Partners won’t save your startup from failure (but clients will)

From the startup in 2008 to date, we announced at least 10 unique partnerships between Leverate and other companies. They cost tons and, at times, took all the brainpower and sweat we had. Every single one of these partnerships has failed (channel partners aside).

When I listen to startup founders, I sometimes notice the abuse of the word “partner”, and it reminds me just how unclear we were around the partnerships we took. I’ve heard this word from startup founders to describe what I would otherwise call “client”, “vendor”, “distribution channel”, “an opportunity to get some PR”, “another company that we want to have an integration with because it’s cool” or in the worst case “an established company in the industry who thinks we’re neat but we’re not sure what’s in it for us or them”.

Undefined partnerships are dangerous. And they often come with the promise of some PR, especially in fintech, where banks and consulting companies enjoy setting up accelerators and hanging out with the cool kids (startups). This has been funnily described as the fintech zoo. An executive at a bank or established company may talk to a startup about partnership opportunities that can generate a mention or two in the press, but…

startupculture
Pictured: the beginning of an epic failure

Continue reading “Partners won’t save your startup from failure (but clients will)”

Partners won’t save your startup from failure (but clients will)

The Tech Founder’s Guide to Cracking China: The Customer Service Meltdown

Our first customer service (CS) person in Asia shocked me with a resignation just one week after I landed in Hong Kong. He said it was health related. Damn. We had about 9 clients in China at the time, and he was the only customer service person in the company who could actually speak their language. I promised him that I’ll work on a new recruit the next morning. I tried to paint him a less hectic future, and I truly believed in it. In a short-sighted whim I even offered him a title and a much, much higher pay. He said no thanks. He was so burned out I could smell the smoke. I ended up hiring 2 people to replace him, taking into account our near term growth.

The second CS person quit 5 months later. She said it was family related. Tough luck, I thought- and set out to find the next person. At least I was encouraged by a strong delivery on sales. Hell, Sales Cure All.

When the third CS person quit, I hardly bothered to ask why. I knew it couldn’t be a coincidence- something was wrong with how we built the team. But also I knew that the guy would give me a million Hong Kong Dollars before he tells me why he hated his job. It’s common for people in HK and China to avoid confrontation and try to save their boss from “losing face”. They didn’t seem to notice that I was much closer to losing my mind. All I wanted was for someone to gimme some truth, but I knew I had to search for the reasons elsewhere.

OK, I wasn’t that clueless. I’d been running both Hong Kong and Shanghai for over a year year at that point. Things are always harder away from the HQ, and customer service is a thankless job almost by definition. But I couldn’t explain what was causing such a strong and continuous implosion, while sales and marketing kept growing and delivering.

crying bar

Nearly desperate, I switched to recruiting mode again. And then I finally started noticing a pattern: many of the people I interviewed in HK & China left other foreign companies under the same circumstances: the company was new to Asia, and the person struggled for a year or less before quitting. When speaking to candidates, they told me everything that our staff who resigned wouldn’t tell me. I listened carefully as they described The China Customer Service Meltdown happening in their previous company and leading them to quit. And I realized that as much as these people seem driven and talented, I run a risk of losing them for the exact same reasons again. I also learned from other friends who run businesses in HK, and especially China, that constant bleeding on customer service is very, very common (in local and foreign companies).

Here’s the dynamic that leads to the China CS Meltdown:

Continue reading “The Tech Founder’s Guide to Cracking China: The Customer Service Meltdown”

The Tech Founder’s Guide to Cracking China: The Customer Service Meltdown

Five types of communication in tech companies- and what tools you should use for them

In the previous post, I shared a few notes on internal communication in tech companies. In this post, I’ll take a step back to discuss what types of communication exist in a tech company, highlighting cross-department communication. For each type of communication, I will discuss the tools that can serve you best… and worst.

Here are the kinds of communication that I noticed along the years at Leverate:

#1 Boards

Boards = lists that departments maintain so that everyone in the company can check them out. Boards will usually reflect recent work, so their contents will change with time. Examples:

  • Next releases board– maintained by the product team
  • Latest sales board– maintained by the sales team
  • This month’s lead numbers board– maintained by the marketing department
  • This month’s birthdays board– maintained by the HR team
  • This year’s holidays in our offices worldwide– maintained by the HR team

Boards can come in different flavors:

  • Crucial for day-to-day work OR a nice-to-have transparency tool
  • Designed for internal communication in the department OR designed for communicating to other departments

If you ever worked in a sales team, you’ve most likely seen a board that sales leaders love: the monthly leader board. Nothing invites more motivation and focus than these cold hard numbers on the wall.

depulse
Example: board in daPulse

When shared cross-department, boards are perhaps the most simple and to-the-point transparency tool that I’ve seen. People love them (when they’re up-to-date, of course), and they create a feeling of accountability among critical departments. I highly encourage founders to introduce a board for product, sales and marketing to reflect releases, sales data and marketing data respectively.

What do we need in a board tool?

