77% of Spanish digital businesses sell internationally, but regulatory barriers restrict their global expansion

Report published by Stripe

Despite a desire for expansion, barriers in regulation and compliance are slowing the global growth of Spanish startups and businesses through the Internet.

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A report published by Stripe, payment and treasury platform, shows that the ecosystem of startups and Spanish companies through Internet It is in good health but is not growing at the rate it could, losing competitiveness and productivity that could come from greater Capabilities.

 

Spanish Internet companies They have a great interest in international growth but the study reveals that regulation is a great barrier that Spanish online companies they must overcome. It involves an enormous amount of time spent on both regulatory and compliance issues, which directly impacts business growth and global expansion.

 

Spanish online companies are becoming Global Natives

 

Globalization has been driven by large companies, but the Internet now allows virtually any business to reach customers anywhere. For today's online business founders, going international has become a priority. In fact, 70% of online businesses are selling outside their local market. This figure is even higher in Spain, where 77% of online companies sell abroad. They are global natives and clearly show the business paradigm shift when compared to the total number of companies that sell internationally in Spain, less than 2%. In most countries, the percentage of companies with foreign customers It is in single digits.

 

Analyzing where Online Business choose to sell internationally, there is no defined or clear pattern. In the case of Spain, for example, the countries of the UE are the main market with 45%, followed by North America with 12% and China and South America with 10% each of them. But, if we analyze a neighboring country like France, the patterns are radically different representing the countries of the UE only 29% of its market, the same percentage assigned to the Asian markets followed by North America with 16%.

 

"Internationally, the biggest challenge has been the cultural aspect: understanding how customers in each country think and adapting to that environment. Currently, we sell internationally in 13 countries, the most important being..." France and the United States. Fortunately, we have had the help of platforms like Stripe, which have made our journey much easier when it comes to serving our international clients. It must be taken into account that when you talk about international clients you are talking about foreign banks and Stripe It is a platform that allows you the fewest possible incidents with banks around the world. When we talk about thousands of transactions this becomes a fundamental factor,” he says. Cristina Rodríguez, founder of mumablue.

 

Technology facilitates the internationalization of companies

 

It is clear that there is an interest in international expantion among online businesses. Those who want to internationalize their businesses do so quickly, with 60% of online companies entering new markets within the first year of their existence. On the other hand, one of the most recognized multinationals on the planet, Coca-Cola, did not start selling outside United States up to 34 years after its founding.

 

In the case of Spain, if we look at one of the most international brands we have, Inditex/Zara, it took 25 years to open business outside our borders; while 60% of the Spanish companies Participants in the study have internationalized their sales in their first year of existence, 13% of them from the first day.

 

The Internet era has promoted international expantion, but what has really accelerated the globalization of online companies has been the new technologies applied to their businesses, facilitating their international takeoff. These technologies range from online payments to online advertising, including cloudcomputing, etc. More than ⅔ of the online businesses surveyed cited these tools as the main enabler of international expantion, above access to financing (37%), physical infrastructure (36%) or government support (35%).

 

 

 

Several factors have hindered the global expansion of Internet companies. Even though entrepreneurs and governments are aware of the benefits of being global, 42% of respondents say it is more difficult to do business internationally today than it was five years ago.

 

 

 

Sales through the Internet are the main way to access international sales for new companies, especially for smaller ones. New technological tools have definitely allowed global natives to access new markets much more quickly. They have also given rise to a new group of multinational companies that grow rapidly and without employees, these companies represent a new category of business: The sole proprietorship multinational.

 

Almost nine in 10 respondents from these sole proprietorship multinationals say that new digital tools have made it easier for them sell internationally. They are international simply because they can be, because their product attracts a global audience and, thanks to the power of marketplaces, nothing stands in their way. Half of them have even been international from day one.

 

Spaniards are entrepreneurs, but regulation restricts their growth

 

While governments around the world say that facilitating the creation of new businesses is one of their priorities, among the 15 countries participating in the study, less than half (44%) of respondents say that establishing a business in their country of origin is easy. This varies from country to country, with japanese entrepreneurs those who find it easier to start a business in their country (77%); At the other extreme we find the Spanish entrepreneurs with only 29% stating that it is easy to start a business in Spain, the second lowest figure just above Italy (19%).

 

 “It is no longer an option to make plans to expand internationally in one, two, five years. In the current panorama, with a strong appetite among Spanish companies to develop beyond our borders and with technological tools that facilitate expansion, globalization from day one is the way to follow. “We know that Spanish entrepreneurs have the ability to influence economic growth both locally and globally, and that is why we will continue to support the efforts of their businesses to scale internationally from day one,” he says. Borja Santos, head of Stripe for Iberia.

 

Barriers to international expansion are impacting business opportunities

 

There is a clear correlation between the speed at which a business goes international and its economic success and productivity. According to the study's global data, over the past five years, companies that expanded globally during the first year of their existence grew 141 percentage points in revenue and 15 percentage points faster in headcount than companies that expanded more slowly globally. international.

 

Several factors have hindered the global expansion of technology companies. Internet. Even though entrepreneurs and governments are aware of the benefits of being global, 42% of respondents say it is more difficult to do business internationally today than it was five years ago.

 

The main obstacles start from government policies; More than ⅓ of companies say taxes (38%), regulatory barriers (36%) and government fees (34%) have made global expansion difficult.

 

Time and money spent on regulatory and compliance issues are also a barrier to growth. Online businesses say they spend between 5,9% and 37,8% of their net profit on regulation and compliance each year. Additionally, 38% of respondents say they spend weeks of their own time managing these regulatory issues.

 

“Without a doubt, we need a more dynamic and flexible regulatory framework, homogeneous, stable, technologically neutral, clear and predictable. At the end of the day, the competitiveness is at stake not just of a company or an entrepreneur, but of the Spanish and European economy as a whole, and this is essential if we want to advance in the consolidation of the Digital Single Market for Europe can compete on a global scale with the great leaders, China and United States", José Luis Zimmermann, general director of Adigital.