Founding a global startup...

Summary:The best strategy for a startup is to take a global approach from the very beginning...

Today, if I were founding a startup, I would take a global approach from the very beginning.

Startup culture seems universal these days. This year I've visited startups in the UK and more recently, in France. And I constantly meet startups in Silicon Valley, some have relocated from many other countries.

They all share many things in common: smart, passionate people with lots of great ideas and business strategies. It almost seems as if 'geek' has become the new lingua franca of startups the world over.

Today, I believe that a hybrid strategy is best. The following is based on some of the conversations I've had this year and over the past few years with startups from many countries.

[Please note: The following advice depends upon the type of startup and is not intended to apply to all types of companies.]

The New Rules Global Startup:

- Diversity is very important, make sure you have people from many different countries, cultures and a diversity of experiences.

- Site your research and development in France and take advantage of the 50 per cent R&D tax credit.

- Cities such as Paris offer very good incubator centers where you can find cheap office space (500 Euros per month) with included support services such as meeting rooms, broadband, telephones, common workshops.

- Cambridge in the UK is a great place to recruit smart engineers and with a fantastic culture of innovation that stretches back hundreds of years.

- Put your CEO and CMO in San Francisco/Silicon Valley area. This provides close access to capital for expansion. VCs don't like to travel. Also, this is where much of the media that covers tech and startups has become concentrated.

There are also lots of events and conferences that will save a fortune on travel costs. Plus, your top executives get to practice their English language skills if they don't yet have them. English is the international language of commerce and that won't change in a hurry, even in China executives are learning English.

- Make sure your marketing and sales departments are located in the US. The amount of effort you put into expanding your business in your home country goes much, much further if you do it in the US first.

Plus, success even of the smallest kind in the US, is multiplied in perception in your home country (and in other countries). Just as Frank Sinatra sang about making it in New York, you can then make it anywhere.

- Have people in key urban areas such as San Francisco, Santa Monica, New York, London, Paris, and Berlin. Businesses need to understand the culture in which they want to be successful. If they aren't in it they won't know it. Cities are also where emergent cultures can first be spotted.

- Have software engineering work done in low cost regions such as Bangalore, Manila, etc. Even better, choose regions such as Krakow, where there is high quality and low turnover. Some development teams in regions such as Bangalore and Pune can be 100 per cent a year, while in places such as Krakow, turnover is around 5 per cent a year. High turnover means longer time to market, which can be fatal to a startup.

- Use as much open software technologies as possible, wherever they make sense.

- Use independent contractors as much as possible, again, where applicable. We live in an increasingly atomic society, whether we like it or not.

- Make use of social media, blogging etc, as much as possible and encourage your staff, wherever they are, to be mini-media brands. You should know where your customers and potential customers are online and offline and they should know you.

Everyone in your company should be an evangelist. If they are uncomfortable in that position maybe they should be in a different position.

- Try to build up as much of the company without resorting to VC investments. You'll raise your valuation. And you can focus on making money from your market rather than being constantly distracted by having to raise capital at regular intervals.

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I'll be adding more rules for the Global Startup over the coming weeks. If you have some suggestions please let me know in comments or email.

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Please see:

Paris Diary: Cultural Barriers To French Startups...

Paris Diary: Putting "French" Back Into Entrepreneur

Innovation And Culture - Reflections On My UK Trip

UK Diary: Friday - Cambridge Startups

UK Diary: Thursday - A Visit To Accell Partners - UK Is Tough On Startups

UK Diary: Tuesday - Seed Camp's Highflyers


Topics: Enterprise Software, CXO

About

In May 2004, Tom Foremski became the first journalist to leave a major newspaper, the Financial Times, to make a living as a full-time journalist blogger. He writes the popular news blog Silicon Valley Watcher--reporting on the business of Silicon Valley.Tom arrived in San Francisco in 1984, and has covered US technology markets for leadi... Full Bio

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