TechBA + CSOFTIT Opportunities for Mexican SME Companies in

North America

Manuel Ribeiro February 12, 2013

1

• Nothing should be more important for any enterprise than to find and exploit new market opportunities. Even when business is robust, there is always the need to hunt for new turf, to guard against the time when a strong product or service category will become static or declining.

• Skill in finding new market opportunities is the lifeblood of business worldwide.

New Market Opportunities

• New market opportunities spring from a range of possible sources and vary in their size, importance, and risk. The list of places to look includes the following:

• Different uses for an established technology• Alternate or improved technology• Alternate offerings of service models,

supplies, and other annuities• New geographic regions• New demographic or vertical industry

segments• For IT entrepreneurs, the task of

investigating possibilities beyond their existing markets requires judgment, energy, creativity, and objectivity.

New Market Opportunities

Market Size

U.S. Canada Mexico02468

10121416

GDP (Trillion USD Current)

U.S. Canada Mexico $-

$10,000 $20,000 $30,000 $40,000 $50,000 $60,000

GDP Per Capita (Current USD)

U.S. Canada Mexico0

1020304050

Median Age

Heftier markets

Stronger Per capita Income

Older population

Market Size

2005200620072008200920102011

$6,000,000,000

$26,000,000,000

$46,000,000,000

$66,000,000,000

$86,000,000,000

$106,000,000,000

$126,000,000,000

ITC Revenues

Canada Mexico U.S.

Industry with a Steadfast growth

Canada and Mexico Common market

ITC Revenues Comparison

Canada Mexico U.S.

Salary & Wages

Austin Montreal

4300049000

5500060000

68000 69000

Entry Level Median SeniorJob Description for Software Developer I

Codes software applications to adhere to designs supporting internal business requirements or external customers.

Standardizes the quality assurance procedure for software. Oversees testing and develops fixes.

May require a bachelor's degree in a related area and 0-3 years of experience in the field or in a related area.

Has knowledge of standard concepts, practices, and procedures within a particular field. Relies on experience and judgment to plan and accomplish goals.

Performs a variety of tasks. Works under general supervision.

A certain degree of creativity and latitude required. Typically reports to a project leader or manager.

Alternate Job Titles: Entry Level Software Developer, Software Developer I

Pros

7

Market Size Talent Pool

Population Dynamics

Cultural Similarities

Time Zone

Exchange Rates

Competitive Costs

Canadian Salaries going up

Cons

8

Language Barriers

Lower Financial capacities

Limited Research

Access to venture capital

Higher Interest Rates

Entrepreneurial culture

Over-specialization

Windows of opportunities forMexican IT Industry

9

Game Related services and products• Advergames and gamelets• Content publishing, and translation• Testing and User Experience design

SaaS Conversion Services• SaaS product development

Mobile platform conversion services• Content creation, curation and translation• Cross-platform delivery services and programming• Testing

Cloud integration Services• Cloud Hosting Services

E-Health

Financial Services

Process monitoring & Productivity

System integration in Aerospace industry

Verical Markets

How to Export your IT Services & Products to North America?

10

Creation

•Developing new products.

•Adapting successful local products to new markets.

Innovation

•Adding value to existing solutions

•Using international benchmarking & standards to gain local markets

CompetitiveAdvantage

•Take advantage from macroeconomics:

•Competitive Salaries

•Government incentives

Partnering

•Positioning Mexican companies as the door to Latin American markets

•Adapt Canadian and US products and services to specific local needs

How to Export your IT Services & Products to North America?

11

AccelerationPreaccelerationToday

Step 1 Diagnosis

Step 2 Discover and create your

Hypothesis

Step 3 Get Ready to get ready

Step 4 Expose Yourself Montreal

Step 5 Decision making

Step 6 International Action Plan

Execution

Step 7 Feedback & Ramp-up

Quebec ITC Outlook

12

Multimedia Industry

• 80 businesses involved in games development, publishing, production services, software and middleware

• International reputations.• Employs 7,000 people (plus

many other jobs indirectly)• Revenues over $1 billion.• Creativity and quality of its

resources. • Renowned training

institutions with over 5,100 graduates each year

• Extraordinary conditions for high-tech companies wanting to do business in Québec.

Computer services and software industry

• Primarily integration and outsourcing services.

• Mostly located in Metropolitan Montréal.

• Designing vertical and generic application software.

• Investissement Québec can advise you or provide funding for your business to set up shop or expand in Québec

Telecommunications industry

• Energetic, innovative and avant-garde.

• The sector is concentrated in Metropolitan Montréal

• Benefit from the presence of a number of renowned research centres.

• Total sales in this industry are edging up to the $9 billion mark.

Ontario ITC Outlook

13

Software and systems developers•HP, IBM, Microsoft, Oracle, Siemens have their Canadian headquarters and R&D in Ontario

•Number of homegrown high performers got their start: Constellation Software, Corel, Cyberplex, Descartes Systems, MKS, OpenText and Platform Computing.

Wireless and telecommunications•RIM has reinforced Ontario’s long-standing reputation for innovation and excellence in telecommunications.

•Home to more than half the leading companies in Canada’s $16 billion wireless industry such as Rogers Communications, Alcatel-Lucent, Ericsson and Nokia.

Digital media•More than 950 interactive digital media firms that generate about $1 billion in revenue each year. Growing at a rate of 30 per cent a year.

• Includes premier games developers/publishers: Beeline Interactive, Gameloft, Tecmo Koei, Ubisoft, Artech Studios, Digital Extremes and Magmic Games.

Animation and special effects•Recognized leaders as Autodesk Canada, Nelvana and Side Effects,

•Award-winning film and television productions.•3D-industrial design and training simulators.

E-Health•North American centre for life sciences and ICT•High performance e-health solutions. •Helping major international firms (Agfa HealthCare) and domestic providers (Nightingale Informatix and Diversinet) succeed in a rapidly growing field.

Security software•World-leading Certicom, (clients include : U.S. National Security Agency (NSA), IBM, Continental Airlines, General Dynamics and Sony Ericsson)

•This sector includes other world-leading Ontario companies like Third Brigade and international providers such as McAfee, Symantec and Cisco Systems.

Green IT•Companies in Ontario are making breakthroughs on every front, from Zerofootprint to Fifth Light Technology.

Debemos buscar la internacionalización?

1. Nos sentimos más cómodos bajo nuestras fronteras y nos parece que traspasarlas es cosa de grandes corporativos. Nos conformamos con un mercado limitado y cuyo crecimiento se estancará en algún momento. ¿Por qué no internacionalizarse? La apertura al extranjero supone la apertura al éxito si se hace correctamente. Si el negocio nos va mal por falta de mercado es un buen motivo para salir fuera, si nos va bien, ¿por qué no hacerlo crecer en otros países?

2. Estamos cómodos en nuestras fronteras, cómodos con nuestro idioma. Es hora de cambiar. Debemos abrir los ojos y ver el mercado extranjero, la internacionalización, como parte de nuestro futuro de expansión del negocio. La internacionalización ha de dejarse de ver como un gran reto al que enfrentarse sólo cuando las cosas nos van muy bien para convertirlo en un paso necesario durante el crecimiento de la compañía, cualquiera que sea su estado, siempre que el modelo de negocio lo requiera.

3. No todas las compañías son susceptibles de internacionalizarse (por lo menos no en el sentido estricto de la palabra).

4. Habrá empresas que por sus servicios o productos no necesiten o no deban realmente internacionalizarse. Se ha de tener un plan para llevarlo a cabo en el momento adecuado.