Obstacles to global entrepreneurship
Estimating the costs
I advise idea-stage founders and pre-product companies on taking their first steps in establishing a solid footing outside their local market. However, one of the biggest costs (mentally and financially) for them continues to be immigration. Through back of the envelope calculations, we estimated that these financial costs are:
Direct costs: $800-$1,500 annualized for the first 10 years
Indirect costs: $20,000-$30,000 annualized for the first 10 years
After the first 10 years, these costs do start to go down but they never reach zero. The costs on businesses are much higher, for example we had to shutter two startups and lose more than $200,000 due to immigration matters!
However, entrepreneurs by nature are built to overcome these obstacles, just go and read some of their inspiring stories. I was recently listening to a podcast by Tahmina Watson, a startup immigration lawyer, whose guest had to wait 22 years before they could launch their own company. Better late than never!
A group of entrepreneurs I particularly enjoy working with come from Iran. Unfortunately, they are one of the groups hardest hit by immigration rules. An example was the Trump travel ban in 2016. It was tragic on so many levels and affected so many of them and their families.
In the book, The Great Convergence, Richard Baldwin builds a long-term model of globalization based on three waves resulting in reducing the cost of movement of goods, ideas and people.
It gives me hope to think that we are in the early innings of the third wave and are witnessing the growing pa
ins, including the recent tensions that I wrote about. The inevitable progress of technology is going to have a profound impact in this wave, as it did in the previous two. A look at Zoom, Hopin and Deel, companies that capitalized on these trends, provides early glimmer of hope and a blueprint for success.
I can feel the exciting impact of this third wave. More people are talking about it, more funding is becoming available and it’s time founders step up and build for the third wave.
This is a post about ecosystem resources which was also posted on LinkedIn to benefit global entrepreneurs. If you’re thinking about becoming global or have global aspirations, get in touch.