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Born Global Micro-Multinational Firms: A Silicon Valley y Perspective p Carlos S. Baradello, PhD Associate Dean School of Management University of San Francisco


Conversation Themes  Personal Reflection  Is Entrepreneurship a Solution for Emerging Economies?  Born Global  Bi/Multi Bi/Multi-National National Entrepreneurship  Closing Reflection


+3B 44 Years +3B 40 Years

Source: U.S. Census Bureau, International Data Base, June 2010 Update.

Data powered by


World Population = 7B -Under 24 years of age = 3B, 88% li living i iin less l developed d l d countries


40% of the World World’s s Population is YOUNG AND POOR!


America’s Population: 1950 ‐ 2050 Years Total

Median age

24 Years old and under and under

2010

344,124,450

37.2

2015

360,773,212

37.7

2020

377,908,737

38.2

2025

395,145,456

38.7

2030

412,202,904

39 2 39.2

2035

429,059,601

39.5

2040

445,855,419 , ,

39.5

2045

462,820,243

39.5

2050

480,268,647

39.5

115,829,462 33.7% 118,808,309 33% 122,247,518 32.2% 127,334,218 32.2% 131,988,995 32.0% 136,679,953 31.9% 141,393,205 31 6% 31.6% 146,372,684 31.5% 151,719,487 31.6%

Latin America Total

Americas  Median 24 Years old Total age

and under and under

591,468,575

27.5

625,182,355

29.1

656,971,781

30.8

686,231,794

32.4

712,366,834

34 0 34.0

734,893,239

35.6

753,537,129 , ,

37.1

768,179,314

38.5

778,808,708

39.7

270,893,906 45.8% 270,330,801 43.2% 268,381,722 40.8% 264,966,100 38.6% 260,941,618 36.6% 256,475,862 34.8% 251,659,471 33 4% 33.4% 246,459,346 32% 240,959,993 30.9%

935,593,025 985,955,567 1,034,880,518 1,081,377,250 1,124,569,738

1B B Ma arket

North America

1,163,952,840 1,199,392,548 , , , 1,230,999,557 1,259,077,355

70%younger of the 24than andNA under liveData in powered by LA 10 years Latin America

Source: U.S. Census Bureau, September 2010


Colombia’s Population: 1950 ‐ 2050 Latin America Years Total

Median age

24 Years old and under and under

2010

591,468,575

27.5

2015

625,182,355

29.1

2020

656,971,781

30.8

2025

686,231,794

32.4

2030

712,366,834

34.0

2035

734,893,239

35.6

2040

753,537,129

37.1

2045

768,179,314

38.5

2050

778 808 708 778,808,708

39 7 39.7

270,893,906 45.8% 270,330,801 43.2% 268,381,722 40.8% 264,966,100 38.6% 260,941,618 36.6% 256,475,862 34.8% 251 659 471 251,659,471 33.4% 246,459,346 32% 240,959,993 30.9%

Colombia Total

Americas  Median 24 Years old Total age

and under and under

44,205,293

27.6

46,736,728

29.3

49,084,841

31.2

51,194,904

33.2

52,964,681

35.1

54,344,063

37.0

55,334,967

38.7

55,955,930

40.3

56 227 630 56,227,630

41 6 41.6

20,244,204 46% 19,977,664 43% 19,458,838 40% 18,952,220 37% 18,492,833 35% 17,969,800 33% 17 387 131 17,387,131 31.5% 16,748,485 30% 16,082,024 29%

935,593,025 985,955,567 1,034,880,518 1,081,377,250 1,124,569,738 1,163,952,840 1,199,392,548 1,230,999,557 1 259 077 355 1,259,077,355

Colombia aging a bit faster than Source: U.S. Census Bureau, September 2010 Data powered by Latin America


Yet their consumption aspirations are greater than h ever!!


Unstable Unsustainable Unequal Yet... Interdependent Interconnected


Knowledge Based Innovation Innovation + Entrepreneurship = $VALUE$

“Every Every great advance in science has issued  great advance in science has issued from a new audacity of imagination.” J h D John Dewey


Knowledge Based Economy Innovation + Entrepreneurship = $VALUE$

Technological Innovation +  Entrepreneurship + Gl b l M k t Global Markets + Speed =  has issued “Every Every great advance in science has issued  great advance in science from a new audacity of imagination.” $$Extraordinary Wealth$$ J h D John Dewey


Innovation Enables the creation of  “TEMPORARY TEMPORARY MONOPOLIES MONOPOLIES”


$Revenues & $Remittances$ Capital Gains$ Intellectual Capital/ Mi Migrants t Services