  • Public– anyone can easily check out boards
  • Collaborative– anyone can create boards, then quickly edit / comment / like items
  • Good lookin’– it’s nice to add some colors or communicate planning vs. execution with a ‘dashboardy’ feeling
  • Topics & subscriptions– would be nice if people can subscribe for specific boards (e.g. next releases) and get notified on updates
  • Interactive– it would be nice to click an item (e.g. a specific planned release) to get more information (the release notes)

Recommended tools for boards:

  • The board feature in daPulse
  • A public Google Spreadsheet
  • Trello
  • Build your own– home-made boards are always an option: in some offices I’ve seen TV screens projecting retention, sales and even revenues data to all employees
  • The wrong tool: emails

 

#2 Shouts

Shouts = casual cross-department announcements. Usually to the entire company. Usually happy. You don’t know exactly when they will come. They’ll stick around for a couple of days and then they will get washed away. Examples for shouts in a tech company are:

  • An introduction of a new key employee that everybody needs to know, including a picture of them with their dog
  • An announcement from the CEO about last week’s acquisition
  • Pictures from the crazy team building night that the marketing department had last week, including that video of the VP Marketing dancing on a bar table that will haunt her forever
  • An announcement from the VP sales on the epic performance of the sales team during Jan & Feb, including a chart

What do we need in a shout tool?

slack
Example: shout in Slack
  • Notifies everyone, but minimizes spam– shouts are cool, and sometimes you want to announce something to all, but people don’t like getting 12 random emails per week. Better find a tool that minimizes announcements to all, aggregates notifications and lets people choose their topic(s) of interest
  • Social– anyone should be able shout on any topic, because everyone has something interesting to celebrate every now and then. A good tool will let other people quickly like / comment on the shouts. It’s also nice to see who in the company read the shout
  • Allows attachments– it’s nice and engaging when shouts come with an inline chart, picture or video

Recommended tools for shouts:

  • Posts in Facebook at Work, daPulse or Yammer
  • Slack
  • Emails (not ideal)
  • The wrong tools: your company wiki, Trello

 

#3 Knowledge bases

Knowledge base = an evolving collection of articles and media items. Think about a company-wide wiki. Knowledge bases are naturally different from boards and shouts because they contain information that you want to evolve and stay long term.

Examples for knowledge bases in a tech company are:

Continue reading “Five types of communication in tech companies- and what tools you should use for them”

Five types of communication in tech companies- and what tools you should use for them

On internal communication tools for startups

Six months ago, a friend of mine who worked at a growing 30-people startup approached me to ask what tool we use to communicate between departments at Leverate.

Smart guy, I thought. I will never forget the colorful chaos that broke loose when we scaled from 30 to 140 employees in just two years. A headcount of 30 is an ideal tipping point for internal communication to take new forms.

Communication inside Leverate has evolved quite a bit along the years. We’ve been using a good number of tools to manage departments and share stuff cross-department. These tools include email, phone, boards, Slack, ConfluenceWiki, Yammer, daPulse, Google Docs, TFSSharePoint, Trello, Facebook at Work and more. Some of these tools were so beautifully designed, that they downright fueled me with insights on leadership and communication. Others stormed into the company for a one-week-stand that everybody hated.

trello
Left: Trello. Right: reality

Here are some lessons I learned on internal communication in startups: Continue reading “On internal communication tools for startups”

On internal communication tools for startups

Can Hong Kong really become a fintech hub?

Jeffrey Broer has recently published a blog post called Fintech, the polarizing industry for Hong Kong. Through a bunch of interviews he shared the pros and cons for starting a fintech company in HK. Fintech is indeed a loaded topic in HK- the scene is small and people have strong opinions on its good, bad and ugly corners.

It’s no secret that HK lags behind London, NY and Singapore in fintech. Since HK has made it clear that it wants to be a fintech hub, let me ask more specifically: what’s standing in its way to become one? What’s going to really move the needle?

Continue reading “Can Hong Kong really become a fintech hub?”

Can Hong Kong really become a fintech hub?

The tech founder’s guide to cracking China: 8 product gaps to fix before you go into China

In this series, I will try to share a list of product/tech gaps that tech companies need to address when approaching China as a market. The lessons are partly based on my own dumbass moments. I’ve tried to share them in a way that’s useful to western techies who know very little about the tech landscape of China.


Being a techy who decided to take his company to China, I was eager to quickly master the product/tech landscape in the country. China, of course, had different plans for me: it forced me to learn 10 cultural lessons for every product lesson along the way. Which explains why 99% of the books and blogs about China will only touch on cultural gaps such as “face”, guanxi (relationships) and handling broken communications with pretty much everyone around you.

You need to go a long long way to succeed as a foreign technology company in China. 70% of your struggles will be completely unrelated to your technology (ask Uber). But if you’re an existing tech company that wants to go to China, or an executive at one, it’s worthwhile looking at the tech related 30% first. For one thing: there is a good chance that your product wouldn’t work if you tried to use it from China right now. Here’s a small list of common product gaps in China, some of them non-trivial. Make sure you close them in advance. It’s no fun trying to fix these when you’re already trying to do business in China.

