TechBA Roadshow 2008
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TechBA Roadshow 2008

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TechBA Roadshow 2008 TechBA Roadshow 2008 Presentation Transcript

  • Understanding the US Market Jorge Zavala CEO TechBA – Silicon Valley September 2008
  • Agenda
    • The Silicon Valley – Environment & Ecosystem
    • Expanding into US – Common Mistakes
    • The Effective Process
  • I. The Silicon Valley
  • Facts about Silicon Valley
    • 2.4 M population
    • 40% of population is foreign born
    • 40% with least a bachelor’s degree
    • 23% speak Spanish
    • Maintains 35% of the U.S.’s entire venture capital resources.
    • 11% of all U.S. patents generated here
  • San Jose Fact Sheet
    • Largest city in the 9 county Bay Area
    • 3 rd largest city in California
    • 10 th largest city in U.S.
    • Population: more than 1M
    • Around 7,000 high-tech companies
  • Silicon Valley = Innovation Environment
    • Rewards risk and accepts failure
    • Results-oriented
    • Smart and creative workforce
    • Industry clusters
    • Intellectual capital abounds with universities and national research institutions
    • Collaboration between government, private industry, development community and academia
  • II. US Expansion Process: Common Mistakes
  • Common New Market Expansion Issues
    • Company establishes operations in a new market only to pull out less than 1 year later
    • Company does not meet sales goals
    • Staff does not assimilate into the local business culture
    • Marketing message is not right or not tailored to the local market
    • Selling on the basis of “we are low-priced” rather than “we deliver good value.”
  • How Does This Occur?
    • Lack of preparation
      • Little market development or research
      • Minimal company-wide planning or goal-setting
      • No company market entry team created
    • Lack of consideration for differences in culture, communication patterns and buying habits
    • Underestimating market complexity
    • Underestimating the competitors
  • U.S. Business Culture
    • Business and legal structures are rigid.
    • Deal terms and pricing take priority over personal relationships, most times.
    • In general, U.S. buyers:
      • respect achievement, success, wealth
      • respect punctuality and accuracy
      • respect adherence to instructions
      • are very competitive
      • have very short attention spans
  • Common Sales Mistakes
    • Not understanding the market
    • Unclear value proposition / message
    • Lack of a sales process
    • Ineffective hiring of sales representatives
    • Not selling value to the prospective customers
  • Effective Preparation for Growth
    • Conduct market research
    • Validate your message and refine the value proposition
    • Make changes to your product or service
    • Create marketing materials or modify existing ones
    • Obtain government approvals, permits
    • Protect the intellectual property
    • Hire consultants, advisors or employees
    • Establish a viable customer support strategy
  • Effective Preparation for Growth
    • SWOT analysis
      • S trengths
      • W eaknesses
      • O pportunities
      • T hreats
    • Leverage from your position of strength
    • Expansion may not necessarily include the company’s entire product suite
  • Create a Market Entry Success Team
    • Who participates in this team and why?
    • Representatives from every functional group in your company
    • Sales, marketing, engineering, support, finance, operations, legal, services, strategic alliances, business development, and perhaps more….
  • Plan Accordingly
    • Staffing
    • Capital investment
    • Realistic sales goals
    • Realistic timelines
    • Reassess every 90 days
  • Never Underestimate…
    • Cultural differences
    • Language differences
    • How relationships develop
    • Business style differences
    • Negotiation style differences
    • Sales cycle vs. the buying cycle
    • Complexity of the market
    • Competitors
  • III. The Effective Process: How to get inside Silicon Valley
  • The Effective Process
    • 1. Find the “best” product or service
    • 2. Analyze your market
    • 3. Define a clear marketing strategy
    • 4. Get a proof of concept and sales strategy
    • 5. Tune your company to scale
    • 6. Get the the right team to execute
    • 7. Establish a Clear Legal structure
    • 8. Set high entry barriers (IP protection)
    • 9. Have a clear future path (permanent innovation)
  • 1.The Product or Service
    • Solves a big problem (Fills a gap)
      • Must have vs. Good to have vs Nice to Have
    • Has a large and growing market
    • Sustainable competitive advantages
    • Scalable
    • High entry barriers
      • Complex technology
      • Intellectual property protection
  • 1.The Product & the Opportunity Looking for the Gap ProvidersNeeds Need1 N2 N3 N4 N5 N6 Large P1 X X X N/A P2 X X N/A P3 X N/A P4 N/A P5 N/A Medium P1 X X X N/A P2 X X N/A P3 N/A P4 X X X X N/A P5 X X X N/A
  • 2. The Market
    • Find out
    • Size of the market , and how it is growing : (trends) according with known analysts.
    • Identify segments
    • Who are the main players: competitors, distributors, influencers per segment
    • Client’s key decision factors per segment
    • Your competitive advantage
  • 3.Go to Market Strategy :
    • Segments ( verticals?)
    • Pain ?: different for different segments
    • Decision maker ?
    • Key decision factors?
    • Biz Model: For example:
    • Rent or sale ?
    • Price (not based only on cost) VALUE
    • Channels (Distributors, internet?)
    • Marketing Materials and Public Relations
  • 4. Sales strategy
    • Find out where to find your clients (events)
    • Where to find your partners/channels
    • How to open the door (communications)
    • Get your beta clients
    • Get your first paying clients in the segment you are focusing on ( references)
    • Plan your expansion ( Channels? Partners? Sales people?)
  • 5.Scalable Operations
    • Plan how to SCALE your business (productivity per employee)
    • Lead generation and follow up ( website)
    • Channel support and training( Webex, Interwise)
    • Local and remote client /partner support
    • ( e-learning)
      • Pre-sales
      • Post- sales
    • Sales ( Internet? Amazon)
  • Value of the Knowledge (Wealth per capita – from $1M to $22M)
    • SV Corporations – market value vs. number of employees
      • Cisco (1984) - US$147B – 50K employees - $3M/employee
      • Google (1999) - US$130 B – 5.7K employees
      • $22M/employee
      • Intel (1968) - US$118 B – 102K employees
      • $1.2M/empoyee
  • 6.The TEAM
    • Local CEO ( serial entrepreneur)
    • Business Development / Marketing & Sales VP with strong Knowledge of the market
    • The CTO
    • The Lawyer
    • Strong Board of Advisors
    • Strong Board of Directors
  • 7. Legal structure in the US
    • Subsidiary, independent or head quarter?
    • C -Corporation or LLC
    • Where ? Delaware- California – Florida?
    • Agreements ( employees , client licenses , distributors, contractors)
    • Stock options plan
  • 8. Protect your Intellectual Property
    • Patents in the US( protect the idea )
      • Provisional patents
    • Copyrights ( protect the form- software)
    • Trade Marks, logos etc( registration)
    • Trade secrets ( coca-cola) restricted areas
    • Non Disclosure Agreements (NDA)
  • 9. Clear future path
    • Product Road Map (innovation)
    • Sales and revenue forecast (3-5 years)
    • Operational needs
    • Financial needs
      • Bootstrapping or Investors?
    • Financial exit
      • Acquisition – Potential buyers
      • IPO
  • The Effective Process ( Summary)
    • Unique product for a big, growing market
    • Clear marketing and sales scalable strategy that lets you penetrate the market in a short time frame
    • Clear future path (permanent innovation)
    • The right team to execute
    • Clear financial projections & needs
  • Thanks!
    • Q & A