July 9-10, 2013
San Francisco, CA

Tickets On Sale Now

The US is a global leader in Internet and smartphone penetration and use, but the rest of the world is catching up fast.  With a good part of the growth for consumer products happening abroad, the question isn’t if you should go global with your startup, but how and when.

Europe may be a good place to start — if we combine the top 6 countries in Europe, they have a higher GDP than North America — but as you can see from the growth charts of some popular US tech companies serving international markets, a huge number of users are coming from farther afield.

WordPress.com

Tumblr

LinkedIn.com

The traditional US-first launch has worked for a number of companies, but we’ll be seeing many more global-first startups in the coming months. Just.me is one of the first to do so; it launched with 32 languages and in 155 countries.

My company Betable is global-first. We operate in multiple global markets and are always expanding to more, so I’ve gotten a good inside view of both the risks and rewards of this kind of strategy.

The advantages of going global first are that it lets you:

• Quickly lock up markets
• Unlock unexpected growth in markets you may not have launched in otherwise
• Uncover unexpected use cases of your product
• Run cheaper testing and learning experiments in foreign markets
• Save costs dramatically, compared to a later international expansion
• Avoid local copycats

Regardless of when you’re going global, here are a number of things you should keep in mind:

Not everyone knows English

Internationalization isn’t just the process of translating a website or an app, but this should definitely be the first step. Americans might think that English is understood by mostly everyone in the world, but the reality is that most people in foreign countries don’t speak English and, even if they do, greatly prefer native language applications and websites to English ones.

Fortunately, crowdsourcing tools are making app and website translation much easier and cheaper.

People search on Google in their native language

Adding dedicated local websites doesn’t only improve the experience for users, but actually gets you more of them. People search in their native languages, so without native-language versions of your site or app, all your SEO efforts are going to be completely worthless in foreign markets.

Distribution channels are different

Every country will greatly differ in their performance across the various distribution channels. Don’t assume that Facebook traffic will perform badly on your site abroad because that’s what you’re seeing in the US. When launching in a new market, you should erase almost all your previous thinking about distribution and marketing, start with a new clean slate, and run all the testing from scratch.

Payment methods are different

Credit cards might be ubiquitous in the US and a handful number of European countries, but a large number of Internet users don’t have access to or don’t feel safe using them online. When expanding, keep in mind the prevailing payment methods in each country, which can include carrier billing, local payments, and prepaid options.

Latency matters

It’s no secret that speed matters, and having requests and responses going back and forth around the world takes time. Getting servers all around the world or at least a global CDN to host your static content should be a priority.

Hire international people

Distributed teams or not, having diverse people in your team is mandatory. On top of helping the company being more creative and efficient, you will gain a broader understanding of the ways of life and cultural forces in different parts of the world.

Partner with someone on the ground

Joint ventures are usually a very bad idea, but partnerships are a great way to land in new markets, particularly closed ones such as Germany or China.

If you’re doing consumer Internet or mobile, you need to be thinking about your global strategy. If you’re just starting out, considering going global-first. Chances are you won’t regret it.

Stefano Bernardi is on the founding team of Betable, a VC-funded startup where he heads Customer Development. Previously, he worked in venture capital in Europe. He is a part-time hacker, angel investor, and product advisor, and was selected from more than 300 people to “shadow” Dave McClure at 500 Startups. Check out his blog and follow him on Twitter.

Top photo credit: Shutterstock

July 9-10, 2013
San Francisco, CA

Tickets On Sale Now

After being Amazon.com’s best-selling laptop for 149 days straight, Google is taking its Chromebook show on the road, both internationally and at home.

Today, Google and its hardware partners Acer, HP, and Samsung will begin selling Chromebooks in six new countries: Australia, Canada, France, Germany, Ireland, and the Netherlands. And in the U.S., Chromebooks will now be available at over 1,000 Best Buy stores nationally, which doubles the number of physical stores that Google’s  the-browser-is-the-operating-system laptops are sold in.

International pricing will be roughly similar to the U.S., with Canada getting Chromebooks at $250-330, and $300-350 in Australia. But expect to pay a little more in Europe — in France and Germany, they’ll start at around 300 euros, which is close to $400 U.S.

It’s not exactly $99 education pricing, but it’s still fairly cheap.

