Building a global business - by Vinny Lingham

Building a Global Business
– Lessons learnt
ByVinnyLingham

Building a Global Business – Lessons Learnt
Confidential & Private document. This remains the intellectual property of Yola Inc.
1

Yola’s Successes in the Past 3 Years
Began with a vision to create easy to use website building software
Spun out of Clicks2Customers (incuBeta Holdings)
Started as a 5 person company in Cape Town in March 2007
Pitched to over 25 investors – locally and globally before successful
Raised over $25m to date from JSE-listed Reinet Ltd
>3.5 Million Users to date and growing rapidly – market leader
Currently employs over 60 people in 3 countries
All of the above is only made possible by working with amazing people! The team you build is critical!
2

My biggest success in the past year:
3
Name: Kavin Lingham
Born: San Francisco, California
Age: 12 weeks old
Lesson learnt: Don’t lose sight of what’s really important in life!

Stage 1 – Friends & Family: Building a startup
Investment and timeline
R3.5m investment via R&D in previous company
Spun out and rebuilt from scratch
Launched alpha release for R750K in 6 months
Raised extra R1.5m to get to Beta
Raised Series A of $5 million
User base: 10K
Lessons Learnt
Get products out to market quickly – don’t be secretive!
Pitch to investors – have one person in the co-founding team look for funding while the rest work in engineering. Don’t get excited until you have a term sheet in writing!
Grassroots Attention (Blogging, Presenting)
Bootstrap
4

Stage 2 - Series A: Proof of Concept
Investment: $5 million
Establish offices in San Francisco
Get market traction
Prove monetization model
Targeted user base before next round of funding: 1 million
Lesson’s Learnt
Going global is expensive if you don’t know how
Hiring cold is a tough strategy – referral hires are the best
Building a product team is critical for funded companies
Splitting engineering teams is very difficult
Making friends in the valley is tough
5

Stage 3 – Series B: Growth
Investment: $20 million
Target user base before next round of funding: 5-6m users
Lessons Learnt
Use analytics to make data driven decisions
Viral growth is critical
Focus on a target audience and serve their needs
Don’t give too much away for free
Excellent customer support can be a strong differentiator
Focus on ease-of-use / UX
6

Inside secrets to securing investment
Great team
Good plan
Good networking
Great pitch
Good demo
Persistence
Passion for your biz
Show potential
Prove execution
Build products, not services!!!!!!!
7

South African Technology Re-Investment Conundrum
8
Traditional Timeline – non-entrepreneurs
Dependent
0-18 yrs
Student
19-22 yrs
Career Focused
23-33 yrs
Golden Age
54-65 yrs
Retirement $$$
66+ yrs
Creating Wealth + Family Focused
34-53 yrs
No $
Entrepreneur's
Timeline
Winding Down: Diversification & Conservative Approach
54-65 yrs
Dependent
0-18 yrs
Entrepreneur
19-33 yrs
Retirement $$$
66+ yrs
Reinvestment
34-53 yrs
No $
Entrepreneurs who make money tend to give back to new entrepreneurs.
Post apartheid, entrepreneurs who are still in their 20’s and 30’s will be giving back when they reach the reinvestment stage. There are not enough wealthy entrepreneurs in their 30’s in SA who understand tech, so the best is yet to come.

Interesting Paradox
9
Wealth
Risk Appetite
0
Time
Generally, wealth increases over time, while the propensity to invest is low
Conversely, people take more risks earlier in age when their wealth is low

Why I moved to Silicon Valley…
10
Vinny in Silicon Valley
Vinny in Silicon Cape

Reasons to be in the valley
Building a global business
Depth of talent and skills (people who have been there, done that)
Networking
Fund raising
Being ahead of the latest trends (getting an iPad the day it comes out)
Conferences
Business Development
Acquisition – Liquidity… (which hampers investment in SA)
11

Reasons to not be in the valley
It’s expensive in general, unless you bootstrap
Emerging market focus
You are not a good networker
You are very attached to your family and social networks back home
Your funding is very limited
You think you can be successful from South Africa
Modern telecommunications make it possible to be anywhere…
12

How to get to the valley
Fly Emirates – they are by far the best value for money (via Dubai)
Setup an offshore subsidiary – and transfer across into it (L1x Visa)
It’s easier than you think – you just need to want to do it!
Total estimated cost to setup an office and move to the valley for a local Cape Town company: R100k
Be careful what you wish for, you may just get it…
13

Why I’ll be back…
14

Thank You
15

Building a global business - by Vinny Lingham

by RAMP Group on May 18, 2010

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