Many entrepreneurs dream about expanding their startups into the United States. However, just like any ambitious goal, the expansion must be approached carefully and be thoroughly thought-out.
Over the last three years, more than seventy startups from Eastern Europe have entered the US market through Starta Accelerator. Most startups entering this market face similar problems that could be solved with several simple tricks. I would like to share seven of them that could be helpful to any entrepreneur thinking of expanding into the US market.
First, determine the location: go to Silicon Valley only if you know exactly why
Every tech entrepreneur has a “Silicon Valley dream”: in my experience, almost every entrepreneur plans to begin expansion into the US market from the Valley. However, one needs to understand that moving there is not a golden ticket to a bright future for your company. Nowadays, Silicon Valley is overloaded with fundraising startups, and not every one of them will be noticed. If you want to reach a particular client or investor based in San Francisco, only then should you consider moving there. In fact, it’s easier to enter the US market, for example, from New York: here, the competition is lower, with ample investors to be found.
Get the support of a lawyer or accelerator to help you in the first stage
Moving to the US is a difficult and resource-intensive task: simply buying a one-way ticket won’t cut it. Problems could arise as early as the stage of obtaining a visa. Furthermore, your legal challenges only start here. You need to register your business in a new country, making sure it complies with every law so as not cause any future issues with investors. In addition, essential things such as renting an apartment without a credit history, getting an American credit card, and opening a business bank account, are all tiresome tasks that take time to complete and cannot be resolved at the drop of a hat. Overall, there are a lot of nuances, which could be hard to navigate without a deep understanding of local laws and regulations.
All these problems, of course, could be solved — but your life would be much easier if you have a reliable expert to guide you, such as a local lawyer. Additionally, a good acceleration program could become a great platform when entering a new market. Such acceleration programs not only help with relocation, but also invest money to start a business — typically in exchange for equity.
For example, Starta Accelerator provides coaches for every step of setting up and operating a business. Hiring such coaches on your own could result in yearly expenses of $100–120K — this is an average wage of an experienced specialist in the US market today.
Learn how to sell: having a great product with no sales doesn’t do much
Most entrepreneurs from former USSR republics and Russia have one common shortcoming: they are excellent techies and great inventors, but they have no skills in sales and business development. On the contrary, Americans are especially good at selling. Therefore, in the US market, you would either have to learn perseverance and more aggressive sales (and not retreat after the words “no, I do not need your widget”), or look for local specialists to add to your team (but I already warned you about the high level of salaries in the market).
Stop blaming others for your failures
You have been crafting your product and, finally, you are ready to show your masterpiece to the world! You came to the new market with no doubts that your project is going to solve all problems of your potential customers — but, surprisingly, you receive negative feedback that your project, in which you put so much effort, got everything wrong, from your target audience to the product’s functionality. This is unpleasant, but with a high probability, people who tell you this — if they are experts from an accelerator or your potential customers — are right. In such a situation, there is a great temptation to close down and say that everyone around is mistaken and does not understand anything. But this is the direct way to failure. Therefore, it is important to be open to any constructive feedback, not be defensive over criticism, and maximize the opportunity to communicate with your client directly.
Take off your crown and admit that you know nothing about this market
A lot of Russian entrepreneurs, if they have already attained traction at home, let their success go to their heads. This is quite natural: they have managed to transform their idea into a working business with decent turnover and steady cash flow. They did something that not every entrepreneur, even on the local level, is able to accomplish. However, the US market is quite different. It is super-competitive: businessmen from countries like India, China, Indonesia, and Europe come here chasing their dreams. You have to compete not only with several compatriots, but with the whole world.
Therefore, your heightened self-esteem should be thrown away on the way to the airport: be prepared for the fact that you, as at the very start, have to go out into the field, re-learn to sell, and most importantly, recognize that you do not know anything about the market or the customers. In my experience, this ability to be humble — to get out of one’s comfort zone and quickly realize that absolutely everything has to be re-learned from scratch — is the key for an entrepreneur to be successful in the US market.
Build up your customer base
Before you enter the US market, your company needs at least some confirmation that its product is in demand by the market. That is, before moving, you should accumulate at least a minimal threshold — client base or money coming to the company’s account from customers. In addition, your product should be global: if you came up with a Polish analogue of Uber, it does not make sense to introduce it to the US market.
Learn English and get ready for stress
In the United States, you have to talk a lot. You should be ready not just for small talk but also to be able to spark interest in the conversation with literally every person you meet — you never know which of them may become your investor. In my experience, any level of language proficiency lower than upper-intermediate will not be enough for active networking.
In addition, moving, new working conditions, great competition — all these are tremendous stressors that will pile on you from the very first day. In order to avoid feeling overwhelmed, it is better to realistically assess your strengths and capabilities in advance. If you are ready to fight, not give up no matter how difficult the situation seems, learn from your mistakes, and be persistent — then definitely give it a try.