Export Knowhow

“Venturing abroad is often essential for startups.”

Philip Morger, Consultant for Internationalization at Switzerland Global Enterprise, explains how startups can properly approach their international expansion, what questions to ask and how to find the answers.

Philip Morger, Consultant for Internationalization at S-GE
Philip Morger, Consultant for Internationalization at S-GE

Philip Morger, Switzerland Global Enterprise (S-GE) supports clients with their business and market development abroad. Which companies are eligible for this offer?
In principle, we support every company – regardless of their financial resources or size. It is often SMEs that lack the necessary in-house knowledge and network for international business development. Supporting young companies that have high scaling potential is a particular concern of ours.

Is it necessary for startups to look abroad if they want to grow?
By its nature, Switzerland has a manageable market potential. For companies to be able to grow sufficiently in the medium term, venturing abroad is often indispensable. Nevertheless, the domestic market should not be neglected. It often makes sense to build up initial market experience and business partnerships in Switzerland, test use cases in practice and take these successes with you as a basis for further expansion abroad. However, simply “copying and pasting” won’t work. One starts from scratch in every market, where it is also necessary to test and learn. For example, it makes sense to use the iterative, agile approach that we know from lean startup.

How does S-GE support startups during their international market entry?
At the beginning, young entrepreneurs often focus on fundamental questions: Should and can I export? How do I venture abroad and which countries are exciting? What do I have to look out for from a regulatory and legal point of view? We help them to ask the right questions and find answers to these. These questions can concern, for example, clarifying regulatory requirements, evaluating suitable markets, classifying potential business partners, selecting the appropriate setup for market cultivation in the country or carrying out the first activities in the country. We have a team of experienced consultants at our disposal here in Switzerland. Together with the unique network of 27 Swiss Business Hubs and Trade Points in various markets as well as experts and market experts around the world, we are very well positioned.

“The right entry market depends on the business model, the value proposition and the startup.”

How can a startup finance its international scaling?
International business development is time consuming and costly. If startups do not already have the financial means, they should start a corresponding financing round.
Switzerland Global Enterprise is a public service organization and offers certain services such as initial information or country consultations free of charge. On the other hand, other services, such as the business partner search, are subject to a fee. Since S-GE fulfills the mandate of export promotion from the federal government, we are not profit-driven like a private-law association.

Which foreign markets are suitable for those getting started?
The right entry market depends on the business model, the value proposition and the startup. The company must clarify where customers can be found and which country has the best conditions to accelerate the success of the product. Your own abilities and possibilities are also important: Do you already have market knowledge of a country within the team? For example, does an investor have good customer access to a specific country? To what extent does the product meet market-specific requirements? It is clear that Germany and the USA are still top export markets for many startups. Sometimes, coincidences also determine the choice of country; for example, if a suitable business partner is already located in a certain country. It is mostly true that you should take it one country at a time.

“Startups need to know what their USP is and decide what use case they want to conquer international markets with.”

Does S-GE also analyze country markets for startups?
That's our specialty. In our free country consultations, we provide startups with information about the specifics of a market and the opportunities for the product in the target country, as well as regulatory requirements. On request, we can also prepare market analyses that highlight the characteristics, trends, key players, key customers and sales channels of a market.

What tips would you give startups who want to venture abroad?
1. Focus: Startups need to know what their USP is and decide what use case they want to conquer international markets with. In addition, they must consider which countries they would like to prioritize. It often turns out that deviating from this is resource- and time-intensive. There is a risk of a fragmentation that a startup usually cannot afford.
2. Test: Before making a final decision, a startup should test its market opportunities. A trade fair participation, a targeted social media campaign or a placement on a local online marketplace can provide important clues as to whether a product has local potential.
3. Networking: Startups should get to know local players and exchange ideas with Swiss companies that are already present there. These can provide the best information on how companies have to adapt to the respective market and which cultural particularities characterize local business life.

This interview with Philip Morger was held during the Startup Night Winterthur on September 20, 2019.

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