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International startup expansion Wayra jul/14


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Tips and lessons for startups looking for international expansion

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International startup expansion Wayra jul/14

  1. 1. International startup expansion Wayra, Jul/14
  2. 2. Fábio Póvoa
  3. 3. $mart money  Money:  Seed, angel and follow-on  Hands-on work  AARRR growth / Mkt experiments / Biz dev deals  Strategy, operating experience & best practices  Networking  Raising money: series A early efforts
  4. 4. My past global experiences
  5. 5. Why go Global ? Who went ?
  6. 6.  Massive home market  One language One (& stable) currency Legal system
  7. 7. Maximize chances for international expansion: 1. Lay growndwork right from the start 2. Launch with an owner, strategy and plan 3. Apply key principles and best practices
  8. 8. Lay down the groundwork right from the start
  9. 9. Make the company’s mission GLOBAL from the outset.  To organize the world’s information and maket it universally accessible and useful.  To bring inspiration and innovation to every athlete in the world.  To make the world more open and connected.
  10. 10.  Mix in some international DNA  Make localization mandatory for senior PM / engineering hires.  Recruit board members / advisors with international perspective  Track relevant development overseas  Inbound traffic by country  Emerging players  Local partners Team building
  11. 11. Make right coding choices  Localization should be upfront priority  Localiz. = adaptability to different languages and regions WITHOUT development time  Consider crowdsourcing your label translation  Kick off your community efforts with a global user base  Obvious: customer facing. But do not forget revenue- related systems  Billing, payments, accounting  Leverage local players for in-country specifics  Take Iugu for example
  12. 12. Protect your IP  Register trademarks and domain names in the top 10-20 world economies  You don’t want to invest in building a killer global brand only to find someone registered it before you in Russia  Make sure your IP protection plan covers you worldwide  Check out WIPO (World Intellectual Property Organization)
  13. 13. Time check & questions Up next: Planning: developing a global strategy
  14. 14.  You’re a  consumer Internet co., and a German partner offers you a deal  enterprise sw co., and your sales guys land a Japanese customer to make the quarter  It rarely turns out well:  Markets may have limited potential  Cost to serve may be higher  All of a suddent:  Customer commitments get missed  Sales sold: product people, not involved, have to deliver  International expansion just turned into a bad name International by accident: tale of a disaster
  15. 15. Going global: make it deliberate & strategic Craft an explicit, well-communicated, company-wide international strategy that will act as your Co.’s True North as you cross the border  Address 5 key topics: 1. What’s our goal ? 2. What countries will we focus on ? 3. With what products ? 4. How we will go to market ? 5. What’s our operation model ?
  16. 16. No one – aside from VCs and the former Soviet Union – requires 5 year plans to forecast a series of unknowns. Plans are generally a piece of fiction, and conceiving them is almost always a waste of time. What is our goal ?  Big, specific, measurable and inspiring objectives that will set the bar for the rest of the strategy  Qualitative ... “No. 1 player in mobile gaming in the top 5 world mkts by 2025”  ... quantitative “Generate 50% of our revenue from outside Brazil by 2030”  My suggestion: make it both!
  17. 17. No one – aside from VCs and the former Soviet Union – requires 5 year plans to forecast a series of unknowns. Plans are generally a piece of fiction, and conceiving them is almost always a waste of time. Which country/ies?  This is your most important decision  Think through on a set of criteria that defines an attractive market  Language, GDP, pop. (per capita), competition, prod mkt fit, localization efforts, smartphone/broadband penetration, customer/partnership leverage  + your company biz model specifics.  Start a quantitative, data-driven analysis (aka spreadsheet)  Weight different criteria accordingly  Analysis suplements judgement (China example)
  18. 18. With what products?  Product  Unless you are a very horizontal product (say Twitter, Facebook, Google), you will need prod. requirements + plans for every mkt you enter  Allocate founder / prod mngmnt / engineers / resources