Google’s first international expansion with Chromebooks to the UK appears to have been a success. Google reported that Chromebook accounts for more than 10 percent of laptop sales in leading UK electronics retailers Currys and PC World.

Google recently released a high-end touchscreen Chromebook for $1,299, which is not being released internationally, and with HP the biggest Chromebook yet, a 14″ model.

July 9-10, 2013
San Francisco, CA

Tickets On Sale Now

Lyft‘s the mobile app that lets you order a moustache-bearing car in minutes, and it’s now expanding to several new cities, including Seattle and Los Angeles.

The startup is not letting its regulatory troubles get in the way of its growth plans. As we recently reported, the California Public Utilities Commission demanded $20,000 in fines from Lyft and rival ride-sharing services Uber and SideCar.

With its “friendly” drivers and donation-based payment model — as opposed to a set fee — Lyft has spread like wildfire in San Francisco since launching out of beta in August. Lyft is the next evolution of Zimride, the car-pooling service that is popular with college students.

With an outpouring of public support in the wake of these hefty citations, Lyft has the confidence it needs to bring its service to more U.S. cities. Don’t expect immediate changes — cofounder Josh Zimmer reported to TechCrunch that hiring drivers and operations staff takes time, and Lyft won’t roll out to more than one city in January.

Lyft’s growing pool of users received a glowing email from the company’s CEO and a list of job openings in new cities.

It has been an incredible year. Riding together, you’ve found new friends, music, and creative collaborators while exploring every corner of this great city. Thank you for building a passionate community with us in San Francisco!

In 2013, we’re expanding our horizons, bringing the social transportation revolution to cities across the country. That’s where you (or any of your friends) come in – join our team and help us take Lyft to new heights!

Top image // Christina Farr, VentureBeat

July 9-10, 2013
San Francisco, CA

Tickets On Sale Now

After a successful U.S. launch, streaming music service Spotify is now turning its attention to Canada.

Spotify’s recently published annual accounts reveal plans to expand further into the North American continent via the Canadian market, according to a Wall Street Journal report. The annual accounts also mention that Spotify plans to launch its service into Asian and South American markets in the future.

The Stockholm, Sweden-based company’s ultra-popular music service, which allows users to share their playlists with others and discover new music, first gained popularity across Europe before coming to the U.S. last year. More recently, the company launched the service into Australia and New Zealand.

That said, the expansion into Canada is the next logical step for Spotify. The market is very similar to the U.S., which should make marketing and content licensing deals easier to identify. And if Netflix is any indication, Spotify will experience successful growth in under a year.

The service currently has 4 million paying subscribers and over 15 million total active monthly users, according to information the company shared back in July.

Spotify has raised around $188 million in funding, and is reportedly seeking a massive new round that could boost the startup’s valuation upwards of $3.5 billion.

Photo via CBC News

[ updated July 20 with a confirmation from a competitor - see bottom for more details ]

Ahh, LinkedIn we love you.

People can never seem to wait with their profile updates until the public announcement is out. At least, that seems to be the case with Andrew Verbitsky, a former Accenture consultant, venture capitalist, and now Managing Director Russia & CIS for Kayak:

Yes, this Kayak.

The same Kayak that just priced its initial public offering at $23-25 per share, seeking to raise about $100 million. I just checked the company’s S1 filing for going public, and the word “Russia” makes not one single appearance.

Much of the S1 is pure boilerplate, probably including a fairly generic statement about expansion. However, if Kayak is indeed expanding to Russia, this is where the tip-off in the S1 filing would be:

We may also use a portion of the proceeds to expand our current business through acquisitions or investments in other strategic businesses, products or technologies.

In addition, as Quintura noticed, kayak.ru is now forwarding to kayak.com. Previously, the .ru domain had belonged to an actual kayaking club.

An expansion to Russia makes a lot of sense for Kayak, given that the Russian ecommerce market is booming — growing to $40-60 billion by 2020, and is the largest online market in Europe, with 70 million Internet users. Coincidentally, travel industry research firm PhoCusWright (!) just reported that online booking for travel in Eastern Europe and Russia is growing quickly: faster than 25 percent annually for the next two years.

VentureBeat has contacted Kayak PR for details and we will update as they come in.

Verbitsky, meanwhile, has added just one line to the Experience section of his LinkedIn profile that mentions his current job:

“Having great time swimming against the tide.”

