Startup Success Isn’t Made In America: It’s Built Globally

Max Nirenberg, Chief Revenue Officer and Managing Director for North America, Commit USA.

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Launching a startup will never be easy—just ask the 90% of startups that fail to take off. But just because the odds are stacked against you doesn’t mean success is out of reach.

Many experts will tell you that to ensure success, there’s no better place to launch a company than the U.S.—and 10 years ago, this was sound advice. In 2012, six of the top 10 startup hubs were in the U.S., and nearly two-thirds of early-stage funding was concentrated in North America.

But today, we’re in a vastly different startup ecosystem, one in which success isn’t made in America—or any one nation. It’s built globally.

Our world and workplaces are evolving, and new technologies are making it easier than ever to connect with the global economy and marketplace, presenting massive opportunities for organizations willing to look beyond their own backyard.

In gaining access to talent and resources, lower costs and/or new customers, startups capitalizing on globalization position themselves for success and establish a competitive advantage for years to come.

We must overcome budgetary constraints.

Many startups struggle to overcome budgetary challenges, particularly when bringing new innovations to market. For most startups, one of the biggest cost drivers arises from how teams are usually built and managed.

Let’s face it, the costs of hiring competent tech experts are skyrocketing. Today’s average U.S.-based software engineer earns around $140,000 annually, and this can be much higher for experts in high-demand fields such as cloud computing, analytics, AI, FinTech and MedTech.

Time spent recruiting talent can carry hidden expenses, too, with 68% of software development startups requiring one month or more to recruit one developer and 20% of recruits having to be replaced. If teams aren’t careful, costs for recruitment, retention, training and more can burn through budgets.

Providing a way to cut expenses without sacrificing quality, globalization offers top-notch tech development talent at a more affordable cost. That’s why 70% of respondents to a 2020 Deloitte survey said their primary reason for outsourcing was cost-cutting.

By sourcing from a global pool, organizations are no longer tethered to local resources and can pull from a wider talent pool to gain skills faster and at a lower cost. This can be invaluable when operating within limited budgets and quick deadlines.

It’s important to seek out experts.

Globalization isn’t just about cost-cutting. Many high-tech startups require a range of experts to develop new technology. These professionals include product managers, software developers and designers, DevOps engineers, database specialists and more.

Moreover, many foundational R&D elements, like securing data or choosing the right technology, must be addressed upfront. If a team chooses the wrong platform in the beginning, it could impact development or force them to rely on costly, vendor-compliant hardware.

Many mistakes can be avoided—and projects kept on track—by ensuring your team has the resources needed to handle all elements of a project. Importantly, this means having experts capable of addressing issues before they become problems.

Sourcing professionals globally expands one’s talent pool, providing access to hard-to-find niche skillsets and holistic experiences. This is important in fast-changing industries, such as fintech, in which emerging technologies like blockchain evolve at breakneck speeds.

We need flexibility and scale.

In high-tech startups, not every skill set will be needed at the same intensity during the entire development process, especially after a product launches. Failing to recognize this could deplete budgets, leading to a halt in production or, worse, abrupt layoffs—something we’ve seen too often recently in tech.

Many startups, especially those that have raised $5 million or less, could benefit from a leaner, more flexible approach to managing resources. Globalization can be key to achieving this.

With rapid and expansive access to talent, any size of organization can structure and build teams that better account for budgets and skill requirements.

For example, many newer startups only require a business lead, a product lead and a technology lead. Rather than hiring a full-time team of developers, these organizations can benefit by outsourcing the remaining roles on a project basis.

The three permanent managers lead development from start to finish—ensuring information flows smoothly and vital knowledge isn’t lost—while focusing temporary employees on specific tasks. Once a task is accomplished—and the role no longer necessary—the project is then complete, and resources and budgets can be reallocated to where they’re needed.

Without sacrificing quality, this approach offers greater budgetary control over development costs.

Multiple perspectives enable stronger innovation and vision and greater success.

Relying too much on a single individual or homogenous core group is a sure way to hinder innovation.

Bringing together diverse perspectives can be invaluable in promoting vital new ways of thinking. This is one reason companies with diverse teams are 35% more likely to perform better and 70% more likely to capture a new market.

Thanks to globalization, it’s never been easier to access diverse talent with unique ideas and experiences when it comes to technology, challenges, cultures, governments, organizational structures and methodologies. This can improve how an organization operates—such as by sharing best practices or new tools. For example, having intimate knowledge of a specific region or culture can influence how an organization positions itself in adapting a final product for use in different global markets.

Globalization is no longer an alternative; it’s imperative.

No matter how good an idea is, creating a winning startup still comes down to building a team with the best talent and the right expertise.

However, while globalization unlocks many opportunities, it doesn’t guarantee that every company will succeed. There are many approaches to globalization—success largely comes down to knowing how to capitalize on reaching beyond your time zone or geographic boundaries. For companies that struggle, finding and leveraging partners who share your same core values and have a long global reach will significantly raise your chances of achieving your goals.

So, if you’re launching a startup, don’t worry about being “made in America”—think globally to find the best talent, period.

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