EMCC European Monitoring Centre on Change

Go international!

Austria
Phase: Anticipation
Típus:
  • Access to finance
  • Support for digitalisation
  • Advice
  • Start-up support
  • Support of companies' growth
  • Support of internationalisation
  • Support of SMEs
  • Training
Utoljára módosítva: 03 August, 2021
Név:

Go international!

Angol név:

Go international!

Coverage/Eligibility

Coverage extends to all enterprises that intend to establish export relationships for the first time, or to open up new markets abroad. There is a particular focus on small and medium-sized enterprises (SMEs).

Main characteristics

Support programmes are structured around the instrument's five clusters

  • Cluster 1: How to do business abroad (motivation of SMEs to start exporting);
  • Cluster 2: Enhancing strengths (to support enterprises to establish themselves in their respective niche in new markets, focus on industry);
  • Cluster 3: Exporting know-how (export support for the services sector);
  • Cluster 4: From exporting to integrated value-chains (FDI in growth markets);
  • Cluster 5: Communicating Austria (promoting a modern image of Austria abroad).

Support is provided in relation to: market access and market development; developing intelligent strategies in respect to international business entry; human resources and know-how; and improving framework conditions. It also involves the provision of information, consultancy, training, guided trips to promising markets, aid in networking and establishing contacts, advice regarding the target market (local guidance) and financial support.

Much of this is particularly relevant for small firms. In particular, SMEs benefit from the following services:

  • intelligence-gathering trips to neighbouring markets;
  • individual export training for small businesses branching into exports for the first time;
  • support for Austrian stands at international trade fairs; and
  • 'Getting started with exporting' package tailored especially to small firms.

Potential exporters can also take a test of their 'fitness' to export.

‘Go international’ is managed through Advantage Austria and, as of 2020, consists of 20 specific internationalisation support measures. One of the measures is called 'Go Silicon Valley'. It can be regarded as a business initiation programme. Austrian companies are offered participation at a business accelerator in Silicon Valley for a period of one to three months, that is, they can use the accelerator’s services. These services include:

  • Use of an office (‘cubicle’) or coworking space for free (rent paid by the programme);
  • Introduction to US business habits and conventions, for example through the mentors mentioned below, instructions by the accelerators;
  • Networking and establishing individual contacts with possible partner companies, venture capital companies, business angels, lawyers, consultants and mentors;
  • Participation in finance forums and entrepreneurship workshops organised by the accelerator in Silicon Valley;
  • Financial support for mentor schemes, that is, costs of mentors are covered by the programme; suitable mentors are usually suggested by the accelerator and selected jointly by the accelerator and the Austrian company; 
  • Pitch sessions and presentation of the company’s business plan to venture capital companies and business angels through the help of the accelerators.

It is one or two people, usually managers with sufficient decision power of the participating Austrian company, who are supposed to go to Silicon Valley for the period stated above.

The budget is made available jointly by the Austrian Federal Economic Chamber and the Austrian Federal Ministry of Digital and Economic Affairs (BMDW). More specifically, the ministry contributes the financial funds while the chamber contributes in-kind through the administration of the measure and their staff. EU funding sources are not used. Over the last years the annual budget provided by the ministry has remained unchanged in nominal terms. The majority of the budget goes to covering the accelerators’ costs and those of the mentors.

The travel costs to the US and the cost of living there have to be borne by the participating companies. These costs can be estimated at €15,000. In addition, there is an administrative registration fee of €500.

As of June 2020, the programme has been expanded by new funding. The WKO now offers a digitalisation check ('Digitalisierungscheck') to financially support digital presence abroad ('digitaler Auslandsauftritt') with 50% of the digitalisation costs (up to €7,500).

Funding

  • National funds
  • Employers' organisation

Involved actors

National government
Funding (shared financing with Austrian Federal Economic Chamber (WKO), see below).
Employer or employee organisations
Operated by the Foreign Trade Department (Advantage Austria) of the Austrian Federal Economic Chamber (WKO), in cooperation with the Federal Ministry of Digital and Economic Affairs (BMDW); shared financing.

Effectiveness

Starting with June 2020, the follow-up programme 'internationalisation cheque' provides companies with grants for entering new markets with up to €10,000 for distant markets and up to €5,000 for European markets. Applications for the cheque are accepted until the end of March 2021. Over the course of the previous funding period which ended in March 2019, €56 million were invested.

Between 2013 and 2015 over 5,400 new exporters have been counted. Go international has approved 1,680 applications for funding. Recent evaluations show that every €1 of funding creates €55 in exports of material goods, €60 in added value and €15 in tax revenue.

In the period from 2010 to 2016, a total of 106 Austrian SMEs participated in the 'Go Silicon Valley' measure. Thereof, 20 companies established a branch, joint venture, or subsidiary in the US mainly to market their products there. Another eight Austrian companies received investments mainly (but not only) by US investors. Some companies have been bought and taken over completely.

In 2012, the Austrian Federal Economic Chamber won the first prize when it submitted Go Silicon Valley to the ‘TPO Network Award - Excellence in Export Development Initiatives’ of the International Trade Centre (ITC) as a best practice example of trade promotion programmes.

Strengths

The 'Go International' initiative's visibility among its target group is considered to be high. The decision-making process takes place within a short time frame. It has the support of approximately 100 economic chamber offices worldwide, in 73 countries. Its implementation is both simple and flexible.

The main strength of the 'Go Silicon Valley' measure are:

  • establishing new contacts and partnerships between Austrian and US firms, including client relationships and investment relationships;
  • the learning effect the programme creates;
  • the extended physical presence of the Austrian participants in the hot spot of Silicon Valley;
  • the use of first-hand local expertise makes it much more effective than networking programmes which operate over the distance;
  • the application process in Austria is that US experts are involved as a jury already at that stage which ensures selection of suitable participants.

Weaknesses

For the 'Go Silicon Valley' measure two potential weaknesses have been identified:

  • The measure’s budget remains unchanged in nominal terms. Because of increasing costs (of accelerators, mentors and others) funds are actually decreasing in real terms.
  • There could be a risk if a company uses funds to gain entrance to the US market and then transfers completely to the US. However, there is not much evidence that this has actually occurred. Those companies which set up branches or subsidiaries in the US have usually kept their technology development functions in Austria.

Példák

The Vienna-based software firm 'opvizor', which participated in 'Go Silicon Valley' in 2014, established cooperation with two US investors and together with them founded a new joint company in Houston. This also resulted in additional jobs at the Vienna headquarters. Overall, the CEO of opvizor established 250 contacts within the three month period.
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