Startups Gone GLOBAL!(What a #ShitShow)

@DaveMcClure @500StartupsPioneers FestivalVienna, Oct 2012

This Talk Is About…(Pro Tip: Leave Now B4 This Gets Ugly)

• 500 Startups– Internet Seed Fund + Accelerator + >100 Intl Startups

• Assessing Global Markets– (# users, by language/geo) * (avg $ GDP) * (% internet) = avail online spend by lang/geo

• Why You Shouldn’t Go Global– You’re a Crappy Little Startup with no customers, revenue, or funding– You Don’t Speak the Language (not very well, anyway)– Your local market is >50M+ users, and nobody else is going after it

• Why You Should Go Global – You Live in a Small Country / Startup Ghetto– There aren’t any local market investors worth a famn.– There ARE local market investors, but they might be predatory, revenue-focused a-holes– Your customers and partners are in [X] (where X = California, NYC, London, Beijing, Brazil, etc

Dave McClureFounding Partner & Sith Lord, 500 Startups

00’s & 10’s:• Investor: Founders Fund, Facebook fbFund, 500 Startups• Companies: Mint.com, SlideShare, Twilio, WildFire, SendGrid• Marketing: PayPal, Simply Hired, Mint.com, O’Reilly

80’s & 90’s:• Entrepreneur: Founder/CEO Aslan Computing (acq’d)• Developer: Windows / SQL DB consultant (Intel, MSFT)• Engineer: Johns Hopkins‘88, BS Eng / Applied Math

500 StartupsMountain View, CA – Founded 2010

• Seed Fund & Startup Accelerator– $50M under management– 16 people / 8 investing partners– 10,000 sq ft / Silicon Valley HQ– SF, NY, MEX, BRZ, IND (+ more)– 700 Founders / 200 Mentors– Focus: Design, Data, Distribution

• 400+ Co’s / 100 Intl / 20+ Countries– Wildfire (acq GOOG, $350M)– Twilio– SendGrid– TaskRabbit– MakerBot– Viki– 9GAG

GeeksOnaPlane.com (my excuse for an Intl road trip w/ geeky friends)

• Travel The World with Geeks & VCs• Meet MORE Geeks & VCs in other countries• Learn about Intl markets, technology, people• Get drunk & eat great food with friends who

don’t speak your language

• East Asia (3x), Europe (2x), LatAm (2x), India• Next: Middle East, India, SE Asia, Africa

Global Languages

• English: 1-2B+ ppl, most online, high GDP, modest growth• Mandarin: 1B+ ppl, lots online, med GDP, flat growth• Spanish: 500M+ ppl, some online, med GDP, strong growth• Arabic: 500M+ ppl, some online, low/med GDP, strong growth

• Others: Hindi, Portuguese, French, German, Japanese, Russian, Korean, etc

Global Markets• US/Can/UK/AU (400M+): big market, not much growth but lots of spend• Europe (400-500M): not much growth, many lang, high GDP• China / E. Asia (1B+): lots of ppl, growing usage / GDP, flat growth (pop.)• LatAm (500M+): Brazil, Mexico, Argentina, Colombia, Chile; LOTS growth• India/Pak/South Asia (1.5B+): lots of ppl, growing mobile, strong growth• SE Asia (600M+): Indonesia, Vietnam, Thailand, Philippines; strong growth• Middle East / Arabic (500M+): growing mobile, lots of future growth• Africa (700M+): growing infrastructure, lots of future growth

How to Assess Global Markets• 1) # of ppl / language speakers by geography• 2) % internet usage (web, mobile, smartphone, etc)• 3) $ Avg GDP / $ online spend / disposable income• Online spend / lang, geo = (#ppl) * (%internet) * ($GDP)

– % Growth rates of ppl, lang, internet, GDP

• Currency, country, culture, etc• Online distrib’tn platforms (search, social, mobile, video, etc)• Online payment methods / credit card distr• Physical goods delivery / logistics• Social media usage / behavior• 3 markets in 1: rich, middle-class, internet poor

Distribution PlatformsCustomer Reach: 100M+

• Search: Google (also Baidu, Yandex, Yahoo-J)

• Social: Facebook, Twitter (also TenCent, Sina, vKontakte)

• Mobile: Apple (iPhone, iPad), Android

• Media: YouTube (Video), Blogs, Photos, Music

• Comm: Email, IM/Chat, SMS, Voice

Why You SHOULD NOTGo Global

cause ur a shitty little startup, u don’t speak the language,

& ur local market is plenty big enough

Why Stay Local? Cuz Ur an Idiot.

• You don’t speak English (well enough).• Your solution won’t travel well / you won’t localize it well.• There’s not as many people competing locally.• Your local market has 50M+ users.• You have customers / revenue.• You have great living situation, family, kids, etc

Why You SHOULDGo Global

Because u live in a ghetto little country, all the local investors are a-holes,

who don’t write checks and/or give u shitty low valuations.

Why Go Global / US / China?(bcz California is fucking *awesome*)

• It’s BIG. (US, China are huge markets)• All the [rich, online] customers are here.• All the investors are here (Silicon Valley)

– also: Local Investors Screw You / Don’t Invest / Low Val$

• All the platforms & partners are here (Silicon Valley).– NorCal: Google, Facebook, Twitter, Apple, Android, YouTube

• Because you watch too many goddam action movies and listen to too much rap.

• Because you love California / NYC. (hey, we understand )

Angel* List: It Rocks.(Use it, You Idiot: angel.co)

• Startups & Investors• Activity & Metrics• Platform & APIs

• *ps – not just for Angels,not just for USA