[ update - July 20 ]

I received an email from Max Kraynov, who is the Managing Director of JetRadar (aviasales.ru in Russia).

I’ve just read your “Travel deals site Kayak entering Russia just prior to IPO?” article and want to offer a couple of insights if you’re interested.

First of all, I’m the CEO of aviasales.ru (AKA JetRadar in other markets), the key competitor of Kayak, Momondo and Skyscanner. We’re the #1 in Russia, hence, as you can imagine, the topic is quite interesting to me.

Secondly, KAYAK started advertising for an MD position in Russia in Feb-Mar 12. They found Andrey Verbitsky in May. He’s ex-Fast Lane Ventures person, and FLV has a mixed reputation since their model is taking Western startups and adapting them to the Russian realities.

Thirdly, they considered regional acquisitions but chose not to do them. (Won’t tell who they were looking at out of courtesy to KAYAK).

Now the interesting part. So far they haven’t got any contracts with the Russian OTAs and airlines. The ITA software technology is pretty much useless outside the US, hence they would have to build something similar to what we’ve done in Russia. They estimated their time to market to be around 4-5 months, but in reality (unless they make a fast acquisition, and there’s no one for sale on the block) if they want to make a product and not just put a lipstick on a pig, this would take 8-12 months.

Nice effort, though.

Image credit: Nickolay Vinokurov/ShutterStock

Annual Pass holders, the media, fansites, friends and family, and opt-in beta testers will all get a chance to experience the new content during the course of the beta, according to a post on Battle.net. Testing will first focus on the starting levels for the game’s new playable race, the Pandaren.

High-level content, as well as template characters, will become available in future beta updates, Blizzard says. However, players can still copy over high-level characters now if they’d like to test WoW’s new talent system, which will replace the current 41-point talent trees with tiered talents awarded every 15 levels.

Mists of Pandaria is the fourth expansion for the 8-year-old massively multiplayer online role-playing game. It will raise the level cap from 85 to 90 and will introduce the new Monk class along with the new Pandaren race.

Blizzard says there is no Non-Disclosure Agreement for this beta test. Those selected to participate will receive an email invitation with instructions on how to download the beta client directly from their Battle.net account. If you’re interested in getting in, you can visit the Mists of Pandaria Beta Opt-in Announcement and FAQ page.

---

GamesBeat 2013 is our fifth annual conference on disruption in the video game market. You'll get 360-degree perspectives from top gaming executives, developers, and analysts on what’s to come in the industry. Our theme this year is “The Battle Royal.” Check out full event details here, and grab your early-bird tickets here!

---

Sept. 9 - 10, 2013 San Francisco, CA

Early Bird Tickets on Sale

Customer and workforce analytics software company Enkata on Monday announced it has raised a new $4.4 million funding round, with goals of expanding the company and continuing to help improve customer service tools.

“We’re repurposing the industrial engineering techniques from the 1950s and ’60s and applying them to the service industry,” Enkata CEO David Stamm told VentureBeat.

Enkata provides wide-ranging cloud-based software to several Fortune 500 countries to them improve call center management and customer service techniques. The software types include tracking customer calls, claims processing, quality assurance functions, and agent management.

Current high-profile Enkata customers include Sprint, Aetna, Chase, Citibank and United Healthcare. Stamm said these companies have responded especially well to Enkata’s software because customers more often have their problems solved on the first call.

“One of the biggest goals for companies to have the best customer service and rank at the top of JD Power and Associates rankings,” Stamm said. “We make that possible.”

The company’s new $4.4 million round was led by new investor IT Farm Corporation. At first appears that amount appears a little small for a traditional third round of funding, but Stamm, who is also the company’s largest individual investor, said the company chose to keep the amount smaller to cause as little share dilution as possible.

“We could have easily got as much as $15 million for the round if we wanted,” Stamm said. “But this wasn’t a typical venture round. We had very specific goals in mind.”

Redwood City, Calif.-based Enkata last raised $8 million back in February 2008, with Sigma Partners and Apex Venture Partners leading that funding. The company’s funding including the new round now totals $18 million.

Stamm said he also plans to expand the 100-employee company by another 40 jobs in the next 12 months. He said Enkata would soon open an office in the U.K. with a goal of furthering its worldwide reach.

