Nina Jones and Matt Smith have been raising capital for their start-up, Net-Work Docs. The company will help business clients create and manage their documents electronically. Net-Work Docs will help companies create easily searchable electronic versions of their safety manuals, human resource manuals, training guides, operating instructions, and more. For clients who wish, the company will help in embedding video, audio, and pop-up content along with the basic text and will develop apps for companies that want to make the content available through mobile devices. They also will provide consulting services such as helping clients shop for cloud storage of their documents.
As Nina and Matt developed their business plan, they found themselves expanding their idea of the geographic market they could serve. Initially, they intended to start by working with businesses in their city. But they realized they will be selling a product that can be made anywhere and shipped anywhere. Software and electronic documents can be transported over the Internet at essentially no cost, and a website gives a company an immediate global presence. With that in mind, Nina and Matt have concluded that they are unnecessarily limiting themselves by targeting geographic markets.
Thus, the plan is now to launch Net-Work Docs as a global company, serving clients in any country. After all, reason Nina and Matt, companies everywhere have policies and procedures they need to document. They will describe their services on their website, make initial contacts via e-mail, and set up a PayPal service to handle online payments. They can travel to meet major clients, but routine jobs may not require face-to-face meetings, and cost-conscious clients should appreciate the savings of conducting business online.
One hitch with this plan is that some potential investors have expressed doubts about operating globally before the company has built experience and a reputation serving clients locally. One investor asked Matt and Nina whether they really were prepared to understand the needs of business clients located hundreds or thousands of miles away—and whether they could assess a faraway client’s likelihood to pay for services. He asked, “Can you really serve overseas clients without any overseas employees?” The company’s founders believe they can because they will start with an English-only website, so they will initially have only English-speaking clients.
1.What are some possible advantages of Net-Work Docs serving a global market?
2.How are the founders balancing pressures for global integration and local responsiveness? Is their global strategy likely to succeed? Why or why not?
3.What skills of a global manager could help Net-Work Docs succeed?