  19. 19. Go to market strategy  Your value prop. might dictate strategy:  Mobile app (app store penetration, or telco partnership)  Enterprise: direct sales force or channel partner  Freemium: seed top 10, and then target most succesful ones with direct sales  Local clones: buy or build decision  Rule of thumb  Beware of single partner reliance  Avoid joint ventures
  20. 20. What’s our operation model ?  In the rush to launch overseas, this is the most overlooked question  What functions will be hold centrally x what will we do locally (thus hire !)  See Google x Facebook strategy for Brazil, for instance  Movile: VAS & PlayKids  Key issue: have a common tech platform and clear command structure  Op. Model drive organization structure decisions.  In most cases, a matrix works best: centralized consistency + efficienty tied to localized customization and execution  Aim for low overhead & rapid execution
  21. 21. LOT’s of work, hein ? As the CEO: sponsor, assign someone passionate & independent to do it. Up next: Ownership &
  22. 22. Day to day gets in the way  In a startup, there is always more TBD than available time or resources  In high-growth companies, core domestic business will consume most of mngmnt’s attention and the support of company functions  Going global thus needs to be a LONG-TERM project that demands SUSTAINED effort  International aspirations will go UNFULFILLED unless  started with an explicit strategy  adequate resourced  led by an exec with ability, authority and time
  23. 23. Assign an owner from the get go: his/her role is to:  Be the voice of international on your team and throughout the company.  Become THE expert on overseas trends, competitors, mkts, partners, users, customers  Get out of the office: visit key overseas mkts, gain 1st hand knowledge and build reputation and relationships, set up productive, efficient visits for you & other members  Represent the company at overseas industry events  Lead the development of the international strategy  Lead discussions and negotiations with partners  Recruit and lead a small global startup team  Potentially manage the initial startup in the 1st several
  24. 24. Ideal candidate:  Not your sales guy (or your domestic growth ...)  International experience, English / Spanish, knows the company well, seen as passionate, credible and impartial by the rest of the team  You trust to speak at conferences / represent at negotiations  Has time for frequent international travel / to live abroad  Given demands, no day-to-day operating responsibities  Typical challenging role for a domestic biz dev mngr
  25. 25. A startup within a startup:  One is really hard, two in parallel is ... a growth necessity. The visible. And the invisible: Staff + Funding Visible can’t be ignored. But there is great temptation to ignore the invisible. “We have a great team, they will figure it out and get it done” is a big mistake Remember: if it’s unfunded, it’s not going to get done.
  26. 26. As the CEO:  Look for ways to make it clear to the company that going international ia a critical priority for you personally  Involvement builds commitment. Take time to get buy –in from managers: they are/will be overloaded. Make it THEIR plan  Assign a small support team at HQ  Make it count: eading a biz dev should be a huge challenge &
  27. 27. Remember to treat International as a startup: • Be realistic in setting schedules and milestones: it will take longer • Be prepared to live with a startup financial profile: several years of losses before profitability • Report on International biz separately from domestic. Similar (or steeper) growth profile, but years behind • Be ready for exceptions for corporate policies. Ex. Compensation for top overseas hires • Make sure everyone’s perf. Objectives and incentives encourage global rollout.
  28. 28. (cont.)  Take time zones into consideration. Your work hours may be their sleep time.  Bring overseas hires for a month at HQ to soak up culture, value proposition, products and personal relationships.  Send out regular progress updates. A live video feed / high res TV + connection for calls works great.  Make it fun and celebrate success. Launch Global ops with themed party.  Protect and nurturel International business. Avoid compromising it after domestic revenue shortfalls or
  29. 29. 1. No corporate champion / accountability. 2. Lack of commitment / understanding from the rest of the company 3. Reactive approach 4. Failure to dedicate resources (e.g. product development, support) 5. Cut back international projects to save the P&L 6. Treat overseas markets as another BU / state. 7. Rely excessively on an overseas
  30. 30. If you’re really serious about having an impact and delivering a great return for yourself & investors, you have the obligation to build a global company.
  31. 31.