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Five tips to starting a business in two hemispheres

Traditionally when someone looks to start a business they look to their own market; a place they know and are comfortable in. There are benefits though to starting a business in multiple markets.

It can be much riskier, but if your service can easily be replicated in multiple markets, starting in two places can provide big returns and fast scaling. With technology startups, transferring technology doesn’t usually require investment in shipping, and support can be provided internationally anyway.

My business is currently based in the UK with offices in Australia. We expanded into our Sydney base pretty early on, partly because I am Australian and had a good understanding of the legal, tax and business environment, but mainly because we saw an opportunity. Geographically, I’ll admit it wasn’t the most natural choice - time zones make communication difficult; most calls have to take place outside traditional office hours. The process did give us scale very early on, appealing to investors and customers alike.

Starting a business in two hemispheres doesn’t seem like the obvious choice, but if you’re willing to take the risk, the returns can be significant. Here are five tips for starting a business in two hemispheres:

  1. Be strategic

Our expansion to Australia was very organic and by circumstance and opportunity. However, future plans to expand into the USA, Germany and France are much more by design. What we’ve learned is to approach a new market with four essential criteria:

  • Size of the opportunity. Are there any prospective clients?

  • Ability and costs to access markets. Do you have someone with local expertise? (Having someone on your team who spent their gap year or went there on holiday doesn’t count).

  • Legal, language, technical or structural impediments. How are you going to deal with these? Do you need to bring in an expert?

  • Existing partnerships. Can you leverage any of these?

All these aspects need to be considered before expanding into new geographies.

  1. Hire someone good to run your operation on the ground

The most important step has to be securing the initial staff member who will lead the overseas team, and then investing the time in that person to learn about your business and support them as they build the right team. For us, since regional directors or country managers are typically salespeople, it was very important that this person was entrepreneurial with ability beyond the typical successful sales person.

For example, a country manager as far away as Australia is going to have very limited head office support for things like: office space, internet and infrastructure, recruiting, HR, performance management and marketing. The first person needs to be very tenacious in building a ‘mini-version’ of the mothership and be up for the challenge from day one.

  1. Make the most of economic cycles

One key benefit of operating in two markets is separate economies and policy, which allows startups to offset the economic cycle to carry the business early on. When we started Adthena, the UK was slightly depressed, but the Australian market was booming and the Australian Dollar was strong, which helped support our early growth. Later the UK rebounded and we saw a role reversal.

  1. Consider cultural differences

Some of the biggest international organisations have failed when expanding into new countries because they have not understood differences in culture. One of the most high profile in recent years was eBay. The American giant tried to copy its model in China, and was beaten by local player Taobao who understood cultural needs. Shopping in China is a social experience and eBay was seen as impersonal, failing to connect and build trust with Chinese consumers.

In some new markets, trust hinges on who you know, so building an extensive network of well established locals can be a real help, both for advice and to build a quality reputation.

  1. Establish effective communications

When you have satellite offices in different regions, finding the right means to communicate is essential. Different time zones naturally creates issues with regular calls, so we’ve found using collaboration software particularly helpful. Whether it’s unified communications or mobile messaging platforms, getting your lines of communication is key. We’ve found cloud software particularly beneficial at Adthena. It allows teams to collaborate on work and keep in touch wherever they happen to be.

A dual hemisphere approach to starting-up has been of real benefit to Adthena, and if you’re willing to take the risk I’d recommend it. The process can provide access to new clients, and develops a business enormously, forcing leaders to manage multiple markets. It also stands you in good stead for further international expansion down the line.

If you can make it work, the experience can only be positive, and won’t be lost on potential venture capital partners, who understand the global nature of business opportunities.

Ian O’Rourke, founder and CEO of Adthena (opens in new tab)

Image source: Shutterstock/ (opens in new tab)wavebreakmedia (opens in new tab)