Coming to America - is it still worth it?

I recently gave a talk in Korea on the topic of what it takes for a startup to be globally successful. ? In preparing for the conference, I interviewed a handful of founders who have either successfully built and exited cross-border companies, or are currently operating cross-border to learn about the benefits and challenges encountered during their journey.???

The key takeaway from those conversations is that any aspiring global founder will sooner or later find themselves pushed into the American market, the better to take advantage of the massive opportunities that can be found here. That can be a real shock for any entrepreneur unused to the United States’ idiosyncratic business culture. The only remedy, those founders tell me, is total immersion.

It may seem scary, but investing the time and effort into living in the United States at least for a while can pay huge dividends. Those who have taken the plunge say it made all the difference for their company.?

“Don’t be scared by the perception of difficulty. The best investment an early stage founder can make is a 1 way ticket to Silicon Valley,” said one founder.

Go where the customers live.

Many founders have started their Enterprise/B2B companies outside of the United States. It inevitably doesn’t take long for these startups to realize that to build a resilient company that lasts, they have to learn how to sell to American customers.? Moreover, they realize that the US customers account for the majority of opportunities for their product category.? Over one third of the approximately $5 trillion global IT market is in the US. We have corporate enterprises here that have annual IT budgets exceeding $5 billion.

The common recipe for success is therefore to plant the product/sales/marketing leadership in the US and technology/delivery teams abroad. Moving to the US has other benefits too, including the opportunity to build a larger network for recruiting and mentorship from the many active tech entrepreneurship communities. Still, many founders are surprised by the very different sales and business culture in the US, even those who may have spent some time in the country before.??

In almost all cases, full immersion is the only path to success.

To be world-class, you need to experience world-class.

Being a founder is a lonely journey. Almost all founders would benefit from a great mentor, if they don’t already have one. The US is undeniably the best place for a tech founder to find a mentor. Silicon Valley is rich in its history and loaded with successful founders who are willing to give their time to “pay it forward” for the next generation. I would argue that this is probably the single most important aspect of what separates the US startup ecosystem from almost any other geography. Many foreign founders enroll in American accelerator programs such as Y Combinator, TechStars, and others to fast track the process to get help.

Separately, American businesses need to compete to survive and win. The US market is a free market that encourages open competition. Technology, therefore, is a strategic asset. In many other countries, the largest companies can be incumbents born of legacy relationships or monopolistic government sponsored entities that stifle competition. IT spending in those places is often viewed as a cost center, not a strategic asset. Startups who tackle those markets first tend not to be globally competitive, as “relationship selling” is generally not a great way to build a high-growth company.? Open competition is much more healthy and exciting than closed or limited markets.

Founders, then, can find an absolutely unrivaled opportunity for ambition and success in the US. International founders who come and spend time find themselves digging deeper, thinking bigger. They feed on the community of other founders and crave being in a collaborative culture.???

Cultural differences abound!???

At the same time, international founders who come to the US need to watch out for certain common pitfalls, as expressed by the founders with whom I’ve spoken.

• Hiring and labor practices are rife with different norms. Performance evaluations and discussions in the US are often nuanced, and cross border managers often have a difficult time relating to their subordinates or understanding their struggles.????
• Open dialog and all-hands “town hall” meetings are common in the US. In some countries no one would dare speak up in front of their peers, or see the type of internal corporate data – sales figures, product schedules – openly discussed.
• Language barriers make it easy for employees to form siloed communities, leading to friction..? One company got rid of dual-language Slack channels and forced English to be the only default. Initially there was resistance, but eventually they found tighter synergies across the team..
• The pace of business is a difficult adjustment. ? Things move way faster in the US than anywhere else.??
• Hiring the first US employees can be very challenging for foreign founders.???

Culture stops being a liability and starts becoming a major benefit.??

On the other hand, those same founders say that the investment in becoming a truly global company has its benefits. For every hurdle in adjusting to the American business culture, it pays dividends later

• Having global talent is a big benefit in recruiting and retaining good talent, and more cost effective, to boot. Recruiting from around the world ensures engineering quality stays consistent across the organization.?
• It brings more diversity to the organization, which historically leads to better outcomes.
• A truly global business will have a distributed and diversified revenue base.
• The earlier you are to globalization, the better you’ll become at collaboration – especially prudent as remote work becomes more common.?

Take the plunge

There are no shortcuts here. Founders who want to learn the ins and outs of American business culture need to commit to not just visiting Disneyland and being a tourist, but really fully immersing themselves in this part of the world. Those who went through with it say that it’s been a powerful learning experience that’s informed their whole entrepreneurial journey.

“Looking back, I would not have started the business in my local country – I would have started in the US from day 1.”