Global expansion is the dream of many an entrepreneur, however there is no straightforward formula to follow for growing your business. Following on from part i of our Finspirational Series, we talk to Fred Schebesta, the CEO and co-founder of personal finance comparison website finder.com, who has recently seen the brand expand from an Australian success story to a multi-national operation.
Why did you want to take finder global?
finder had been operating successfully in Australia for over a decade. A few years ago we (my business partner Frank Restuccia and I) took a step back and could see that we were approaching the ‘end of the runway’ point. As far as Australia was concerned, we were reaching limit of things to compare, and our core strategy has always been to compare more things.
Going global and widening our playing field was going to enable us to reach a greater volume of people, with more comparisons and at a greater ROI.
How do you know if your business is ready?
If you don’t have your core systems, processes and succession plan firmly bedded down; you’re not ready. Expanding takes a great deal of time and energy, so ultimately you want to be sure the flagship can continue to operate successfully without your full attention.
I found a good litmus test to be - can you afford to skip the executive meeting? I didn’t slowly introduce my absence. I just stopped going. Our foundations team, and the systems they had in place quickly proved successful on their own which demonstrated I could step away and start to grow the business elsewhere.
You also need to be financially ready. Expanding will cost way more than you expect it to (just ask Amazon) and your business needs to be in a position with good cash flow to support further growth.
How do you choose where to expand?
There are some major factors business owners need to check off when considering potential countries for expansion. For starters, will the business model work in this nation? Determining the answer to this comes through thoroughly investigating the market landscape; how competitive is it? Is there any demand? What legal and political factors could be a barrier?
For example, while we have recently made inroads into Asia by launching in both Singapore and Hong Kong, China is further down the track due to political instability and lack of Google which is finder’s fundamental go-to market channel.
These factors are just the tip of the decision-making iceberg, however properly understanding these will be a strong determining factor of if, how and when you should launch in another country.
What have been some of the biggest challenges in finder’s growth?
Any business that is planning to expand globally should be prepared to make some big mistakes. You are basically building your company all over again, but a completely different playing field means a different set of rules. Sometimes the only way to learn the new rules, is failing fast and we did plenty of that with finder. We’ve had issues with legal implications, tax laws, compliance and simple things such as finding a place to set up shop.
We pride ourselves on being experts in personal finance, yet even we have made money mistakes when setting up global offices. For example, when we launched in the USA, we utilized freelancers around the globe to help get things up and off the ground. However, when payment time came around, we were hit with hefty currency exchange rates and lost a lot of money to wire transfers. We thought these were the most convenient as we had used these before, but in hindsight, we should’ve taken some time to research and switch to a better provider.
You will also likely make errors in recruitment. Operating from scratch means going back to basics as a start up so the early people you bring on that journey will need to be super understanding. We had product developers hunting for office space and communications experts ordering coffee and tea supplies. Everyone has to chip in to get everything you need done and those that adapt to this you will find are more likely to become your core crew.
What are your three golden rules for global expansion success?
Training and blueprints will be the cornerstones of your success
Apply these to the right people who will fuel your growth
Get on ground. You can’t build business in a new market from afar. Just get on a plane and go.
Fred Schebesta is the CEO and co-founder of global financial comparison site, finder.com. He spends his time growing his company, touring the startup speaker circuit, and acting as a mentor.