Belgium is a tiny country in Europe. Really tiny. With a population of only 10 million people, it’s just a tad bigger than the entire population of New York City.@BohoBri: Is Belgium a country or a city?
Belgium is also the country I grew up in, and it’s where I’ve founded my first startup Engagor 3 years ago.
Suppose you want to climb the Mount Everest. Immediately getting on a plane, and start climbing, will most likely end in a failure or worse. You better make sure you have a team in place, developed the skills you will need, be aware of the environment and have the tools to make it all happen.
Starting your own company is no different. At the start you will be small, so start small. Focus on a small market segment that represents your most ideal customer. Validate your business model, iterate on your product.
As a first time CEO, the prospect of managing a whole business can seem daunting. It’s highly unlikely that you have prior experience in running the different parts of an organization like sales, development, marketing, product, PR, accounting, finance, HR, research, customer success, growth, customer service, recruiting, legal, administration, …
At first, you won’t know all the bits and pieces of everything you need to successfully build a business, and that’s OK. What is important though is that you know what you don’t know. Grow your knowledge at the same speed as you scale your business and you should be fine.
Start building your team. You might have the fancy title of CEO, but in reality you are actually just the janitor of your company. You are the person that is doing all the shitty work that is not part of the job descriptions of your employees. When you have the money to make a new hire, always ask yourself one single question.
In what part of your startup are you spending the most time that can easily be done by someone else?
Get to know the ins and the outs of your business. Don’t go after the bigger markets or start raising money until you have a pretty good understanding of how your revenue machine works. If you would put $10 million in your company, how much revenue would come out of the machine?
The best way to get started is to focus on a smaller market segment that is easily approachable. For us, this smaller market segment was simply the whole Belgian market.
Belgium’s Biggest Advantage For Startups Is That It’s So Small
A small country has a small market. If your product is any good, you should quickly gain market share. The more market share you have, the easier it will become to attract new customers due to market scaling effects.
In Belgium, most of your customers will only be an hour away. You will be able to do a lot of face to face meetings. This will help you to further optimize your product, validate your business model, ensure that you fully understand your customers’ needs and sell more effectively.
Little to no competition. Chances are pretty low that you will have competitors in a small country, again further improving your chances to success. In the case there would already be a good number of competitors in your home country, then you should probably reconsider doing that particular startup or have an obvious competitive advantage.
Access to capital. While it’s true that Belgium does not have a lot of real venture capitalists, it is also true that there is not a lot of deal flow. This means that your odds of getting an investment in Belgium are actually higher than in the States for example.
Another huge advantage is getting coverage in the press. There are not a lot of startup stories to be told, so if you play the game right, you should be able to have good press coverage very quickly. The same is true for marketing. Once you gain a big chunk of your local market, marketing expenses will start to drop due to word of mouth taking partially over.
Think Big & Scale Fast
Of course, starting a new company in a small market has the disadvantage that it’s a small market. This means that you are forced to think global from day one.
We have always been marketing Engagor as a global company. The website is English only and we made sure it gives potential prospects the idea that we are much bigger than we really are. In the beginning, Belgian prospects were always surprised that our sales people knew Dutch, because they thought we were an American company.
Starting global is easier than it might seem at first. Especially for web companies, there are no strict borders anymore.
If you start early with your global strategy and do things right, you should be able to quickly scale your company. Once you have validated your business model, nothing should stop you from repeating that same model in new markets.
Eventually there will become a time that you start to outgrow Belgium, and you will have to make the decision to move on in order to further grow your company. This of course doesn’t mean you should stop your business in Belgium, but rather move your HQ to a larger business hub.
For us, the United States was the most logical big next step due to several reasons. First of all, it became really hard to do business development and customer service in the US from our home country due to the big time difference. By opening a San Francisco office, we can operate basically 24 hours a day.
Finding the right talent with the right skills at the right time for further growing the business has proved to be really difficult in Belgium. We have truly a great team of enthusiastic, young, capable, people in Belgium, but that is not enough to turn Engagor from a good business into a great business.
We needed more people that already had experience in further scaling a saas company as Engagor. People that have learned a lot from making earlier mistakes. People that know how to implement and successfully execute proven business strategies, tactics and processes.
Another huge advantage for hiring talent in the US is the time it takes between starting to look for new people and having them on board. In Belgium, we spend roughly 2 months in finding the correct people and then another 3 months before those people can actually start. In the US, we can find new people in less than a month and they can start in most cases 2 weeks after the contract got signed.
The whole hiring process takes us, up to 5 months in Belgium, but less than 2 months in the US. Finding the right people as fast as possible is key if you want to scale fast.
Once you want to raise a B round (or in some cases a round A, if you did a seed round), it becomes difficult to find that money in Belgium. Working with US VCs has the additional benefit that they are considered to be a trusted source, making it easier to sell and easier to gain press coverage.
There is not a single European company that is part of our target list of potential acquirers. In our case at least, moving to the US increases our chances for success.
Belgium is a great country for starting your business, but be sure to understand that it is also a small market, so think global from the start. Once you validated your business model, have traction and have enough starting capital it’s probably time to move on.