Situation: An early-stage software company is expanding internationally, both offering services to international companies from their Silicon Valley base, and building a presence overseas. What land mines should they avoid? How do you expand internationally?
Advice from the CEOs:
Be more strategic than opportunistic. Europe is very interested in start-ups. Investigate potential locations thoroughly. For example, Luxembourg and Spain are not the most reliable markets or locations for basing a business.
There are already good networks in Europe that you can plug into so that you don’t have to build everything yourself.
There is a European organization called Open Coffee Club that attracts high tech and social media start-ups. You might consider either partnering with them or buying into their network.
You can set up a corporation in Cyprus to leverage tax advantages and build a network covering Europe.
To have geographic reach across Europe, you probably want two locations in Europe and one in Russia. Look at Ireland and Romania.
Many Russian oligarchs have their investments in Cyprus and may provide a source of investment funds.
Investigate the European Investment Fund and their sub-funds like the JEREMIE Holding Fund. This is a large government-funded investment pool focused on technology, innovation and start-ups.
Foreign companies are attracted to the US because we have the right ecosystem for technology development. However, a bridge strategy for European companies who want access to US funding is tricky. The key issue is visas which have limited duration and may be difficult to renew. Also, immigration frowns on foreign business people who visit the US too frequently.
Have you considered helping start-ups build through their early stages – reducing risk of early failure – before helping them come to the US?
Interview with Luosheng Peng, CEO & President, GageIn
Situation: A fast-growing company is working to engage new users on their platform. They are leveraging ease of use, demonstrated ROI, and fit within an existing ecosystem as their levers to attract and engage new users. What have you found effective to attract and engage new users in a new platform or service?
Advice from Luosheng Peng:
The most important factors to attract new users are ease of use and a demonstrable ROI. It is important to address a complex value proposition simply and easily.
You must know, ahead of time, the single most important value for your target user. Your examples must be clearly tied to your target user’s most important need.
Quick, simple, visual and verbal illustrations are effective. For example, we used short and fun videos like Tracker the dog to explain our products.
You must demonstrate a clear ROI and increased productivity. Your ROI must be real if you want to gain users attention – particularly if you want to gain viral levels of attention.
In business intelligence, finding information is not a problem. The challenge is finding the right information, filling the gaps in information from standard sources, and delivering it at the right time. We spent a great deal of development time getting this part of our product right.
To improve understanding of your ROI, engage early adopters and get their feedback on your current features and how to improve your platform. Early adopters are more analytical and passionate than other users. They want to be acknowledged so be responsive to them.
Offer a freemium model so that new users can try you out and test your value proposition. If they like what they experience, offer a low cost limited premium model with incrementally scaled pricing for additional features or functionality.
Manage your ecosystem. Building a new ecosystem takes a lot of effort and expense. Most small ventures will want to compliment or fit into an existing ecosystem.
Existing ecosystems may already be crowded. Small companies have to be able to break through the crowd and be seen. We completed major integrations with Yammer’s Enterprise Social Network and Salesforce.com’s CRM. Your platform will have the most success if you address a gap or unmet need within the existing ecosystem.