Australia has been responsible for a great number of technology innovations and successes and the ASX is home to some of the most successful technology companies in the world. Acconex, Wisetech, Appen, Webjet and AfterPay are all highly successful Australian exports.
Furthermore, Australian mobile apps have been recognised as some of the world’s best. In Apple’s list of 2018’s best apps, Australian developers were responsible for three out of the eight apps chosen.
So, what makes Australian technology so successful? Australian technology is developed with a user experience at the forefront, and the domestic market is the perfect place to test and prove the technology. In some ways the Australian market acts as somewhat of a test market.
It is then only logical that a company heads overseas for further growth, and in some cases their growth will begin overseas as the market opportunity in Australia doesn’t lend itself to rapid initial growth. Whilst Australia is by no means a small market, it is dwarfed by markets in Asia and the United States.
ASX-listed LiveTiles (ASX:LVT) is one company that has taken its software-as-a-service (SaaS) technology global. LiveTiles Co-founder and CEO, Karl Redenbach, is based in the US and the company now boasts nearly 600 customers – with the majority in the US also.
Mr Redenbach says that if you want to be a global technology company, you need to act global from day one. “When we launched LiveTiles we made a decision to launch in five countries on our first day. Traditionally companies start in one location and expand when they feel ready. We knew that if we wanted to grow and make an impact, we had to be in the United States to begin with,” he said.
Healthtech company MedAdvisor (ASX:MDR) is another ASX-listed SaaS company that has recently made the jump to expand overseas. It has partnered with Asian healthcare giant, Zuellig to enter the Asian market, and with a leading US health-tech company to enter the US.
In MedAdvisor’s case, it has established a strong position in its domestic market of Australia, boasting more than 55 percent of Australia pharmacies using its software and more than one million patients.
MedAdvisor has opted to enter new markets in partnership with local companies who can bring local expertise and knowledge of the market.
MedAdvisor CEO Robert Read said: “Whilst many markets can appear similar, it is the nuances that can catch people out, and with our partners and teams, we have the local knowledge and expertise which is critical to a successful market entry.”
One of the other benefits of taking a business internationally is access to a wider pool of talent that can not only help with entry into new markets but can also lead to product improvement and innovation.
ASX-listed BrainChip (ASX:BRN) has most of its operations based in the US. BrainChip is developing an artificial intelligence neuromorphic system on a chip (NSoC). The nature of its business means that San Francisco, also known as the global centre for technology, is the best location for the business’s staff, 80 percent of who are in research and development.
More importantly, for ASX investors, you don’t have to leave the ASX to gain exposure to small-cap technology businesses with access to high growth markets in Asia and the US.
Star Investing has a commercial partnership with some companies mentioned in this article. This content does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
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