FDI for the Little Guy

Foreign direct investment (FDI) promotion has traditionally been a game for the big boys with large multinational corporations as the primary business recruitment target and large cities, states/provinces, and countries as the prime recruiters.  A series of articles in the April/May 2014 issue of FDI magazine examines a growing trend where inward investment agencies are turning their attention to supporting and attracting small and medium-sized enterprises.

The issue includes a series of articles that offers a general update along with more background on efforts in Finland and the U.K. (Note:  Article access requires registration).  Small firms entering global markets have many unique needs.  Of course, capital access programs matter.  In fact, some industry experts find that these programs matter more in FDI than in domestic markets as available capital may persuade a firm to enter a previously neglected foreign market.   When combined with other consulting services, such as the programs now underway in Leipzig, Germany, these efforts can prove quite attractive to SMEs.  They help encourage managers to consider locating in cities and regions outside of the usual suspects.

These efforts also need to be much more customized and hands-on than traditional FDI programs.  In Finland, the Helsinki Business Hub team focuses heavily on contact facilitation, linking overseas entrepreneurs into the local ecosystem.    Lastly, successful initiatives provide hands-on guidance about local rules, regulations, and business customs, so that SMEs can achieve a  ”soft landing” in new markets.

 

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