Today, any ambitious IT company has a dream get into and establish in the U.S. market as it offers unlimited opportunities. Though it is the most competitive market in the world, Russian company SDVentures managed both conquer its own niche and become international holding. Its secret formula is to foresee users’ expectations and carry them out better than competitors.
In a conversation with Dmitry Volkov, SDVentures founder, we found out the way company achieved its recognition in one of the biggest IT markets in the world.
Tell us, please, how do you think why exactly Americans created Silicon Valley?
Silicon Valley’s success as a tech phenomenon – companies in the Valley get one third of all risk capital investments in the U.S. – in many ways is very similar to the success of the U.S. itself. There has been many preconditions promoting the establishment of the Valley, starting with closeness to Stanford University, hipster movement in California and many great investment funds, ending with great weather conditions. But the most important reason was the fact that very talented innovators from all over the world started arriving in Silicon Valley. Newcomers were the ones who became the main Valley’s driving force. More than 50% startups were created by the first wave of newcomers – the ones who arrived to California with such goal from all over the world.
When you realized you are ready to enter America? Had you already experienced any foreign projects by that time?
Already at the beginning of our activities I set up and ran a successful offshore programming business, providing services to clients from different countries, including the U.S., therefore the next project already initially was intended and carried out to be international with an accent to the U.S. market.
How would you describe the main IT market differences – competition, entrance barriers and entrance fee – in America and Europe?
If we are talking about a possibility to create a successful online company, then the competition in the U.S. market indeed is much more bigger than in Europe. The fact is that investors higher value American companies and the funding available from risk capital funds and lots of highly-qualified private investors for tech projects there is considerably bigger. Development process of an online company starting from its beginning as a startup until its IPO or sale is absolutely transparent and easy to understand.
Before entering this market, did you know any other success stories of Russian online companies in America?
Yes, though such stories are very few. Probably the most impressive and inspiring is the story of Eugene Kaspersky, the Kaspersky Lab founder. From a small lab with six employees he’s created an international company with establishments all around the world. Kaspersky Lab is not successful only in competition with the leading American computer anti-virus progammes, such as Norton and Eset but it has a goal to beat them.
What is SDVentures secret formula in America’s market?
Unlike most of the competitors operating in this market, we placed ourselves as a tech company that make products of good quality. Moreover, we understood our clients’ desires and needs better than the competitors. We also established effective cooperation model with partners all around the world, whom we offer beneficial tech solutions.
Is there any difference between American and Russian employees? Does mentality have any influence on their motivation, awareness, work quality, capacity and other qualities?
At SDVentures, we don’t judge people by their nationality. I don’t think that capability and efficiency would so greatly depend on where a person is born. Russian specialists are no less talented or aware than their american colleagues and our co-workers in the U.S. are no less capable and motivated than in our Moscow office.
Your suggestion to Latvian IT companies- which would be the best moment to enter America’s market?
The best moment to start your actions in this market is when the product of an IT company can be offered in global mass market. To be successful in the U.S., only an interesting idea is not enough, there also must be actual evidence of that your product already works and yield results – it can be a conquered market share, monetization or other. Besides a professional team (it may be also a small one) and a strong leader able to present the project to potential investors and partners is absolutely crucial. And, of course, willingness to work 24 hours a day.
For entering the market in America – is it necessary to look for any money from the funds or is it better try doing everything by yourself and only then look for the money?
Investments in Silicon Valley you get only if you correspond all the factors mentioned earlier. You can also raise funding from incubators and accelerators in both Latvia and Russia. They verify the project idea and offer a more efficient way to raise the funding.
Where, in you opinion, is better to open the office – in Silicon Valley where are all the resources, people and ideas or a place closer to the customer?
It largely depends on the project stage. If the product has already proven itself as promising but it still needs vital technological improvements in a very short time, fund raising and skilled human resources, then the Silicon Valley, probably, is the best place for such company. At later stages, when the project is starting to make a profit, you can start thinking about moving to a cheaper place.