The biggest dream for a tech startup founder is to make it to the Silicon Valley. Hundreds of European startup founders move to the Valley, every year. But once you get there, what’s the next step? The super competitive Silicon Valley is filled with the best talents and startups, where all are competing with each other to score the best spot.
Those who were the big fish of the small ponds, suddenly find themselves in an ocean full of bigger fishes. In such a cut-throat competition scenario, instead of getting disheartened, one should accept the situation positively as a challenge and succeed by working hard but smart.
In an exclusive conversation with Silicon Canals, Eric Thelen, Director, EIT Digital Silicon Valley Hub shares his expert views and his perspective on how to make it a success in the Valley. Below are some tips by the connoisseur on how to become the next big thing in the Silicon Valley. Take a look at it below.
#1 Be realistic! Avoid overestimating an opportunity
One should avoid making the most common mistake of overestimating an opportunity, just because you got a positive feedback. As per the expert, people in the Silicon Valley are naturally optimistic, opportunity-oriented and do not tend to be critical. They’re open-minded and are always looking for the next best interesting deal. But at the same time, they’re aware of the fact that they may not succeed, if the project doesn’t look extremely attractive.
Hence, never be over-confident based on their expressions, rather be realistic. In order to close a deal, one should be truly convincing to build the trust.
Eric Thelen says, “It can go faster in Silicon Valley, but it does not require less effort than elsewhere. Less experienced companies may constantly think that they are close to scoring a deal due to positive feedback and expressions of interest, while they might realistically still be rather far away from realizing revenue or investment.”
#2 Invest! Invest! Invest!
Another costly mistake in the Silicon Valley, is if a startup doesn’t invest a lot and in the right areas! Investment can be in terms of cash flow, time and human resource. It is very important to keep up with the super-competitive environment in the US.
Eric Thelen adds, “In Silicon Valley, companies need to invest as much time and human resources as elsewhere. They need to be present (either permanently or via a combination of multiple longer trips). At the same time, companies should be aware that their first step in the US market require a significant investment to compete with the local startup brands.”
On asking how much investment a startup should expect when moving, Mr. Thelen estimates, “The expected investment depends on what the company intends to do and what is the value propositions of the startup. In order to provide a ballpark number, just as an extremely rough indication, we sometimes mention € 100K as a commitment that the company should at least be willing to invest in seriously approaching the US market.”
He also adds, “European companies also needs to convince customers that they are sufficiently stable to engage in a long-term relationship, which is initially a risk for the US customers, as they never know, due to lack of investments a company might discontinue its operations.”
“Other expenses like legal services, office space and more are also to be considered, especially if a startup is planning to establish a permanent presence, to increase the chances of success,” Mr. Thelen concludes.
#3 Stay focused on your key goal. Make adjustments, if required!
In order to succeed the startup founders should know what they want to accomplish and stay focused without being distracted. Also, they should be ready to make adjustments, instead of being arrogant or rigid. Meanwhile, they should also know which opportunity to bank on, out of all the large number of possibilities that are present in the Silicon Valley. It’s advisable not to run after each and every opportunity. Working on too many prospects simultaneously can result in failure and waste of effort.
“If they select the wrong opportunities, they will end up with a lower success rate. Companies should constantly work on the choices they make and be ready to make adjustments,” opines Eric Thelen.
He also notes, “One should ensure personal presence, the ideal would be permanently, but at least at regular intervals. Scouting trips can be considered to launch the main initiative.”
#4 Obtaining local support is very important!
Reach out to other local partners, service providers, experts, mentors, people who are somewhat related to yours and have comparable traction. Further, try to establish a relationship with them so that once you make the big move, you already have a network of great people.
Eric Thelen adds, “For European companies, EIT Digital can be one of them. Obtain as much support and input as possible, while taking your big decisions, also you can take feedback on your Silicon Valley Readiness.” (EIT Digital has a “Silicon Valley Readiness Assessment”, which is applied by the organization a scaleup that is looking for support for Access-to-Market in the US.)
#5 Networking – a continuous activity in Silicon Valley
While it’s not so difficult but it takes time to build a network, establish legitimacy and understand the finer but important nuances that will be involved in the transition. “Networking is a continuous activity in the Silicon Valley, which is very much part of the Valley culture. People are generally willing to make new connections and help their connections by offering access to their network,” opines Eric Thelen.
One should observe and learn a lot during networking. While there are cultural and hierarchical differences in the Valley, they do not matter as much since people tend to be very accessible. One should look out for founders who have moved to the US from Europe or the Benelux region and start building a relationship with them. Attend events, conferences, etc., where there might be an opportunity to interact with new people and to exchange contact information.
“The principle of reciprocity is well-established in Silicon Valley. In order to be a successful networker, newcomers should be aware that if they are helped by others, they should be ready to assist them, when the opportunity arises. If they only obtain help and do not add any value to their network, they will not succeed in further growing it,” suggests Eric Thelen.
#6 Leverage your references
It’s always good to leverage your references from Europe, be it in any form including reference customers, investors, partners, prizes, team members with extraordinary credentials or more. A reference call or a remark undoubtedly adds to the integrity of the company.
On asking what would be the best advice for the Europeans startups planning a move to Silicon Valley, Eric Thelen says, “A reference is very important. Anything you can do to increase your credibility, an impression of stability and to establish trust with your Silicon Valley business partners will significantly increase your chances of success.”
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