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The Three Keys To Getting Global Expansion Right

Sudheesh is the CEO of ThoughtSpot. Prior to joining ThoughtSpot, Sudheesh was president of Nutanix.

It’s hard for a startup to know when is the right time to go global – but it’s all too easy to expand too quickly or into the wrong markets. Almost every company begins its life in a single market, and deciding when and how to expand internationally is a challenge that every successful company must ultimately tackle.

At ThoughtSpot, we’re aware of the vagaries of global expansion. Since I joined the company in 2018, we have completely changed our business model. As you can imagine, international sales teams built on an old business model are not set up for success. We had to take some strategic steps backwards to reassess and restore our global footprint. In some cases, we were pulled from certain areas. In other cases, we’ve expanded or switched to a partner-led strategy. It is an ongoing process, and one that is critical to our ability to achieve our goals as a company.

Through this experience, we have drawn some important lessons on how to do business abroad. Oftentimes, US companies build a product or service tailored to their home market and then decide to expand. This is a recipe for disaster. The key to global success is simple in theory and complex in implementation – to go global, you have to be local. Here are three keys to correcting this:

1. Maintain your inner culture.

As an expanding company, there are certain things you shouldn’t compromise on. One is the unique work culture that makes Silicon Valley startups work. A large part of the culture of innovation in Silicon Valley is based on a lack of hierarchy and a willingness to achieve high goals no matter who you are or how long you have been with.

Silicon Valley itself is a cosmopolitan place with a cosmopolitan culture. It is living proof that blending people from all over the world makes it possible to build superior work cultures, products and organizations. I have lived and worked in many countries, and Silicon Valley’s recklessness and ability to challenge the status quo has made it the heart of the global tech industry.

If you’re a Silicon Valley company, particularly a tech startup, your inner culture can’t be up for debate. You want your leaders and colleagues within the local country to align with your culture, or you risk creating small cultures that would be nearly impossible to undo.

2. Adapt your business practices to local contexts.

What you have to change is all about your market entry strategy. Successful businesses adapt to local customs. Most companies in the United States are aware of the nature of working with startups. They know that as an early customer, they may be risking a technology that holds a lot of promise but may not be all baked in.

In other parts of the world, this leeway does not exist. Overseas customers are more aware of product quality, support plan and roadmap. But be careful what you promise. If you say you’ll give an update in July, it should. Missing key points will erode trust. The way you communicate with your people abroad is an integral part of this equation. In the United States, we’ve built a comfortable culture of saying “no.” In other parts of the world, employees often say “yes” to an unreasonable schedule and then give their best. This results in missed deadlines that are completely avoidable.

When you reach new territory, listen more than you talk. Global communication patterns vary. Your job is to find out if customers are buying into your letter or not. Your ability to sell in certain markets will depend on external channel partners and resellers who can guarantee your product.

Finally, don’t assume that different countries have common values ​​or a common culture just because they speak a similar language. The way you market and your niche should match the specific region.

3. Appointing the right leaders.

As a CEO, it is impossible to have a complete view of your operations abroad. This is why the leaders you hire in the country are so important. They are responsible for leading and allocating work, maintaining your culture, hiring, eliminating favoritism, and maintaining team alignment with your mission. In engineering and product organizations, performance management is particularly critical.

Global representation is an essential part of diversity. If you are the leader of a Silicon Valley startup, there is a good chance that you will start building your team from your own professional network. The first few employees are likely to share common work or academic experience. As you expand, seek different perspectives and experiences to understand the total value of what you are trying to build.

This is especially important when building global teams. Don’t automatically commission an American to lead your overseas expansion. True diversity means diverse life experiences, and global representation is an important part of that. There is also the fact that some people have to work harder than others to get the same opportunities. If you are choosing between an Ivy League graduate and someone who went to a public university in a developing country, consider what it would take for that second person to compete for the same job. Consider how these experiences have shaped their leadership approach. Evaluate the whole person and what they bring to the table.

Final thought: Think beyond sales.

In the past, American companies looked abroad to cut costs or offload back office work. In an ever-shrinking global economy, this is changing rapidly. An entire generation of people all over the world have grown up with an understanding of technology that previous generations could not have imagined. There is tremendous talent all over the world, so take advantage of it.

The widespread adoption of the cloud has changed the way we build businesses offshore. The cloud is a great equalizer because an organization or an individual can use the same set of technology whether they are in Nigeria or New York. With best-in-class technologies available globally, more regions are producing the best talent and experienced leaders. Innovation centers are replacing remote sales teams as a first step into a new territory. Remember: You are not there just to sell. You are there to adopt.

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