Following a discussion the Global Innovation Forum held at LivingSocial, two of the entrepreneurs who participated authored an op-ed about their unexpected global journeys. The Washington, DC-based media outlet The Hill recently published an article by Kavita Shukla of Fenugreen and Pranav Vora of Hugh & Crye, two startup founders located in the Washington, DC-metro area.
The full text of the article follows —
September 09, 2014, 02:00 pm
By Kavita Shukla and Pranav Vora
Call us the accidental global startups.
Several years ago, we started building our respective businesses with an initial focus on the United States. Both of us had an idea and ran with it, without thinking much at first about the global marketplace.
But in a world where technology has dramatically lowered the barriers to communicating and innovating across borders, we soon began building global brands.
The two of us met recently at a discussion hosted by the Global Innovation Forum and LivingSocial, where we highlighted our small role in the global economy.
Hugh & Crye started developing manufacturing relationships with mills and factories around the world. The company also started investigating global standards, like the “Oeko-Tex” certification to guarantee that textiles are free from harmful chemicals, heavy metals, and other nasty substances, and partnering with international social compliance organizations like Arlington-based Worldwide Responsible Accredited Production, and Brussels-based Business Social Compliance Initiative.
Fenugreen began by selling handmade batches of FreshPaper, which keeps food fresher longer, at farmer’s markets in Cambridge, Mass. Simply through word of mouth, a grassroots movement spread FreshPaper nationally to retailers like Whole Foods, and then to farmers and families across the globe. As news outlets such as CNN and The Washington Post began mentioning FreshPaper’s potential to change the global food system, the small social enterprise scrambled to fulfill international orders and understand customs procedures for dozens of countries around the world.
Our global journeys are not unusual. These days, the Internet affords global visibility to even the smallest business, whether it is based in Washington, DC, Berlin or Bangalore. McKinsey reports that 90 percent of eBay’s commercial sellers around the world participate in global markets versus fewer than 25 percent of traditional small businesses.
The benefit of engaging in global markets is likely to increase further. The same McKinsey report highlights an 18-fold increase in cross-border Internet traffic between 2005 and 2012, with rapidly-growing developing countries engaging in a growing share of e-commerce. Mobile plays an increasingly important role, as handsets are ubiquitous and more prevalent than desktop or laptop computers. A study by Worldpay shows a six-fold increase in mobile purchases from $18B worldwide in 2012 to $117B in 2017.
While the global marketplace presents an unprecedented opportunity, there are many barriers and challenges for startups. Young companies often do not have the resources to navigate high tariffs, opaque customs rules, theft of intellectual property, blocking of online platforms or financial services, or to engage with lawmakers about these challenges. Trade barriers effectively reroute our businesses. Like most entrepreneurs, we carry on, but we believe there must be a better way.
Our ability to participate in the global marketplace relies fundamentally on an open global Internet and open trade policies.
Governments should consider that we and other startups like us in towns and cities across the country and around the world are engaging in global markets, and that efforts that undermine the global digital marketplace or physical trade lanes will also undermine our missions.
Fortunately, governments can also do more to help. Recently, the White House Business Forum held a design workshop focused on helping globally-minded startups and small businesses understand and access the resources available to them. One idea that came out of the design workshop was to develop a quick reference guide to resources across the levers of government that would be useful to startups, and to highlight that toolkit through social media and other online and in person platforms of interest to entrepreneurs.
One day, our companies may be large enough to knock down barriers globally. Until then, our businesses will follow the clearest paths.
Shukla is the founder and CEO of Fenugreen, a Maryland-based social enterprise taking on global food waste with FreshPaper, a simple innovation that naturally keeps produce fresh for longer. Vora is the founder and CEO of Hugh & Crye, a lifestyle brand that introduced a new-to-world sizing system for men’s apparel, based in Washington, DC.