"Grow your own domestic market" — Shark Tank's investor Kevin O'Leary gives honest advice on scaling business globally

In an April 21 Instagram post, the Shark Tank investor Kevin O'Leary talked about how to expand someone's business globally. Kevin advised business owners to focus on their domestic market first. According to him, they should build a strong foundation in their local market before expanding globally.

"Grow your own domestic market, first. Make your mistakes there, and once you've got that as a fine-tuned engine, then you expand other jurisdictions," stated Shark Tank's Kevin.

Kevin believes that by mastering their domestic market, business owners can create a solid base for international expansion. The entrepreneur, also known as Mr. Wonderful, has been a part of ABC's Shark Tank since 2009, investing in various businesses across 16 seasons. He's invested in a total of 129 companies, either solo or with other sharks.

His own notable ventures include O'Leary Fine Wines and O'Leary Funds. He owned SoftKey Software Products, which acquired The Learning Company and later sold it to Mattel. He also has acquired a net worth of $400 million through his various business ventures, according to Celebrity Net Worth.

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Shark Tank investor Kevin O'Leary's insights on scaling startups and embracing failure

The Shark Tank investor talked about scaling startups during uncertain economic times in the Elevate 2022 conference in November of that year. Kevin shared insights from his own business experience, noting that companies run by women in his portfolio achieved better results in terms of meeting growth targets. These companies set lower growth targets, around 15%, and met them 95% of the time.

In contrast, companies run by men set higher targets, around 30%, but only met them 65% of the time.

“What we found out was, when you hit your goals consistently, the culture changes in a company. Even though your target is much less, your culture is very sticky," stated the Shark Tank investor Kevin O'Leary.

These companies had lower employee turnover rates, less than 2.5%, compared to companies that missed their targets frequently, which had turnover rates of around 35%. After analyzing this data, Kevin advised his CEOs to set realistic targets that they could meet at least 90% of the time. This approach led to a significant drop in employee turnover and an increase in free cash flow.

He shared his experience with his portfolio companies, noting that in March 2020, all of his companies faced negative cash flow due to the pandemic. According to Kevin, this was a unique challenge that the entrepreneur had never seen before.

Kevin opened up further about the current economic situation. He stated that despite expectations of a slowdown, he hadn't seen it yet in his business. His companies were still performing well, with no signs of reduced sales.

“I can’t forecast the economy next year, but I do know that this is an unusual recession. I can’t hire anybody, we’re at full employment. I see no reduction in sales on the tear sheets each week. I’m waiting for the slow down, I have not seen it yet,” stated Kevin O'Leary.

During the conference, Kevin O'Leary also advised entrepreneurs to learn from their failures, whether it's a major setback or a new initiative that doesn't produce expected results. He expressed that entrepreneurs who have experienced failure multiple times are more motivated and better equipped to succeed in the future.

According to O'Leary, the key is to "learn from the mistake," which helps entrepreneurs develop the skills they need to succeed. He further mentioned that he preferred investing in seasoned entrepreneurs who had a track record of failure and learning from it.

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Kevin O'Leary can currently be seen on season 16 of ABC's Shark Tank.