New Ventures – Key Elements Management Advantage    

"Secret S "S Sauce"" Value proposition Positioning Timing

Market  Beachhead  Segmentation  Growth

Global Scaling

Resources  $$$  Human capital  Intellectual property


"Born Born Global Global" firms... ... seek their competitive advantage by leveraging resources, markets, suppliers, and human capital from many countries ... operate globally from day one ... demonstrably commit resources beyond domestic borders ... are also called “Micro-Multinationals� 16


Traditional Global Expansion


Current Global Response


Two Venture Creation Models (1) Born (2) Born in the Global garage


Born Global Enablers  Information Technology  Global Human Mobility  Lower Global Barriers & Transaction Costs  Homogenization/Standardization of Global Markets us to Reach eac New e Emerging eg g  Rush Markets


New Challenges g

 “Distance” Distance  Speaking the “language”  National/Regional N ti l/R i l context t t  Managing extra complexity

Source: The Global Entrepreneur, D.J. Isenberg, Harvard Business Review (December 2008)


Reading the “Signs‐of‐the‐Time” of LA Students  do not view  education as a sequential  process

Younger generation  become globally  connected as “peers” connected as  peers

Few  local role  models emerging,  case studies … “can‐ case studies …  can be‐done” attitude

Most institutions, including  education are non education are non‐ performing even by 19xx  standards

Younger generations have  lost faith and patient with  government promises government  promises

“some” support  mechanisms become  available il bl

360°/street smart  / skills of great value to  entrepreneurs

Younger generations high  consumption aspirations consumption aspirations  enroll them into the market  economy


Changing Paradigms…

…new Forms Emerge

• Increased risk in LA, • Entrepreneurship  defines you as a defines you as a  person • Renewal & NEW  opportunities

Ack’t of RISK/

Bottom‐up  AMBIGUITY Empowered

• New relationship with the  dominant powers:  USA/  Europe • New entrants: China, India,  Brazil, Russia, Turkey, etc. • Everyone a “connected  peer”

Global Networks Emerge

Everyone  can play  w/everyone / Everywhere 7x24!

• “Slices of genius” connected  across  different  organizations/continents, • Social media turning  coincidences into revolutions  on markets and societies • High state of alert of  consumer/user tastes. consumer/user tastes.

• Corporations, individuals,  government, etc… everyone  wants to play, • Corporations open up! • Countries compete like  Countries compete like corporations • Creation of : social/economic  value is KING!


Old Challenges are Exacerbated  Speed  Seeing g unseen opportunities pp  Value proposition  Playing N+ moves ahead on the “chessboard”


Globalize your Business    

One Minute Elevator Pitch 5 Minute Business Presentation One Hour Business Meeting One Hour Business Meeting Business Collateral: • O One pagers, posters, portable demo kit,  t t bl d kit brochures, business cards, etc.

 Business Negotiations B i N i i  Transaction Closure


Call to Action  Attack global markets:  Domestic markets last or never, foreign partners, JVs

     

Unique product development process Global technology competence High bandwidth communication (web 2.0) g ( ) Deploy resources where they make most sense Build momentum Build momentum Get team on board:   Upgrade management, journey vs. stop and go Upgrade management jo rne s stop and go


Profitably Scaling-up & Accelerating Growth of Bi-National Bi National Ventures USA Chile, Mexico Peru, etc.

Risk Capital

Risk Capital

Science, IT  &  Innovation

Bi‐ National  Ventures

HR

Knowledge &  Ph i l Physical  Infrastructure

Formation, Incubation & Pre-Acceleration

Value Chains Market Access Access to Capital

Science, IT  &  Innovation

Bi‐ National  Ventures

HR

Knowledge &  Physical  Physical Infrastructure

Acceleration, Post Acceleration Post-Acceleration & Global Expansion


No new business is worth starting in these times unless it can go global. — Richard Branson, Virgin Empire


Innovation -- Entrepreneurship -- Productivity

PROSPER REAL PROSPERITY

MAXIMIZATION OF THE PRODUCTION EFFICIENCY

MAXIMIZATION OF VALUE CREATION BY COMPITING PRODUCTIVITY IN GLOBAL MARKETS

COMPETE NATURAL

COMPETENCE

INHERITED

CREATED

INNOVATE INNOVATION

29


Thank you! Carlos S. Baradello, PhD Associate Dean Corporate p & International Programs g School of Management University of San Francisco Tel. +1 (415) 342-6663 E mail: csbaradello@usfca E-mail: csbaradello@usfca.edu edu


Presentación Carlos Baradello TagMe 2011