“Doing Business in the USA” - A Tale of Two Cities
Doing Business in the USA was a highlight of SXSW Interactive, demystifying what’s involved and letting digital entrepreneurs connect in the grand arena of Austin City Hall.
A welcome from Mayor Leffingwell (@TheLeeTeam - yes, he's on Twitter) started the day, with the Brits thanked for bringing the rain with them.
A very healthy - perhaps even heated - debate followed, on exactly which US location is the best place to start. The panel of @scobleizer, @harper, @manoushz and @dotben made their choices, shepherded by chair Hermione Way (@hermioneway).
Robert argued for the dynamic, tech-lead environment of Silicon Valley, while Manoush pointed out that New York represents an agency-rich, brand-driven place to be (you can see her slides on @slideshare). It lacks the dork factor, she said, and talent is challenging, but NYC is now the nation’s second largest tech centre.
But there is plenty going off in the second tier cities and beyond. Ben Metcalfe (@dotben) might be a British-born, Silicon Valley resident, but his latest venture, WP Engine, is based in Austin because of the infrastructure and comparative lack of competition for staff. Where's best place for your business? You'll need to balance workforce skills, access to customers, local culture and funding availability too.
Then the cops walked in.
Not literally, but the legal aspects of trade and employment in the US were covered by Rooney PC.
Compliance with a complex set of federal and state legislation is critical, they made clear, when setting up, doing business or even making that first hire. Get it wrong, and there can be serious consequences. Law is big business in the US: one start-up pointed out that their Professional Indemnity costs in the US were four times the rest of the world combined.
Before setting off, check the US Patent and Trademark Office Database, which is publicly available - to make sure that for your name isn't already in use.
The visa situation for getting staff into the US remains challenging, but it is surmountable with the right help. An interesting note from the session is that there are, finally, signs of reform on the horizon, which may make it more friendly for entrepreneurs.
Enough of the paperwork, on to the marketing and selling.
The "shifting units and making noise" panel handed out some top sales advice:
- "Don't be afraid to go to the top"
- "Don't be afraid to ask for a decision"
- "Be as clear as possible"
Europeans can be a bit 'softly, softly' about closing business, but this is the land of ABCs - Always Be Selling (no, I've never got that one either). The panel included Toby Daniels, Gemma Craven, and Todd Greene VP of Marketing at Media Temple, who were quick to point out some of the differences in cultural customs. We are happy to have a glass of wine with lunch; In the US, that can raise an eyebrow. It takes really hard work to raise awareness and visibility in a new market, especially one as large as the US. Toby's advice: "Establish yourself in the right market before you move into the next."
Funding is a common reason for looking to the US, and the "Show Me The Money" session featured an all-star cast of investors.
Things have definitely moved on in the last few years, with US investors much more open to engaging with international businesses. Ned Hill (DFJ Mercury), Jason Seats (TechStars), Ben Metcalfe (@dotBen) and David Rose (Rose Tech Ventures) ran through the differences in funding models, outlining the pros and cons of angels versus VCs, and the increasing role of incubators and accelerators.
American investment is much more specialist. It's not just about raising money, it's about raising money from people who have expertise. They'll want you to demonstrate customer understanding, most likely expect you to have a complete team, or at least enough of the team to reach the next milestone.
The day was rounded of with some "tales from the trenches" - stories from UK businesses that have "been there" and "done that" - featuring Jules Ehrhardt (ustwo), Dragos Ilinca (UberVU), Jess Butcher (Blippar), and Joe Braidwood (Swiftkey).
International businesses are getting a lot more attention in the States - witnessed by the fact that CNN were in the room during the day, interviewing people.
And there were drinks and networking afterwards - it was SXSW after all.