In the world of business, growth is often equated with having an overseas presence. Trends currently show that over 50% of Chief Financial Officers now play a part in a company’s pursuit of overseas expansion, which is an interesting statistic, as it shows their role is evolving.
Key Drivers of Overseas Expansion in the Tech Market
There are numerous motivations for expanding into the international market. A lot of the time, a diversified portfolio is a key driver. CFOs know that by entering multiple geographic markets, it becomes possible to reduce dependence on a single economy, while also mitigating risk. Netflix for example, expanded their content library to include region-specific TV shows, to cater to a global audience. This included K-dramas, such as Squid Game, which has since become a huge title for the company.
Another example would be iGaming. Many iGaming companies offer European roulette alongside American roulette, which is the dominating format in casinos across the US. This is a key way to attract markets that prefer the European version, with more localised game features, such as a single 0, rather than the double-zero featured in the US variant.
When it comes to digital offerings, it’s a lot easier to expand overseas, with rapid expansion being the key to staying relevant in a diverse landscape. It also helps to drive growth in new markets, while listening to local consumer preferences. As CFOs are primarily responsible for risk management and financial gain, it makes sense that they are now spearheading expansion campaigns on a higher level than ever before.
93% of CFOs Believe their Role has Changed in Recent Years
Studies have shown that 93% of CFOs believe that their role has expanded within the last three years. The role has gone from managing finances to understanding regulations, global expansion, and sustainability. With CFO tools set to increase by 18% over the next five years, this just goes to show what a vital role they now play. Over the last few years, there are clear examples of CFOs who have had a significant impact on global expansion too. David Wehner, CFO of Meta, has had a huge influence on the company’s expansion to Latin America, India, and Europe. Stephanie S. Bell, CFO of Shopify, has also played a role in the company’s growth in Asia and Latin America, ensuring the localisation of the platform through financial leadership.
Ruth Piorat, CFO of Alphabet Inc. also played a pivotal role in the company’s expansion strategy. She led several initiatives that helped the company to expand in Asia and Africa, places where internet adoption was accelerating at the time. The company invested in infrastructure under her guidance, which included building undersea internet cables and data centres. Porat ensured the venture aligned with the long-term growth goals of Alphabet while carrying out careful risk assessments. Examples like this help to show how CFOs across numerous tech verticals are driving successful globalisation, using their financial knowledge and risk assessments to play an even bigger role within the company. As time goes on, it wouldn’t be surprising to see tech companies embrace the role of the CFO further, given the recent success of many global expansion campaigns.
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