1. Startups: Go LOCAL or
Mountain View, CA (Feb 2014)
2. This Talk Is About…
• 500 Startups
– Internet Seed Fund + Accelerator + >100 Intl Startups
• Assessing Global Markets
– (# users, by language/geo) * (avg $ GDP) * (% internet) = avail online spend by lang/geo
• Why You Shouldn’t Go Global
– You’re a Crappy Little Startup with no customers, revenue, or funding
– You Don’t Speak the Language (not very well, anyway)
– Your local market is >50M+ users, and nobody else is going after it
• Why You Should Go Global
– You Live in a Small Country / Startup Ghetto
– There aren’t any local market investors worth a famn.
– There ARE local market investors, but they might be predatory, too revenue-focused, riskaverse
– Your customers and partners are in [X] (where X = California, NYC, London, Beijing, Brazil,
4. 500 Startups
Mountain View, CA – Founded 2010
• Seed Fund & Startup Accelerator
– $90M under management
– ~30 people / 12 investing partners
– 10,000 sq ft / Silicon Va
– SV, SF, NY, MEX, BRZ, IND, CH, SEA
– 1000+ Founders / 200+ Mentors
– Focus: Design, Data, Distribution
• 650+ Co’s / 200 Intl / 40+ Countries
– Wildfire (acq GOOG, $350M)
– MakerBot (acq SSYS, $400M)
– Viki (acq Rakuten, $200M)
– other shit
(my excuse for an Intl road trip w/ geeky friends)
Travel The World with Geeks & VCs
Meet MORE Geeks & VCs in other countries
Learn about Intl markets, technology, people
Get drunk & eat great food with friends who
don’t speak your language ☺
• East Asia (3x), Europe (2x), LatAm (2x), India
• Next: Middle East, India, SE Asia, Africa
6. Global Languages
• English: 1-2B+ ppl, most online, high GDP, modest growth
• Mandarin: 1B+ ppl, lots online, med GDP, flat growth
• Spanish: 500M+ ppl, some online, med GDP, strong
• Arabic: 500M+ ppl, some online, low/med GDP, strong
• Others: Hindi, Portuguese, French, German, Japanese,
Russian, Korean, etc
7. Global Markets
US/Can/UK/AU (400M+): big market, not much growth but lots of spend
Europe (400-500M): not much growth, many lang, high GDP
China / E. Asia (1B+): lots of ppl, growing usage / GDP, flat growth (pop.)
LatAm (500M+): Brazil, Mexico, Argentina, Colombia, Chile; LOTS growth
India/Pak/South Asia (1.5B+): lots of ppl, growing mobile, strong growth
SE Asia (600M+): Indonesia, Vietnam, Thailand, Philippines; strong growth
Middle East / Arabic (500M+): growing mobile, lots of future growth
Africa (700M+): growing infrastructure, lots of future growth
8. How to Assess Global Markets
1) # of ppl / language speakers by geography
2) % internet usage (web, mobile, smartphone, etc)
3) $ Avg GDP / $ online spend / disposable income
Online spend / lang, geo = (#ppl) * (%internet) * ($GDP)
– % Growth rates of ppl, lang, internet, GDP
Currency, country, culture, etc
Online disturb platforms (search, social, mobile, video, etc)
Online payment methods / credit card distr
Physical goods delivery / logistics
Social media usage / behavior
3 markets in 1: rich, middle-class, internet poor
9. Distribution Platforms
Customer Reach: 100M+
• Search: Google (also Baidu, Yandex, Yahoo-J)
• Social: Facebook, Twitter (also TenCent, Sina, vKontakte)
• Mobile: Apple (iPhone, iPad), Android
• Media: YouTube (Video), Blogs, Photos, Music
• Comm: Email, IM/Chat, SMS, Voice
10. Why You SHOULD NOT
because ur a tiny little startup,
you don’t speak the language,
& your local market is big enough
11. Why Stay Local? Because it’s HOME.
• You don’t speak English (well enough).
• Your solution won’t travel well / you won’t localize it
• There’s not as many people competing locally.
• Your local market has 50M+ users.
• You have customers / revenue.
• You have great living situation, family, kids, etc
12. Why You SHOULD
Because u live in a tiny little country,
local investors are too conservative,
don’t write[enough] checks
and/or give u crappy, low valuations.
13. Why Go Global / US / China?
(because California is *awesome*)
• It’s BIG. (US, China are huge markets)
• All the [rich, online] customers are here.
• All the investors are here (Silicon Valley)
– also: Local Investors Screw You / Don’t Invest / Low Val$
• All the platforms & partners are here (Silicon Valley).
– NorCal: Google, Facebook, Twitter, Apple, Android, YouTube
• Because you watch too many action movies and rap videos.
• Because you love California / NYC. (hey, we understand ☺)
14. Angel* List: It Rocks.
Startups & Investors
Activity & Metrics
Platform & APIs
*ps – not just for Angels,
not just for USA
15. How Big is MicroVC / Seed Stage Market?
5,000 microVCs invest 100,000 startups/yr @ $500K/startup = $50B/yr
$500K/startup = $50B/yr
How many people are entrepreneurs? How many startups get started every year?
• ~1% of Humanity is “Entrepreneurial” (def’n: “can create a $10M rev/yr business”)
• 1% x 7B ppl = 70M entrepreneurs, each of which starts 1-5 businesses lifetime
• 1-5 startups / 75 yrs avg life = (~1 startup/25 yrs) * 70M = ~3M startups per year
How much capital is needed globally to get seed stage startups rolling?
• Assume 1M-3M startups/yr x $50K-$500K funding/each
• Low: 1M x $50K = $50B/yr (*this is the LOW end estimate)
• High: 3M x $500K = $1.5T/yr (that’s “T” as in “Trillion”…)
How many metros? How many investors / metro? How many startups / metro?
• 1 microVC can do 10-20 startups/yr * $50K-$500K = $500K-$10M/yr budget
• 100-500 global metros @ >1-2M ppl can generate ~500-2,000 startups / metro / yr
• guesstimate = ~100K-200K startups/yr in top 200 global metros
• 10-50 micro VCs / metro * 200 metros = 2,000-10,000 microVCs globally
• EST: 5,000 microVCs can deploy $5M/yr each, or $50B/yr in ~100,000 startups