SuperMovil - Telco startup market expansion

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After the prompt, the candidate is entitled to ask some questions. Data to be provided to the candidate:

• SuperMovil currently operates in Europe, in concrete:
  • France: where they partner with JaunePhone
  • Italy: where they partner with WindyMobile
• SuperMovil only offers data-bundle packages (e.g., with your SIM card you can only have internet access, no "normal" calls) – Particularly targeted to tourists and young populations who are very eager to explore this option.

Example of an excellent structure (presented as an issue tree):

ECONOMIC FACTORS

• Overall market analysis: conduction of deep analysis on:
  • Market size
  • Market fragmentation:
    • Are there any other Telco start-ups with similar business model to ours? – Given that the key to our success is the ability to move and escalate fast, we need to keep in the radar other players operating the same way.
    • Who are the main "traditional" Telcos? (CAPEX owners) per market? – Key for this particular case, since they are needed business partners for our expansion
  • ​Estimated market trends: both short and medium term
• Analysis of potential new markets: conduction of deep analysis on the shortlisted countries around key KPIs in order to identify the ideal target:
  • Potential number of users
    • Population
    • Penetration rate
  • Industry & segment growth rate
  • Stability of the market
• Operational approach: SuperMovil rents capacity from traditional Telcos, which grants them operational speed. In order to penetrate a new market, options are:
  • M&A (Merger & Acquisition): buying a Telco in the new market that operates with the same business model (i.e., renting capacity)
  • JV (Join Venture): partnering with a traditional telco:
    • Local Telco in the targeted country, targeting the most insteresting one in terms of:
      • Market penetration
      • CAPEX (antennas, fiber optic, etc.) availability
      • Company's health and stability
    • Local Telco in the targeted country that is a branch from one of their current European partners, in order to leverage the established business relationship

SOCIAL FACTORS

• Brand perception risk when moving to a new location (particularly outside Europe, their current market)
• Operational risks in a new and unknown market (particularly if outside Europe), highly influenced by:
  • Culture
  • Population density
• Post-merger integration risks (after M&A):
  • Integration of vision, mission and values
  • Different working cultures
  • Different compensations

POLITICAL FACTORS

• Anti-trust regulation compliance, when expanding inorganically
• Need to adapt to new regulations in the new markets - Telco is a highly regulated industry

IMPORTANT NOTE: Social & political factors, that encompass the risks of the operation, are key in the case. Structures without them lack a key part of the analysis