Building a startup is tough, whether in San Francisco, Rio de Janeiro or post-Brexit London.
It gets far more complex when that growth includes scaling the company internationally.
Managing growing pains is compounded by distance, language, culture and the unfamiliar.
Most startups aren’t mature enough to take on such challenges. They also have limited funds, people and bandwidth.Getting international growth right is often a process of iteration with no exact recipe to follow. However, there are common mistakes that can be avoided.
Underinvesting in New Markets to Control Costs
Solution: Fully commit to a well-funded plan and stick to it until proof points are clear.
When entering a new market, it is important to collect enough proof points to evaluate true market potential and understand what success looks like. It’s a complex process that takes time and has many unknowns. False starts and setbacks are likely to happen.
Early on it is hard to tell whether these are the result of fundamental challenges in the local market, or an approach that just needs fine-tuning. Putting in the right level of investment and commitment provides enough time to figure out the answer.
Underinvesting may lead to inadequate data points or incorrect conclusions, undermining the chances of success.
Depending on a Single Local Market Leader
Solution: Build a team of high-quality local talent with shared responsibility, complementary skills and talent profiles that are easier to fill.
Relying solely on one individual to crack a local market is precarious, no matter the person’s stature, prior experience, and success in that market. It is very hard to find such a person, and even harder to convince her or him to take a chance on a mostly unknown entity.
Even then, she or he will be remote, building a team from scratch, knowing little about the product and going after a completely new market. That’s a tall order for anyone, and it makes that desired profile practically impossible to hire for.
While this approach can prove successful in one market, it’s hardly a repeatable play. In fact, an international growth plan that relies on finding such a person in every new market is mostly wishful thinking. It also leads to frequent personnel changes and restarts, which can derail the whole plan.
It is much more effective to build a local team of people that form a critical mass, and have profiles that are easier to hire for. The team should include people with complementary skills and personalities that collectively can cover all local market needs.
Each team member should have clearly defined roles and responsibilities to avoid potential conflicts and enable a shared responsibility of success. The added benefit is that this approach inherently establishes continuity internally and with customers, even if one or two people leave.
Failing to Customize for Each Local Market
Solution: Adjust to the realities of the local markets, without compromising the core of what the company does.
It is true that every market is different, sometimes wildly so. There are different market realities, competition, business culture, ethics, buying behaviors, customer needs and the list goes on.
Those realities absolutely do need to be factored in, but an overly custom approach for every market leads to a loss of cohesion and direction within the company. The product team starts getting pulled in all directions, executive focus strays, people in the company stop speaking the same language and successes cannot be leveraged across borders.
Instead, what’s needed are frequent reviews and agreement on how far the product can stretch to accommodate local market needs, without compromising the core product vision and direction. An additional way to address this is by establishing a global delivery playbook that will serve as a guide for all markets, while allowing for some flexibility to adjust to local needs.
Failing to Scale Internal Communications to Match International Growth
Solution: Establish a regimented communication plan that makes remote teams feel part of the company and its success.
Early on in the life of a startup, it is fairly easy to keep everyone abreast of company developments and direction, as the team is small and mostly in one or two locations. However, international growth creates a big communication challenge, which can be overlooked given all other challenges a growing company is faced with.
This leads to remote teams becoming disconnected from the company and its goals. To address the issue, the company needs to establish a rigorous global communication plan that reaches every single employee and makes them feel part of the team.
Such a plan requires discipline and commitment from the top to ensure information is disseminated in a timely fashion, and through a variety of channels. It also requires that key executives visit remote locations frequently to deliver important messages face-to-face and hear feedback in person.
Assuming Company Culture Will Organically Flow to All Locations
Solution: Establish core values that transcend borders and shape company culture worldwide.
Early on in the life of a startup, company culture is inherently defined by the personality of the founder(s) and the small team around them.
The whole team being in one or two locations makes it easy for new people to quickly assimilate. However, as the team grows internationally, that’s no longer possible. There needs to be a concerted effort to define and engender company culture in a way that transcends borders, yet doesn’t alter the company’s DNA.
Establishing a set of core values that take into consideration both where the company came from and where it’s going is absolutely critical.
Creating a Global Company
Successfully scaling an international startup is no small feat. It requires acute awareness of cultural differences across the globe and ability to adjust to them.
At the same time, it requires steadfast adherence to the core values and strengths of the company. Ultimately, though, it requires a commitment to building a truly global company based on sustainable, long term, global growth.
Title image by Avnish Choudhary