Your startup is doing extremely well in Taiwan, so what’s the next step? Expanding to foreign countries may be a good option to consider. To further explore this topic and how to go about entering a new market, we have invited Benjamin Wu, one of our mentors and the co-founder of iChef (an all-in-one iPad-enabled POS service catered to restaurants), to share his experience in successfully expanding his startup into Hong Kong, Singapore, and Malaysia. Over pizza and beers at our monthly CEO Day, Benjamin covered some major subjects for startups with ambitions in expanding into international markets. Here we summed it up into 4 tips:
1. Know Your Direction and Your “Why”
Before deciding to enter into a foreign market, it is necessary to understand the reasons of your expansion, otherwise you may get lost in this world full of distractions. For iChef, Taiwan’s market size was too small, especially since they targeted a niche market. Also, timing played a big role – not only was there a huge demand for a more efficient POS system in foreign markets, but also there were few competitors, so they decided to go for it! Knowing their “why” helped iChef have a more strategic plan for expansion.
2. For Beginners, Start Safe
For startups aiming to go global for the first time, it’s probably a safer idea to start with countries which already have an international climate, reliable infrastructure, transparent regulations, and a similar culture to their own. In iChef’s case, they chose Hong Kong as their first stop. For them, it was a perfect country to start the challenge and test the waters in a foreign market.
3. Turn Foes into Best Friends
Do not underestimate the potential benefits of working with your competitors. Always meet your rivals if you have a chance. There might be possible collaborations such as partnering up or other business development opportunities in foreign countries. iChef always makes sure to meet their competitors at every conference and competition.
4. SEM and PR Give You Keys to the City
To build up your brand awareness and credibility, it is important to have a strong online presence. Optimizing SEM makes it easy for new users to find you online. It can not only boost your popularity in a foreign market, but also leaves a positive impression on your potential customers. Compared with other marketing tactics, it is the most efficient way to getting access to the local market and establishing a brand. In addition to SEM, Benjamin emphasized the impact of having good PR. “Do PR by attending international conferences and participating in startup competitions. They can earn you media coverage.” When he went deeper into international conferences, he added, ”We were not just there to compete, we were there to win.” After all, these media coverage and accolades make you more trustworthy toward local customers and help you build your international brand and credibility.
Q&A with Benjamin at CEO Day
After sharing his insights regarding international expansion, Benjamin answered some questions from our attendees in a Q&A session.
Q: What are you evaluating regarding next expansion stops? -Arnold from Hahow
A: ROI. A question we always ask ourselves: if we expand to this country, will our company still generate a positive ROI? If the answer is yes, then we’ll go for it. A rule of thumb is that making sure the company has reached a certain level before you decide to enter a new market.
Q: How do you defend yourself against local competitors? -Keegan from H3O
A: The timing to enter a different country is critical. For iChef, we had a really good timing. Back then, we had very few competitors in the APAC region and held first-mover advantage.
Q: How do you make local distributors commit and share the same passion? -Frank from HourMasters
A: Our distributors sell many kinds of products other than ours. What can we do to make them put efforts in selling iChef’s products? The key is to make them feel that it’s worth it. When clients buy iChef from the distributors, it also create leads for other products they are selling.
Q: How do you educate your distributors and clients? -Frank from HourMasters
A: We educate our distributors and clients in three different ways. The simplest is through online videos. For advanced training, we send our people over to assist and train local people for 3 to 6 months, or distributors/clients send their people for to Taiwan for and we split the expenses.
Q: For global markets, where does the cash go? -Jerry from GloDoc
A: It all goes to our local distributors except Malaysia’s goes to Singapore’s. The reasons are:
a) Normally taxes are high to transfer money to different countries.
b) For the transfer, don’t transfer by every bill, but do it termly or yearly.
Q: Did you regret turning down the huge offer from Chinese investors? -Arnold from Hahow
A: Not at all. Their offer was super tempting, but given their request that we should move everything to China, we’d rather not sacrifice everything and bet on this.
Interested in exploring more of the Asian markets? Well we have good news! TSS is taking several startups to Japan, Thailand, and Hong Kong in June and July for FREE. All it takes is to sign up for Rock the Mic Asia 2018 and give a 2-minute pitch to earn yourself a chance.
To join our CEO Days and be up-to-date with the startup community, apply to our Starting Lineup Membership program here, and we will see you next time!
Content for this article was taken from TSS’s monthly CEO Day, where we invite startup CEOs from our Starting Lineup program to discuss issues that are relevant to startups with global ambitions. It’s an awesome chance to meet other like-minded and ambitious CEOs.