Businesses that are focused on growing the top line and obsessive about cost control are the most desirable investments, and businesses with such a focus are less likely to embrace a hype cycle or get carried away with thoughts of world domination.
Keep the home fires burning
The other way for a small cap to refrain from thoughts of world domination is to avoid geographical expansion altogether. The further you go, the riskier it gets.
People underestimate cultural differences and assume that if something works in the UK it will work in neighbouring Continental Europe and equally work in the US, where they speak the same language.
Wrong! Conquer your own backyard first and then, only then, look for opportunities further afield. Be obsessive about the home market first, be the biggest you can be in the market, then look further afield.
Too often we see businesses that are average in their domestic market, and view forays into foreign fields as a solution to problems on the home front, but that only leads to average outcomes everywhere.
Lorna Tilbian is a former top rated media analyst, a co-founder of brokerage firm Numis and the current executive chairperson of Dowgate Capital.
