While it may seem daunting at first, entering the US market affords many opportunities to Irish businesses that don’t exist elsewhere. Aside from speaking the same language, and comparable legal and education systems making it easier for Irish companies to move, there are also the strong cultural bonds, and a long history between the two countries. Most importantly in 2017, however, is that Irish innovation and entrepreneurial flair has never been stronger – so being able to compete at the highest level isn’t an issue.
"There's definitely a higher level of sophistication among Irish start-ups now and those that came to the US in the past," says Sean Davis, Enterprise Ireland regional director for North America. "The single most important factor now is connectivity. Companies can access markets in San Francisco, New York, Philadelphia etc, rapidly. "It's probably one of the most straightforward places in the world to set up a business."
Many find it easier to attract new business in the US on account of a culture allowing for new entrants to succeed quickly, assuming the right product is on offer. "If you can demonstrate both capability but also show that your project is supported, opportunities present themselves more rapidly than in Europe, " says Dermot O'Shea, joint chief executive at Taoglas Antenna Solutions.
“Companies in the US are more open to partnerships, sharing their vision and strategy,” he adds. “In my experience, European companies are slower to reveal their own end game. Americans understand how transparency speeds up innovation if new partners – with their own strengths – are included in the overall vision.”
A culture characterised by rapid change means businesses come and go quickly. Access to credit and investment is considered easier, with opportunities not far behind. “People don’t wait around here so when opportunities arise, decisions are made quickly, which is why economic growth is so intense here,” says O’Shea.
Obviously the US economy isn’t immune to global volatility but businesses have become used to being agile and, therefore, know how to develop and grow with the market. “Dramatically changing strategy or even one’s value proposition is considered normal here,” says O’Shea.
Strong US dollar
A strong US dollar makes Irish exports massively competitive at present, a key factor Irish companies should be able to leverage against the American buyer. Then it becomes about price. “Irish companies will never be as cost-competitive, not only from the product’s perspective, but also in terms of accessibility,” says Davis. “Hotels and flights are cheaper in the US.”
"The dollar is currently strong and, as an Irish-based entity, we hedge against any fluctuations," says David Walsh of Netwatch, an Irish security company which launched in Boston in 2012 and already has customers in 28 states. This year, 75 per cent of its new revenue will come from the US alone, with plans in place to treble that within the next two years.
“Any serious Irish company will have a similar hedging policy. However, we happen to enjoy the added luxury of hedging naturally as the hardware we install is sourced locally in the US. The US economy is on the up and company directors are investing in their growth strategies and Netwatch is aligned to those actions.”
Irish companies coming to the US shouldn’t assume they can simply apply a business model that worked at home in the American market. It’s far too big and diverse to generalise. While there are always exceptions, the narrower the focus, the greater the opportunity in business. “We have a very clear focus on industry sectors that are growing rapidly themselves and where our value proposition can make a significant difference,” says Walsh. “That’s crucial.
“Our main industry targets are the automotive industry, utilities, logistics and transport and indeed with the legalisation of cannabis in many states, there is a growing need for stringent security to accompany this burgeoning market. We employ industry experts in those verticals and we are seen as the thought leaders in that space.”
Ireland also remains strong in the life sciences, with more than 250 indigenous companies operating in the US. "Seventeen per cent of US GDP is spent on healthcare," says Davis. "It's a massive market." Digital technologies and ICT are also expanding rapidly, particularly in the ecosystem surrounding Silicon Valley, while financial services are huge in New York, which has become the global hub for fintech innovation.
The UK remains Ireland’s largest market. But Brexit is likely to dramatically shake up the status quo for Irish enterprise abroad. The US is already our second largest export market and last year that market saw 20 per cent growth on the previous year. “We’re strongly advising Irish companies to look both at their UK exposure while simultaneously exploring opportunities in other markets,” says Davis.
The shared history between Ireland and the US helps establish bonds more easily between people and that’s a major component of how business is conducted in the US.
“Irish CEOs worked out a long time ago that, at the macro level, there’s significant cultural alignment between Ireland and the USA,” explains David Walsh of Netwatch. “Being Irish is a great starting point in the US and opens many doors. However, one still needs a solid value proposition to close deals and capitalise on this vast market. For Irish companies with a strategic positioning based on high-quality service, the USA offers limitless opportunities.”
Dermot O’Shea, however, doesn’t necessarily agree that Ireland’s history of doing business in the US is all that relevant in the technology sector. “What matters in this space for Irish entrepreneurs is the ability to look to the future,” he says. “That’s what makes it a natural choice. Irish companies are certainly at no disadvantage. They have a head start simply from an initial conversation starter. After that, it’s quickly down to who you are, what you are selling and how it helps them. They need to know what’s in it for them right away. You need to be saving them money or making their solution better, or ideally both.”
Over and over, Irish companies who succeed in the US stress how crucial it is to set up a permanent base there rather than trying to conduct operations remotely. Both from a practical perspective and sheer optics, it makes sense to relocate. “If people are serious about the US they need to set up a US office and show that commitment,” says O’Shea. “The high level of customer service expectation means immediate responses and solutions are expected and proving oneself is far easier once it is known you have a physical presence in the US.”