We’ll be exploring the most disruptive cloud trends at our inaugural CloudBeat event on Nov 30-Dec 1 at the Sofitel Hotel in Redwood Shores. We’ll be unveiling some of the most revolutionary cases of cloud adoption by the enterprise. It’s invite only. To apply to come, click on this link.

July 9-10, 2013
San Francisco, CA

Tickets On Sale Now

Streaming video service Hulu is planning to expand its service into Japan, the company announced Wednesday in a blog post.

Its move into Japan marks the young company’s first international expansion effort. Hulu competitor Netflix also recently announced efforts to expand beyond North America and into both Europe and Latin America.

Hulu’s Japanese service, which will be available later this year, is very similar to what’s offered in the U.S. Premium subscribers will have access to a large selection of feature films and popular TV shows on multiple devices (PCs, TVs, mobile phones and tablets) for one monthly fee.

The company said Japan was an attractive market for its streaming service for several reasons, such as the country’s extensive broadband penetration, smartphone and other internet-connected device ubiquity, and strong consumer interest in streaming video.

“Japanese audiences are passionate about premium video content, and the country is a major producer of world-class TV and feature films (Japanese content has played an important part of Hulu’s content lineup in the United States for a long time already),” wrote Hulu Vice President of International Johannes Larcher in a blog post.

Hulu declined to release additional details about the Japanese service, but it’s likely that the overall design will be much different. Hulu was unavailable for further comment about its international expansion efforts.

Hulu also announced that the company has opened new offices in Tokyo.

July 9-10, 2013
San Francisco, CA

Tickets On Sale Now

(Editor’s note: Serial entrepreneur Steve Blank is the author of Four Steps to the Epiphany. This column originally appeared on his blog.)

Sometimes financial decisions that are seemingly rational on their face can precipitate mass exodus of your best engineers.

Last week, as a favor to a friend, I sat in on a board meeting of a fairly successful 3.5 year-old startup. Given all that could go wrong in this economy, they were doing well. Their business had just crossed cash flow breakeven, had grown past 50 employees, just raised a substantive follow-on round of financing and had recently hired a Chief Financial Officer. It was an impressive performance.

Then the new CFO got up to give her presentation – all kind of expected; Sarbanes Oxley compliance, a new accounting system, beef up IT and security, Section 409A (valuation) compliance, etc. Then she dropped the other shoe.

“Do you know how much our company is spending on free sodas and snacks?”  And to answer her own question she presented the spreadsheet totaling it all up.

There were some experienced VC’s in the room and I was waiting for them to “educate” her about startup culture. But my jaw dropped when the board agreed that the “free stuff” had to go.

“We’re too big for that now” was the shared opinion. But we’ll sell them soda “cheap.”

Uh oh

I had lived through this same conversation four times in my career, and each time it ended as an example of unintended consequences. No one on the board or the executive staff was trying to be stupid. But to save $10,000 or so, they unintentionally launched an exodus of their best engineers.

This company had grown from the founders, who hired an early team of superstars, many now managing their own teams. All these engineers were still heads-down, working their tails off, just as they had been doing since the first few months of the company. Too busy working, most were oblivious to the changes that success and growth had brought to the company.

One day the engineering team was clustered in the snack room looking at the soda machine. The sign said, “Soda now 50 cents.”

The uproar began. Engineers started complaining about the price of the soda. Someone noticed that instead of the informal reimbursement system for dinners when they were working late, there was now a formal expense report system. Some had already been irritated when “professional” managers had been hired over their teams with reportedly more stock than the early engineers had. Lots of email was exchanged about “how things were changing for the worse.” A few engineers went to the see the CEO.

The exodus begins

But the damage had been done. The most talented and senior engineers looked up from their desks and noticed the company was no longer the one they loved. It had changed. And not in a way they were happy with.

The best engineers quietly put the word out that they were available, and in less than month the best and the brightest began to drift away.

Startups go through a metamorphosis as they become larger companies. They go from organizations built to learn, discover and iterate, to predominately one that can execute adroitly having found product/market fit.

Humans seem to be hard-wired for numbers of social relationships. These same numbers also define boundaries in growing an organization – get bigger than a certain size and you need a different management system. The military has recognized this for thousands of years as they built command and control hierarchies that matched these numbers.

The engineers focused on building product never noticed when the company had grown into something different than what they first joined.

The sodas were just the wake-up call.

