Fryslan House is a shared office formula for Frisian and Northern Netherlands companies to start internationalisation or business development in other cities.
By opening a shared office in New York (Manahattan) and Riga (Latvia) we have assisted 15 SME companies to start their business activity in the US and Latvia (Baltics). The office forms a spearhead or springboard for companies to have permanent residence in another city and a representative (agent) included. We have searched for Dutch nationals in the the US and Latvia and found people with a relation to the local business community, acting as an agent and running an office. We have contracted them as host organisation and started looking for Frisian companies willing to built up a position in these countries, but lacked time and funding to be active on that market by theirselves. The companies are member of the Fryslan House and pay a yearly contribution. In return they can use the address in Riga and New York as a communication address and also meeting address.
The reason for the selection of Riga and New York was the following. For Riga, we have evaluated the growth ambitions of the Baltic States, a trade region for the Norhern Netherlands with original roots. There is good chance to find a stepping stone contact in that region for doing business in Russia. We found a original Frisian person, working in Riga to represent our model. That is why we choose Riga as base. For the US, the initial demand was from the regional Frisian government to join the 400 year relationship between New York and Friesland. The Fryslan House model provided the perfect business match for it.
Funding was provided by the regional development fund from the Province Of Friesland. None labeled funding for improvement of SMEs. Approved by the Provincial Governor. Total amount needed for 3 years: 100.000 Euro gov. funding. 50 % co-financing.
Evidence of success
Out of 25 SME members, 15 have reached new business results with the formula. 8 in Riga, 7 in New York so far. The total export added value for the SMEs have been 500.000 euro extra exports in the Balitc States via Riga and 4 Meuro for the US.
From a 200.000 euro investment of public money, 4.5 Meuro extra turnover has been realised.
The challenges in the US were to find a suitable partner. In the name of Jacob Willemsen we found a reliable partner, known by the consulate and with good contacts in the legal and banking world.
Potential for learning or transfer
This proves that a peripheral region like Friesland can provide an international scaling platform by taking risk in opening a foreign office. Based upon 5 participants, the yearly costs of about 10-15.000 euro can be returned and the model can be operated. In New York we now use a model where we pay per client 80% of our income to the agent in NY. This means we always make some gross profit to cover for administration costs and other fees. The start of the programme per city was sponsored by the regional government.
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