Women Tech CEOs and Founders, Let’s Ban Together for a Global Market Reach
In March, Startup Genome, in partnership with Crunchbase, Orb and GEN, released the 2017 Global Startup Ecosystem Report (GSER). This report is a compilation and analysis of survey data and secondary research from startups in 55 cities with around 10,000 startup leaders participating. Its purpose is to inform tech founders, investors, city governments and other startup stakeholders around the world.
“[The GSER] is a leap forward in our understanding of startup ecosystems and the global network of capital and connections that drive them.” – John Ortmans, President of GEN
An Alarming, But Actionable Finding
Global Startup Growth Index
First off, I would encourage you (if you haven’t already) to study the report for yourself. It’s linked above, and a synopsis is here . I realize, though, the reality of time. So I am cutting to the chase and addressing one of the most alarming, yet actionable findings .
Being the CEO of a Chicago-based company, I couldn’t help but notice Chicago’s ranking. The windy city ranked 18t h for its global startup ecosystem. This is an 11-point drop from the 2015 report. The largest fall of any city in the top 20!
And, Chicago wasn’t the only American city to tumble down in the rankings. Los Angeles dropped to 9th, losing 6 spots from its 2015 standing.
Why did Chicago and Los Angeles rank significantly lower in this year’s GSER?
The answer…market reach.
Results for the GSER is derived from 5 categories of data on a city’s startup ecosystem—Performance, Funding, Market Reach, Talent and Startup Experience. Chicago’s rank for Market Reach was 20, while it averaged a 13.5 ranking for the other 4 categories.
Gauthiers, Penzel and Marmer, authors of the GSER, defined Market Reach as “how well [a city’s] startups ‘go global’ and how well the ecosystem helps in doing so.”
With a mere 8% of Chicago-based startups reporting to have customers outside of North America, Chicago’s lackluster showing in the Market Reach category is understandable. Only 12% of the Los Angeles startups report having customers beyond North America, making its drop in the overall rankings of the 2017 GSER no surprise either.
Why Women Tech CEOs and Founders Should Care You know the old saying, “If you know better, then do better.” It applies here.
In a 2015 report by Startup Genome on the ecosystem of Waterloo, Canada (and its results mentioned in the 2017 GSER), researchers “established that startups that focused on foreign customers grow 2.1 times faster than others.” They noted that startups in large cities in North America fail to grow at that rate, even when many Fortune 1000 companies are located in those cities.
Gauthiers, Penzel and Marmer highlighted other reasons to strive for a global market reach, or global connectedness.
- Working with foreign customers gives startups opportunities to detect problems and solutions affecting other parts of the world. This expands a company’s influence and product possibilities.
- Experiences with foreign markets position a company to be a “frontier” firm—a catalyst for growth and innovation.
Ladies, if we know growth and influence can come at a faster rate through global market reach, shouldn’t we do better? Shouldn’t we act on this?
Tech companies can leverage resources like Papayaglobal.com , a global platform that removes many of the obstacles we face with global expansion. Some of these issues include tax implications in foreign countries and finding right partners/mentors/co-founders with knowledge of foreign culture, etc.
Forming an advisory board may be helpful as well. This group of 3-6 people shares expertise with you for an agreed-upon compensation. Evidence suggests that startups with founders who actively seek advice from a trusted group of mentors and advisors have a higher success rate.
The key in terms of globalizing is to partner with those in other countries with knowhow…with knowledge valuable to your company. Leveraging a global tech ecosystem can make these key partnerships form quicker.
And that’s where Women in Growth Stages Tech comes in.
Women in Growth Stage Tech wants to help female tech founders and CEOs create a greater global market reach through a network of other leaders who are willing to learn from and teach one another. We want you to be ahead of the pack—to be aware of the latest findings and then to act on them.
The Bottom Line…
In the 2015 GSER, Chicago ranked number 1 in the world (yes, top of the list!) for the percentage of female founders . 30% to be exact. And in 2017, Chicago was number 1 again with 34% of the startups reporting to have female founders.
As women tech CEOs and founders in the windy city, we must capitalize on this strength to address a weakness in global market reach.
Savvy runners and cyclists (and aggressive drivers…you know who you are) realize that others take a mental and physical break as they top a hill. The savvy ones (and aggressive ones) don’t; they know this is the place to make a move and gain an advantage.
The bottom line…if we know that having a global market reach is one of the fastest ways to grow customers and Chicago startups are lagging in this area, then female tech founders and CEOs would gain an advantage from connecting to these global hubs as a team versus individually.
Join us. We would love to have you on “our team.” And, check out our upcoming events.