— Kim Pham (@kim617) June 24, 2015
So Kim, I’m guessing you did it because many of the companies you invest in are experiencing these problems? Any other reasons as well?
Many of our early-stage companies are eyeing US expansion within 12 months of us investing, so these various issues kept coming up time and time again. Despite being companies of different sectors and stages, they struggled and wasted time on the same things, as this journey will be fairly similar for early-stage tech startups.
I wanted to create a useful (if not meaty) resource for our founders – something that they could carry with them at all stages of the expansion. It took a lot of work for Frontline to put together, but it is something tangibly helpful – hopefully saving our companies weeks of time spent researching and learning all of this individually.
What has the response been?
It’s been overwhelmingly positive! I knew from the beginning that the Playbook wouldn’t be a “sexy” read – it’s quite long, dry, and technical. Your average startup enthusiast wouldn’t be interested in 60% of the content, so we thought that while readership numbers would be lower than average, it would be really helpful to those that the Playbook is relevant too.
The reception has far exceeded our expectations – founders from all around the world have tweeted and emailed their thanks and appreciation. It’s incredibly rewarding and humbling to hear that my past 4 months of work is helping time- and cash-strapped founders get their venture to the US. There have even been some requests for the same playbook to be made for India and China!
Any requests for additional information / changes you’d make if you were doing it again?
There will be small revisions in the future, but nothing drastic. Aside from regulatory or legislative changes, most of the information isn’t time sensitive and will continue to stay relevant for international founders.
The book is very good at outlining the practical challenges faced in ‘breaking’ America. Visas and state by state taxes especially can be a real challenge. Do you find that intentionally or unintentionally it is harder than it need be to set up in the US?
As an American, it’s something that I grew up with and never had to think about. But when forced to take a look at the system from the outside, it has become clear to me how exceptionally complex and expensive it is for an international founder to go through this process. The US government and system can be very unfriendly to bright, talented folks — simply because they were born elsewhere. It is a privilege that I am humbled to be reminded of as I created this Playbook.
You give the example of Shake.io staying for 6 weeks rather than 1, to allow for follow up meetings. Would this be a common experience of needing a lot more money / burn time than you think to try and make useful connections in the US?
I think a lot of founders underestimate how much face time they will need to put into the Valley, NYC, or Boston to build a large and meaningful network. What Kevin and the Shake team discovered is that there’s oftentimes a knock-on effect in your first meetings – one new connection will lead to another, etc. etc. 1-2 week stays can quickly turn into 5-6 weeks because you need to capitalise on that momentum when establishing your network.
As you mention, twitter and other social media give a great opportunity to build connections before even leaving Europe. Would you say some aspiring startups could do more in this area to build relationships prior to leaving for the US?
Absolutely. If the US is your end goal, it should be the CEO’s job to entrench him/herself in the ecosystem – even prior to getting on the plane. They should be following all the local VCs, tech journalists, industry experts, other founders, etc. and engaging in the conversation, even from across the Atlantic. The Internet has reduced the distance between yourself and the men and women who had large exits in your sector, write checks into similar companies, and are the thought leaders in your field. Leverage the power of social media to make yourself a part of their landscape.
With all of the potential expenses / challenges, do you sometimes advise some startups to hold off going to the States, or is it still better to get over there and get their feet wet?
Timing is a tricky thing – there is no “one size fits all” here. For some companies (particularly consumer), the sooner they can hit the ground and crack the American market, the better. For others, it makes sense to build out a team and achieve traction in the home market before turning on the US machine. As founders figure out product-market fit, the data will tell them when timing is best.
— Frontline Ventures (@Frontline) June 24, 2015
Anything else you’d like to add?
I’d just like to give a huge thanks to the many founders, investors, and service providers who sat down with me and talked through their experiences of setting up in the US. It is these incredible men and women whose journeys I hope to celebrate in the US Playbook! If you’re interested in reading more Frontline startup resources, subscribe here.
Kim with the rest of the Frontline Ventures team