Scaling internationally is often a key goal for tech companies and the perfect opportunity to promote faster growth. It is exciting and the next logical step in expansion.
And yes, scaling in Asia Pacific is great, if you get it right. It raises your global profile, adds a few exotic office locations to visit and gives you the opportunity to enjoy the local cuisines. But it is not always a straightforward journey – it can fail fairly quickly and cost a lot of money.
I am no stranger to scaling businesses across Asia Pacific, having been in the region for more than 10 years, and in Singapore for the past 6 as Managing Director for Winnow Solutions, an AI company specialising in food waste reduction. I was part of the founding team and the first employee on the ground in Asia; my team and I quickly grew the operations to 15 countries in the region through 3 rounds of fundings.
So now as Head of Asia Pacific for Tech Nation, here are a few tips that I would like to share with any UK tech scale ups looking at expansion in the region. These are based on my experience, and that of my network in Asia Pacific – things learnt from what we did well and what we did not!
Top tips for scaling in Asia Pacific:
- Network, network, network!
This probably is true globally, but even more so in this region. The good news is that there are lots of ways to network successfully and efficiently – either through your existing network (LinkedIn is your best friend), on the ground resources (including the UK Department for International Trade, Chambers of Commerce, entrepreneur groups) or at events. And hopefully at some point in the near future, it will be possible to spend time in the region and actually meet people face-to-face!
- Do your homework beforehand
It sounds obvious, but make sure that you have researched, in detail, your product-market fit. Replicating what you have done back home won’t be sufficient. The first step I take is to look at a high level top-down analysis of the region and the opportunity to scale. I use metrics such as a general SWOT, GDP and population of the market, and then further measures such as the education and literacy level of the population as well as presence of target international clients, the tech investment ecosystem, number of local startups and available talent. I would recommend also looking at the complexities of operating or opening a subsidiary, as well as potential local partners or resellers.
- Asia Pacific is not homogenous: understand cultural differences in markets
Asia Pacific is not just China. There is often a misconception that expanding to Asia is expanding to China. Yes, China is the most populated country in the region and the 2nd largest economy in the world but it does not represent the rest of the opportunities in Asia Pacific. Southeast Asia alone represents nearly 10% of the world’s population, in ten separate markets, each with different languages and different cultures – and that doesn’t include the diversity and opportunity of Japan, South Korea, Australia and New Zealand. It is an amazingly diverse region, and so should not be approached as one market. We focused on Australia as one market, and ended up being able to enter the market “the right way” with a key customer and the right partner ensuring the right support and revenue to cover our growth.
- Be agile and measure what matters
Your plan is never going to be perfect. Your company is never the same as another, and ecosystems change quickly. Don’t get stuck ‘sticking to the plan’ and instead treat your entry to Asia the same as you would a product – constantly evolving. The important thing is that you know where you are going and you are measuring yourself against it. Setting your KPIs and OKRs is key for your success, and it should not be limited to your business development only – it should cover cash, talent, customer success and product.
- Think big, start small
It is better to start with one location in Asia Pacific – use this as your entry market and a case study for the rest of the region. It doesn’t even have to be a whole country, it could just be a major city.. You can then quickly leverage the knowledge you have learnt to the rest of your growth across the region. Key to this is to come up with an OKR for your first market growth before looking at further expansion across the region. Once you have hit this figure, you will then have a much better idea of what you need and how much regional success will cost you.
- Find your key talent
Hire slow, fire fast – if you do not have the right local talent around you, you are destined to fail.
- Find the right partner(s)
Do not go alone. You do not need to reinvent the wheel. A lot of people are very good at doing certain things. Understand where you need the most help and find the right partner(s) to support you on that. This could be hiring or external services providers.
- Do not neglect the boring stuff early on
The devil is in the details – setting up your entity properly, with the right local requirements, banks, import/export licences, tax implications, compliances etc, is very important (boring yes, but important). And, do it early, as it is much easier to do it right at the beginning than later when you have larger operations in the region.
- Do the math – make sure you can support your expansion
You need to ensure that you have enough cash in the bank to support your expansion plans – input it into your current fundraising (perhaps via a local investor), or ensure that you have revenue guaranteed in the region from existing contract(s).
- Have fun and embrace the culture
It is not all about business, make sure to ask about local culture, hire locally when you can, try the food and have fun! It is a lot of work to grow here, so you may as well enjoy it along the way!
Finally – do not be afraid to fail, but you are scaling a company.. you know that already.
And most importantly, Tech Nation can now help you with your international expansion into the Asia Pacific region – whether that be market intelligence, market entry support, highlighting business opportunities or matching you to partners, investors and government agencies. We also have a whole network of Tech Nation Alumni who have successfully scaled overseas who we can connect you too, so you can also hear their top tips!
If you are looking to expand to Asia Pacific, please email us at firstname.lastname@example.org and we look forward to helping you.
By Max Pourrat, Head of Asia Pacific, Tech Nation