As startups scale into a company, founders and the board need to realize that the most important transitions are not about systems, buildings or hardware. It’s about the company’s most valuable asset – its employees.

Great companies do this well.

July 9-10, 2013
San Francisco, CA

Tickets On Sale Now

At some point in my career, I began to ponder how/why startups morph from agile, “can do” companies to ones that have lost their edge. I didn’t need to look much further than the “new building” debacle I had a hand in.

One of the things you do right in a startup, is you move from one cheap and cramped building to another as you grow, with desks, cubicles and engineers piled cheek to jowl.

One of the signs of success is when you outgrow your last cramped quarters and can afford a “real” building. This happened to us at SuperMac when our sales skyrocketed.

That’s when things went south.

At SuperMac we were excited to finally get out of the crummy tiltup we had occupied since the company emerged from bankruptcy. Now with cash in hand, we wanted to fix everything that seemed broken and annoying about our office environment. We made what seemed to be a series of logical and rational decisions about what to do with our next office building.

• Engineers were packed in cubicles or desks right on top of each other?
  Now every engineer can have their own office.
• We can’t bring customers to this rundown building.
  The new building needs to reflect that we’re a successful and established company.
• The lobby of the last building didn’t “represent” the company in a professional manner.
  Lets “do it right” and have a lobby and reception area that projects a professional image.
• We had used, crummy and uncomfortable furniture.
  Lets get comfortable chairs and great new desks for everyone.  None of this used stuff.
• The last building has stained carpets and walls that haven’t been painted in years.
  Now we can pick out carpets that look good and feel good and we can have clean walls with great artwork and murals.
• We didn’t have enough conference rooms.
  Lets make sure that we have plenty of conference rooms.
• Everyone left the building for lunch.
  We need our own cafeteria so employees don’t have to leave the building.

Once the commitment to fix everything wrong was in place, we were off and running on the design phase. We hired an interior designer and a great facilities person to manage the process. The exec staff started meeting about the design of the new building.

The company decided that now engineers can have their own offices rather than cramped cubes. The staff got involved about what color the carpet and walls are. And there was lots of discussion of what style of furniture is appropriate.

Our exec staff spent time worrying about who had the corner office, and what departments had the “prime” location. (I was great at “office wars.”) There was lots of talk about the importance of natural lighting and maybe we needed our own cafeteria. And even better, marketing got to design the graphics for the lobby and hallway (bright and colorful neon) to better represent the color graphics business we were in.

We kept the board informed, but they didn’t have much to say since business was going so well, and a new building was needed to accommodate the growing company.

This is when things really started to go downhill for SuperMac. The most obvious problem; the time we spent planning the building distracted the company from running the business. But there were three more insidious problems.

1) While offices for everyone sound good on paper, moving everyone out of cubicles destroyed a culture of tight-knit interaction and communication. Individuals within departments were isolated, and the size and scale of the building isolated departments from each other.

2) The new building telegraphed to our employees, “We’ve arrived. We’re no longer a small struggling startup. You can stop working like a startup and start working like a big company.”

3) We started to believe that the new building was a reflection of the company’s (and our own) success. We took our eye off the business. We thought that since we in such a fine building, we were geniuses, and the business would take care of itself.

While our competitors furiously worked on regaining market share, we were arguing about whether the carpets should be wool or nylon.  The result was not pretty.

If this was just a sad story about a single company, it would be interesting, but not instructive.  However, I’ve seen this story repeated time and again, and not just in Silicon Valley. There’s a mindset that says, “By the dint of our hard work, we are “entitled” to a building upgrade and this is our just reward.”  And on an emotional level it makes sense.  But if you are lucky you have a board of directors who have seen this before. (And they’ll take the CEO out for a trip to the woodshed.)

1) An upgraded new building is a premature transition away from a startup culture.

2) It’s a tipping point to a big company culture.

3) This is a culture and values issue worth fighting over.

Letting this happen is a failure of a board. If the management team is thinking they’ve made it, the new building is just symptomatic of a company heading for a crash. It’s a company that’s lost sight of the values that got it there.

Don’t let it happen to you.

Stay hungry, stay lean.

Image by Black.Dots. via Flickr.

Posted in Business ]]> http://venturebeat.com/2009/08/20/entrepreneurs-beware-the-curse-of-the-new-building/feed/ 0 Entrepreneurs: Beware the curse of the new building vbsteveblank office-building