TL;DR – Shaheen Javid shares her experience with Rocket Internet and Stuart on scaling startups in global entrepreneurshop ecosystem.
Through my experiences at Rocket Internet and Stuart, I took part to scaling startups globally from one location to 25+ (Rocket’s appetite for growth). I decided to gather my thoughts on how to scale startups globally the right way, based on the successes and failures I experienced on this topic.
Don’t go too fast.
That would be my first advice on this topic. Which can be a bit counter-intuitive, especially coming from a Rocket Internet alumni: when you work for a startup, going fast is very important. You want to be faster than competition. You don’t have a lot of time to prove your model to yourself and to your investors. You need to be able to adjust quickly in case you see there are needs for adjustments — going fast is basically the mantra of startups, the mindset that oppose them to big corporates where there are many more steps, processes and hierarchy levels to go through for any decision.
But still, don’t go too fast to expand in other countries and globally.
First make sure you are doing good in the first city / country you launched.
Make sure you have built the brand and have a good client basis. Make sure you have a well functioning product, that operations are working, and that you have clear processes for all teams. You don’t need to wait 10 years that everything is perfect of course, but like any house or building, you need solid foundations to be able to build on them.
I saw some cases of ventures which started to scale and open up new countries too fast, while they were not even ready to operate in one country. They hired teams on the ground which were doing a great sales job but product and operations could not sustain the additional business. The teams in countries ended up spending all their time doing manual operational processes to handle the new clients they were acquiring, and like all manual processes they became overwhelming and clients started to churn. At the end, the startup had to close down all new countries to focus on the first city where they launched.
Scaling can be amazing for PR — presenting your company as operating in several countries gives you additional legitimacy as a solid global business, which can help in sales pitches for instance. When I was working for Foodora Australia (Rocket Internet) and trying to acquire local Sydney restaurants to our platform, highlighting we were operating in 25 + cities all over the world was for sure helping out getting Australian restaurants interested and adding some credibility.
However, if the client experience is overall bad in all the countries, these are 3, 4, 5 and not only 1 country where your reputation is tarnished.
Build a global company with centralised and decentralised functions
Once you’re ready to scale, make sure to think about how you want to handle the different functions between the headquarter and the operating countries: basically what you centralise and what you decentralise. You will likely keep in headquarters the product and tech teams, online marketing, some customer support and the set up of Sales / Operations / Account Management / all business related processes (tools selection and set up, automatisation, etc).
Teams in the countries should be focused on on-the-ground activities: acquire clients and build relationships with them (more about this in this article), handle offline marketing activities, PR and events. Customer Support should be localised as much as possible as it is essential to the client experience: the agents should of course speak the local langage fluently (seems pretty straightforward but I’ve seen cases where they were not!) and be available at the local operational times. Many Customer support teams are based in the headquarters of the company — if they are in cities that attract a lot of foreign people it is easy to source different citizenships (Barcelona for Stuart). It is good for the Support agents to be sitting all together as a team rather than scattered here and there in different countries (more learning from your peers, team emulation, etc). This is of course possible if you’re not on different time zones — if yes, you will need to have your Customer Support ressources in each countries.
Maintain unity in your global company
It is also important to think about how to maintain a unity in the now global company. If you just have one office, everyone knows each other — it is then easy to learn from each other and build a nice company culture. It is even more important to make sure this stays when you are opening up new cities and countries and when all the team is not in one office anymore.
This is why SpaceWays, the first Rocket Internet venture I worked for, created the position of Global Expansion Manager that I was lucky enough to endorse. I started at SpaceWays Berlin headquarters when it was still a very small startup and got to know all the central team there very well. Then, I was sent to Paris and all the new cities we were opening, to build the brand in the ground, recruit the local teams and build links between them and the central team in Berlin.
When you are operating in Berlin, Toronto, Sydney or Chicago at the same time, as we were, you can’t necessarily have all the country teams come visit the Berlin headquarters — that is why a position of Global Expansion Manager can be a good in between to make sure the local teams still have a good sense of what is the original company culture and feel part of a global group, and not by themselves.
Build a healthy global competition scheme
Competition is a great way to emulate people to push harder. It is good to set up a bit of competition within a company between the different local entities: France vs. UK teams, etc. This is part of some “gamification” tools which can create a “positive exciting” environment.
But don’t push it too hard. It is still one global company, so you don’t want the different country teams to hate each other and stop sharing any best practice and tips out of fear of “losing” against their peers. What you want is the contrary: give a global recognition to the best performing teams, without blaming the worst performing ones. On the contrary, ask them to jump on a call with their peers who are doing better. You shouldn’t even have to ask them: they should proactively do it by themselves, and have regular catchup with their counterparts in the other countries to know what they’re doing, how well it is working and be inspired.
When I was at SpaceWays, we set up some weekly KPIs for all cities: order volumes, clients acquisition, churn, partnerships closed, etc. Each week, all the cities were filling in numbers that we were discussing during a Global call with all the city managers. That was a forum for them to understand why some were over performing or under-performing. When a new city manager was starting with us, one of the first thing I was doing as Global Expansion Manager was to make sure that he/she was jumping on a call / meeting (when possible) with the other city managers to build relationships.
Being in several markets is a real asset to scale your company, bring it to the next level and benchmark what is working and what is not. Really leverage this: compare, benchmark, always in a positive mindset and with the goal to focus on the wins and spread them to the whole company. That is how a global company will win everywhere.
Now go conquer the world!
Shaheen Javid is a startupreneur, Rocket Internet Alumni now rock’n’rolling Stuart Delivery in London.