Business Sweden Insight: Going global,
the smart way
For Swedish Fin-Tech start-up and scale-ups, expanding beyond the Swedish market is the natural next step in realising business growth ambitions. But what are the challenges and solutions to successful European and global expansion?
Business Sweden’s resident FinTech expert, Peter Svensson shares knowledge that has helped Swedish companies make the successful transition from local market growth to global sales.
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Knowledge is power!
The diversity of the FinTech sector is a strength but also means there is no one-size-fits-all for global expansion. Regulations that might apply to lending may be different for payments, wealth management or personal finance. For some, approval from a regulatory body is the key to operating in a new market, while employment law or compliance is critical for others. Even across Europe, where regulations are meant to be harmonised, differences exist. While directives such as PSD2 and MiFID2 provide overall regulation for the entire EU, not all FinTech work with payments or securities.
Rushing into a new market without doing your homework increases the risk of failure. If you launch in a market, set up a company, employ your first local staff and then realise you don’t have funding to keep operations going until revenue starts to come in, you can lose time, energy, money and jeopardise your reputation.
Being prepared is not just about legal compliance and a quicker entry to market, it can define long-term financial and reputation security.
Localisation is key
Awareness of cultural nuances goes beyond language. Understanding local purchasing patterns, payments, verification methods or consumer behaviours in advance can determine if a market is not only suitable, but if changes are required to your offering. For many Swedish FinTech companies, the provision and mass acceptance of digital signatures is taken for granted. In new markets, they often don’t have similar technology for identity verification and digital signatures so product adaption or offering might be necessary.
Local preferences can also determine how a product is perceived in a new market. Are the customers used to interacting online or do they usually rely on face-to-face interactions? Are paper based applications still the norm? Is trust in incumbents high and how do users interact with them? Our market insights can shed light on these cultural questions which can inform the decision-making process.
Having a local language website is imperative but not the only cultural angle that needs to be considered, customer behaviours need to be broadly understood to gain meaningful traction.
Build trust and reputation
A solid reputation and loyal customer base in Sweden don’t always translate to a new market. FinTech companies are particularly vulnerable to local favouritism with B2C brands and services. Consumers can be conservative and risk adverse with personal finances, even if the Swedish solution is superior or could potentially save them money. Partnering with local incumbents and securing local backing can build trust and help to create a customer base.
The same struggles can happen when trying to open doors with B2B connections. Banks, investors and potential partners aren’t always receptive to companies they don’t know or trust. Our expertise and local networks are often the key that unlocks business relationships that can rapidly create trust and build reputation in new markets.
On the ground connections and tapping into our existing network has helped many FinTech companies successfully launch and expand in new markets.
Get expert help
Start-ups and scale-ups don’t have to go it alone. It can be challenging enough starting out in your home country, understanding regulations and building a solid client base. In a new market, the challenges are greater and often more complex. Our Leap and Catalyst programmes have paved the way for companies including Minna, Kaching, Scrive and Payground to work with global sales experts to research, plan and launch international expansion.
While big FinTech players such as Klarna and iZettle continue to raise the bar, emerging companies can benefit from the lessons learnt and the continued market growth and evolution.
There is an appetite and place for Swedish FinTech in the global market. We know that our culture is a great test-bed for all types of solutions and proven market success in Sweden and the Nordics is the perfect launch pad for global expansion.
Want to start or accelerate your expansion plans?
Need help taking the first step of your journey, or a little bit of a boost along the way?
We are here to set you on the right track for successful expansion in international markets.
Team Leader Customer Group ICT
Hanna Leffler
Project Manager
Copenhagen
hanna.leffler@business-sweden.se
+45 20 563 110
Business Sweden’s purpose is to help Swedish companies grow global sales and international companies invest and expand in Sweden.
