, as well as CEOs and Founders from some of the city's most dynamic companies.
Saurav Chopra, CEO and Co-founder at employee engagement platform Perkbox; Guy Weaver from SME funding and support specialist Praetura Ventures; and Wais Shaifta, CEO at online GP provider, Pushdoctor, each delivered thought-provoking talks based on their own experience of successfully marketing their businesses to international customers.
A key takeaway from the event was Manchester's significant and increasingly pivotal status as a springboard for growth businesses.
According to research by Data Esprit, Manchester is the single biggest employer of people in the technology sector in the UK outside of London.
The city ranks 16th out of 60 British towns for startups, attracting capital from international investors and government organisations every year.
Manchester also boasts 70,000 digital tech jobs, a combined £3.2 billion of local business turnover and over 500 tech business births since 2016.
However, Draper Esprit's findings highlighted the considerable gap between annual Manchester-bound investment and the sums commanded by London.
Last year, Manchester received just 2% of the UK’s tech funding and, in the latest Venture Pulse report published by KPMG, northern British businesses saw a 30% year on year drop in venture capital funding to £226.5m, from £327.3m in 2017.
The question that the panel kept coming back to was whether Manchester has the ecosystem to power businesses of the future.
As an entrepreneurial European law firm with a significant presence in Manchester, Fieldfisher, along with colleagues at professional services companies like Draper Esprit and PwC, are proud to form part of the support structure needed to promote the national and international growth of Manchester-based businesses.
In the last year, we have assisted North-West based seed stage and scale-up clients from biotechnology and pharmaceutical spin-outs to fintechs and digital technology businesses in obtaining venture capital finance and the commercial exploitation of their intellectual property rights, to international expansion via joint ventures, licensing and distribution channels.
Based on their shared experience of helping clients grow, the panelists came up with six key points that they felt were fundamental to local companies looking to expand:
- Culture
“Develop reasons for cross border communication”
Every company has its own culture. But to remain consistent across borders, you must ask yourself “Why would people join this company?” Be explicit- define and codify your values. Give people a mission and a reason to apply and give them something to get excited about - this will attract top talent. Having your mission and values codified and clear, with constant re-enforcement of those values, is crucial. There’s no shortcut to company culture and it must be defined early on.
When expanding internationally, send people who have worked at the office HQ to instill the pre-defined culture and ensure it carries across borders. Develop reasons for cross border communication, so teams in differing territories don’t feel disassociated.
- Product
“…ensure a solid product infrastructure before raising investment”
The worst thing you can do is expand too quickly without technical systems in place. Get marketing automation, sales automation, and other backend platforms secure to make for a solid product infrastructure before raising investment and scaling internationally, especially for B2B software companies.
- Product market fit
One of the biggest challenges is finding the right product market fit as you enter new markets. Fine tune and optimise the product to what local businesses really need, whilst remaining strong to your macro level offering. If you do this alongside consistent messaging, tailored to the country’s audience, you will achieve rapid scale.
- Approach the right VC
“It is essential to find a long-term partner that will really help you in your journey
Figure out what you need, when you need it, why you need it, and pick the right VC to work with before approaching anyone. It is essential to find a long-term partner that will really help you in your journey. Building a business always takes more time and capital than you assume, and you won’t necessarily end up where you plan to, so choosing the right partner is essential.
- When and where to expand
“…do not go international too soon. Be sure to make use of your home market and be patient”
Expanding to the US is a natural next step for UK entrepreneurs, but Asia is now on the cards for many. More than anything, international expansion is sector dependent. If there is a significant addressable market for your product, with strategic partners that are willing back you, then put a plan together.
But do not go international too soon. Be sure to make use of your home market and be patient - if you have great technology, a world class team, and large enough market, it will scale naturally. International expansion is expensive, so it is essential to be well funded.
- Locality
Category experts, who act as local heroes are essential for growth in the new market. Hire a salesteam to land and expand, who are native speakers and who understand cultural exchanges.
A massive thanks to our speakers and partners, PwC & Fieldfisher, who helped pull this event together. Find their profiles and companies below.
The above is an extract adapted from Draper Esprit's blog rounding up key findings from the co-hosted event. Their write up can be found here: https://draperesprit.com/news/building-an-international-business-here-are-some-top-tips