Over the past few weeks the Smith School of Business and Dingman Center for Entrepreneurship have welcomed MBA students from Peking University, our partner school in China. Their enthusiasm for everything American – our universities, our financial markets, our TV shows, our music (apparently John Denver in particular) and especially our MALLS – further highlighted the disproportionate interest foreign individuals and firms have in the U.S. compared to our interest in them. This fervor is not unique to Chinese visitors as we host delegations from around the world that are anxious to learn anything they can about how we teach entrepreneurship and incubate startups. Yes, it is flattering that other countries want to learn from us– but are we doing enough of the same? Beyond outsourcing developers and finding low cost manufacturing, are our entrepreneurs doing enough to become global entrepreneurs?
I’m going to venture an educated guess and say “no, not really”. After speaking with hundreds of entrepreneurs in the past few years, there are only a handful that are tackling a problem also experienced in Brazil, leveraging technology developed in Israel or are targeting customers in China. One of those handful, Dingman portfolio company CirrusWorks, immediately peaked the interest of our investors by first targeting Asian markets. Although their unconventional approach to testing their product in a foreign market appeared naive to some, other investors welcomed the contrarian strategy since most startups begin locally and then diversify abroad as they grow. Since the U.S.’s growth rate ranks #127th , I’d argue that more startups need to take a “World is Flat” approach to launching their businesses. Given such feeble rates, startups may never experience the double-digit domestic growth rates that are typically viewed as milestones and therefore may never explore the global appeal of their product.
While exploring this issue with distinguished startup professors at the Smith School, I learned there are some exceptions. They pointed out that recent research has shown an uptick in transnational entrepreneurs, immigrants to the U.S. who leverage knowledge of the U.S. and their home country to start global, high tech startups. It makes sense that those knowledgeable and comfortable with multiple markets would be more likely to embark on a global venture. However, as a whole, U.S. entrepreneurs need to change their mindset to take advantage of international trends and opportunities:
Think global, start local. Startups need to understand and solve global problems. Uber launched in Paris in 2011, before many major U.S. cities, demonstrating the global pain point of inefficient taxi service.
Find comfort in what is uncomfortable. Talk and learn from people from different cultures. Travel to places with language barriers. Get lost on subways and experiment with food. The ability to partner with international companies and comfort travelling to meet a potential customer will give you a competitive advantage.
Understand Every Business is a Global Business. I repeat. Understand every business is global business and every entrepreneur is a global entrepreneur. For those of you who use the business model canvas as a planning tool – think of your canvas and look at which box represents a global opportunity. Is it a customer segment, a manufacturing partner or a distribution channel?
As entrepreneurs, advisors and investors, let’s learn from our zealous global peers. They are certainly learning from us.
Elana Fine (@elanafine) was appointed Managing Director of the Dingman Center in July 2012, after joining the team in 2010 as Director of Venture Investments. As Managing Director, Elana’s primary focus is leading the Dingman Center in support of its mission and strategic plan. Key responsibilities include oversight of our student venture incubator, Dingman Center Angels investor network, business competitions, and technology commercialization efforts. Elana also develops and maintains relationships with donors, board members, EIRs, the Smith School community and other campus and regional partners. She is also serving as co-chair of the Dean’s Task Force on Entrepreneurship and Innovation and will be working with our Academic Director to expand the Dingman Center’s research activities and curriculum development.