Interpreneur Report 2024
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- Interpreneur Report 2024
Published on Monday, June 10, 2024
It’s two years since Kreston Global published the inaugural “Interpreneur” report investigating what drives entrepreneurs to take their businesses international and what it means to be an interpreneur, and in that time the landscape in which business operate has shifted significantly. Growth remains slow across much of the global economy, while spiralling inflation has increased the cost of doing business. Geopolitical tensions have disrupted supply chains, and the outcomes of the many elections planned this year are hotly anticipated.
At the same time, the operational priorities for business leaders are in a state of flux. The global taxation regime is seeing far-reaching changes, generative AI looks set to transform the way businesses operate, and access to capital remains a key consideration, buoyed by private equity investment as IPO activity slowed in many markets. Meanwhile, the nature of globalisation is altering as the flow of trade in services and data grows alongside that of goods, now that digitalisation has become a constant feature of business life.
In light of this, this second edition of the report focusses on the realities of going global. We investigate what it means to find success as an interpreneur, where the biggest barriers and bridges to expansion abroad lie, and what strategies and tools leaders of small and medium sized businesses (SMEs) are using to navigate the market forces and commercial pressures of international entrepreneurship today.
We surveyed 1,400 SME leaders to find out what’s driving interpreneurs to go global, what they have learnt from their experiences accessing new markets and audiences and how that insight can inform the roadmap for future. And we probe specific themes shaping the boardroom agenda, including ESG, AI, funding, tax and regulation to understand how these issues play into thinking around international expansion.
Though business confidence at large has taken a hit, with the OECD’s Business Confidence Index falling below 100 (indicating a degree of pessimism about future performance), our findings suggest that interpreneurial spirit remains strong.
Armed with this intelligence, our aim is to inspire and equip interpreneurs to thrive in any circumstances and to add to the bank of knowledge and expertise that we can offer entrepreneurial businesses and individuals expanding into new regions. As champions of interpreneurialism, we firmly believe that with the right advice and support, every perceived barrier can be overcome, and every opportunity can be maximised.
"In periods of volatility or challenging headwinds, SMEs have the benefit of agility to turn challenges into opportunities and seek out new ways in which to make their business successful, both at home and abroad.
Taking the leap to go global requires grit and confidence in equal parts. Those that make the transition must balance careful preparation and well-informed decision- making with the willingness to be bold and the foresight to keep an eye firmly fixed on the future.
When you’re branching out into new areas, having access to specialist local knowledge and on-point expertise on the ground should enable you to get set up quickly so that you can start to maximise returns sooner and drive performance on a global scale. That insight could mean the difference between failure and success."
Liza Robbins, Chief Executive
Executive summary: The realities of going global
Key findings from report reveal:
Interpreneurs are gearing up for growth and looking for competitive edge
More than half (52%) of survey respondents said their businesses’ primary motivation for expanding internationally was to secure market growth opportunities, followed by a desire to gain a competitive advantage by gaining a foothold in new regions before rivals.
Interpreneurship has delivered a real boost to businesses
Almost all respondents (96%) believe going global has been benefitted their business. Increased sales and revenue and greater profitability were cited as the two biggest benefits they have seen following international expansion (by 53% and 46% respectively).
Interpreneurial drive remains strong
Perhaps due partly to this success, 87% of respondents said they expect an increase in the number of businesses expanding overseas in the next 12 months. The most popular prospective destinations respondents said their business would consider expanding into are Western Europe (52%) and North America (48%).
Supply chain issues and economic risks pose critical challenges
Just as interpreneurs are clear sighted about the opportunities, they’re highly conscious of the challenges and risks too. Adapting logistics processes and dealing with supply chain issues was the biggest hurdle (for 41%) when undertaking an international move, followed by finding the right local partners (39%). A similar proportion (38%) felt that an economic slowdown or recession poses a disruptive or significant risk as they look ahead.
Private investment is seen as a key source of capital to support global growth
Almost half (47%) of respondents said that their business is likely to consider using or has used capital from private investors (including high net worth individuals) to grow internationally, and 43% reported using or considering venture capital or private equity investment.
Interpreneurial businesses are taking their ESG responsibilities seriously
Environmental, Social and Governance (ESG) issues are front of mind as businesses look to increase their global footprint. The majority (93%) said they do or would consider ESG practices to some extent when considering which countries or regions to expand into.
AI looks set to take an increasingly prominent role in business operations
As the prevalence of artificial intelligence (AI) grows, nine in ten respondents (90%) said they feel prepared to harness the benefits of AI in their global business operations in the next two years. Only 3% of respondents said they felt unprepared.
Interpreneurs are confident on tax – but must stay abreast of complex and sweeping changes
Four in ten respondents (40%) said they are extremely confident that they have a deep understanding of the global international tax rules that govern multinational businesses – and a further 53% say they are confident they understand these rules. Though this is encouraging, there are significant tax changes coming into force in the next few years, on which they will need to keep a close eye in order to remain compliant across different jurisdictions.
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At Kreston Global, our global network of business and tax advisers have a deep understanding of the landscape in more than 114 countries around the world. We work closely with SME leaders to plan and execute successful interpreneurship strategies, ensuring that businesses are primed for success as they go global, and supporting them at each step of the way as they develop and grow their operations abroad.
