For small businesses, adapting to tough times often means expanding their horizons
Ricardo Tejada, Founder and Managing Director of Vnesto Capital, delivered the keynote address at the Expanding Horizons seminar in Orange County, CA, where he shared his story of adapting to the recession by expanding his business into South Korea and Ecuador. Vnesto Capital was founded in Los Angeles in 2005 to help small firms obtain capital and build successful business plans, but has since expanded into a full service investment bank.
Here, Tejada discusses why expanding overseas is the right strategy for many small businesses.
Did you always think of growing your business overseas, or was it a gradual evolution?
I think with any concept, you start at its core and say these are the small services and this is the immediate need that I see. And from there, it really just mushroomed into seeing that there were more opportunities and that the need was greater than I expected.
Vnesto is a services business, which is not what most people think of when they think of exports. What is the international opportunity for services businesses?
We are used to thinking of exports as things we can package and ship. But we can also package and export our expertise, whether it is marketing or advisory or financial. A lot of people believe that services are the future of exports. It requires a shift in thinking of what an export is.
What is the biggest challenge of expanding internationally?
Starting a business is always a difficult task. When you think about expanding overseas and understanding all of the licensing and tax and employee and marketplace issues associated with that, the challenge is almost doubled. You have to be prepared for a big learning curve
How essential is overseas expansion for small businesses?
Obviously if you are a liquor store at the corner of your local neighborhood, or some very small mom and pop operation, it is probably not going to serve a purpose. But for many businesses, expanding overseas can offer a huge advantage. It is necessary for all small businesses to start looking at the world as a smaller place. Many developing countries are not oversaturated and have more room for growth. If you are able to export your unique competitive advantage, it is almost a no-brainer.
How can companies benefit from working with OPIC?
When a business starts expanding overseas it has several concerns about security and having the capacity to make wise decisions, and finding the capital to fund the expansion. OPIC comes in and really fulfills those concerns. So, when it speaks to partners overseas they realize that they are not just dealing with a small business, but with a small business in partnership with the U.S. government.