Jouko Virtanen from Takeoff Partners has overseen several successful expansions to North America, most recently with Howspace. He says that in 2021, the same laws mostly apply to expanding to North America as before—except that now you need to also appreciate the accelerating digitalization and turn it to your advantage.
Here at Takeoff Partners, we are
all passionate about helping SaaS startups expand abroad and make their
groundbreaking technology available for larger audiences. All of us have experience
in successfully internationalizing companies—and among us, Jouko
Virtanen is the expert of North America. Most recently, he has
been deeply involved in helping our portfolio company Howspace grow their business in the U.S.
and Canada, working as the company’s Sales Director. The combined effect of
hard work and the accelerating digitalization has put Howspace on an impressive
growth trajectory with nearly tripling monthly recurring revenue level compared
to one year back.
In our blog, Jouko has previously
shared his tips and wisdom on expanding
your business to North America in general, as well as
joined forces with CEO Ilkka Mäkitalo to discuss how
Howspace has found its footing in the continent.
This time, we are approaching
this topic in the context of a world that has drastically changed. The
COVID-19-pandemic is making business development challenging in many different
ways—but should it? Not if you listen to Jouko—both from the perspective of
internationalization as well as from the perspective of Howspace, an expert of
digital organizational development.
“Business development should not
and cannot stop although we are temporarily restricted from meeting each other
freely. As we have noticed at Howspace, people
are becoming readier to connect and network remotely.”
Most of the old rules still apply 1. Start
from investigative sales.
According to Jouko, this should be the first phase of
any expansion initiative to North America. Exploratory or investigative sales stands
for an approach in which potential customers are hand-picked and contacted with
an aim work together in order to test the product and validate assumptions
about market needs. This is helpful in mapping the differences between the
company’s existing markets and the North American market, as well as to
understand what kinds of solutions clients are currently using for the same
need your product is designed for. Investigative sales is a very
outbound-driven approach, meaning that the team needs to reach out to potential
customers and also actively maintain a fruitful dialogue with them. Also, if your product is a digital platform
or application, it is important to understand that the American market is
generally a little behind compared to the Nordic
market when it comes to adopting emerging technologies.
This is why you should identify the early adopters and sell to them first.2. Invest
in content marketing to generate leads.
truth: leads are more expensive in North America. Reaching the right audience
is harder because the market is so big and getting your voice heard is also
harder because there is already so much noise. This means you need to be both
more intensive and cleverer in how you invest in marketing; half-cooked efforts
will not bear any fruit. When it comes to B2B SaaS, Jouko’s advice is to create
a high-quality content
marketing plan and routine—SEO-optimized articles, eBooks, white papers,
webinars, etc. If you don’t have experience in this type of work in-house,
don’t try to do it on your own but find a skilled content marketing partner.
Also, make sure that your salespeople consistently communicate with marketing—as
soon as sales discovers new information about your customer’s interests and
needs, your team should assess if it can be used in marketing.
“It took us over two years at
Howspace to create a content marketing system that really works and brings in
leads, but it was well worth it. Today, it has grown into an impressive engine
generating over 100 sales qualified leads in a week. We have three—soon
four—people working full time just in lead qualification and booking
insight on how to succeed in 20211. Yes,
you still should open a local office.
presence, making it in North America was hard before. Now, with travel
restrictions in place, things have changed—to favor physical presence even
more. Before, you could maybe have been able to get started by traveling back
and forth for meetings. That is not an option right now, so you need someone
who is in the country. Obviously, you are still unlikely to be able to meet
potential clients in person, at least for the most part, but being in the same
time zones helps a great deal, as does the cultural proximity. Ideally, you
should send over someone who knows your company inside out and have them team
up with someone local who understands your American customers.
“I was based in Toronto when
managed GIA’s expansion to Americas. More recently, besides Howspace, also
Videoly has opened an office in Toronto. It’s a good place
to start from – a large metropolis in Canada and in proximity of many large U.S.
cities such as New York and Detroit.”
a way to network, acquire partners and create references.
North America has a very network-based business culture so the current
situation is challenging. As soon as restrictions are lifted, you should find
events where you can network. Until then – people still need to do business, so
keep your finger on the pulse of how it’s currently done in your target market
and what the near future looks like. Also, identifying the right kind of
partners and contacts for your business—those who are potential clients or
could connect you with potential clients—are very valuable. Also, references
are absolutely crucial with sales, because people are hesitant to be the first
ones to like your product.
“In North America, you may find
experts or consultants that don’t even exist in most parts of the word. These
people are influencers within their respective niche and if they are a good fit
for your product, they can become powerful partners, associates or references.
You just need to find them.”
words: it’s not about magic, it’s about hard work
North America is currently the world’s
largest economy, so becoming successful in it may feel unattainable,
even daunting. Jouko Virtanen highlights two aspects on this front:
successful in North America doesn’t necessarily have to mean becoming
successful in ALL of North America.
It truly is a
large market. This is why for most companies, to achieve the next level in
business growth it may be enough to gain a foothold in some part of the market.
For example, it could be the East Cost of the U.S. and Eastern parts of Canada. This
is also why it matters a lot where you start. Where, exactly, are your most
ideal customers located?
the end of the day, internationalization is above all hard work.
is very important when it comes to the American market. Things will probably
take longer as planned—the sales process over there generally does tend to
take longer and require perseverance. Also, unforeseen obstacles will probably
appear. This is also why anyone looking to enter the market should have planned
for some buffer.
“Often, it takes time for North
American clients until your offering starts resonating with them and this is
why you should not give up too easily. It feels really good and makes you proud
of your hard work when the client, after finally making the deal, thanks you
for being so persistent with us.”