0. embrace Simplified Chinese

AKA localization for dummies. Pretty straightforward. Your first Chinese staff should be able to read and speak English (more on that when I discuss hiring). But make no assumption about the actual users of your software, whether it’s B2B or B2C. In fact, do make the following assumption: nobody will be able to read English. Not even the amount of English that allows them to find the “switch language” link. We make software for financial institutions, perhaps the most world-facing sector in China, and we still get non stop requests to translate our software for B2B users who can’t use it in English. Action items:

  1. Get good quality translation management software and use a translation service (I recommend HK based OneSky and heard good things about Transifex)
  2. Make sure your app starts with a full Simplified Chinese interface (Traditional Chinese is the written language only in HK and Taiwan. No need to add it for China).

Fun fact: Simplified Chinese is a character set that introduces easier ways to draw thousands of characters (words) compared with traditional Chinese. It was introduced to China by Mao Zedong only in the 1950’s and 60’s, and it had one purpose: to increase literacy rate. Today it’s the de-facto standard of written Chinese. So it’s essentially one of the most ambitious and successful “top down” operations in the history of human language!

1. get your head around Operating systems and platforms (mobile, web and desktop)

To the Western techy, the platform landscape in China is plain jungle. China doesn’t care if you like the dominance of IE6 or the invisibility of Google Play Store- and you have no choice but to play along. Check out my previous post for the full picture across web, mobile and desktop platforms: Localizing for China: the mobile-web-desktop platform Landscape (or: welcome to the jungle)

2. solve Connectivity and hosting issues

China has a shaky internet infrastructure, especially outside tier 1 & 2 cities, and the Great Firewall of China adds a variable (usually heavy) tax on the internet traffic. Jitter and occasional disconnections happen quite a lot. The final picture will make your CTO grow a couple of white hairs. I have no doubt that within a couple of years the Chinese internet will leapfrog towards (and beyond) what’s known to the rest of the world, but this optimistic thought won’t help you when setting foot in China today. Action items:

  1. Test for connection quality at least from 10 tier 1 and tier 2 cities (we found the local 17CE or the international CatchPoint useful). The less heavy your content is (think video) and the less connection sensitive (think finance), the better off you are.
  2. Disappointed with the test results and unwilling to relocate servers to Asia? Consider acceleration services such as Aryaka. Most of them have cooperations with local Chinese CDN’s such as ChinaNetCloud or ChinaCache. Paying extra dollars for the joint product will help you serve Chinese users from local POP’s (points of presence) all across China. The results are impressive, but price is a major consideration in this setup.
  3. Disappointed with the test results and willing to relocate your servers? Well, if you’re only starting in the China market, there aren’t many reasons to host websites inside China itself (which requires an ICP license anyway). HK is considered the next best option, and the result is perceived as excellent by all companies I’ve spoken to (even in the financial space). Singapore and Tokyo are also popular.

3. do Payments right

If you accept online payments, make sure your PSP can accept China UnionPay (CUP) cards. With little challenge from Visa and Mastercard, CUP is the network behind 80% of the cards and 72% of the card transaction volume in the country. Recent studies have found that China UnionPay has a shocking 100% brand recognition among Chinese living in China. Other payment methods (AliPay, TenPay) are nice to have. I’ll discuss them in future posts. For now take note: doing online business in China is not possible without China UnionPay, so make sure your current PSP can accept it or partner with a new PSP for China.

chinese internet users

4. forget about google

Make this your first Chinese lesson: Google is blocked. This will affect you right away if you use Google CDN (common use: loading JQuery). Our users in China suffered from dead slow startup time for our web platforms until we removed all references to Google. I heard from another tech company that all critical call to action buttons (think “buy now” button) disappeared in China because their CSS files were hosted on Google CDN’s. Nice! Action items:

Continue reading “The tech founder’s guide to cracking China: 8 product gaps to fix before you go into China”

The tech founder’s guide to cracking China: 8 product gaps to fix before you go into China

‘Blockchain’ has officially turned into an empty buzzword

We need to talk about something, fellow fintech folks: the word ‘blockchain’ has left the ground and started going completely out of control recently. It takes only a quick look at Twitter’s #blockchain page to get that.

I started suspecting when well intentioned marketing people of a large bank used it non stop in a fintech event in Hong Kong. Banks seem to be all over the blockchain right now. I doubt that this technology can solve any acute problems for HSBC or Citibank, but I get them. “Blockchain” sounds cool and they’re too rich and too threatened by Bitcoin (the asset) to ignore the technology behind it.

On another event I heard the following question from an investor: ‘I got pitched by several blockchain startups. Would you advise me to invest in them?’. Yesterday TechCrunch joined the bandwagon and announced that the blockchain might be the next disruptive technology. For serious media that wants to look deep into the future, it’s a fair title and it can invite a serious discussion (which the Bitcoin community doesn’t lack). But the content mostly glorified ‘blockchain’ as a buzzword, and that’s wrong.

Continue reading “‘Blockchain’ has officially turned into an empty buzzword”

‘Blockchain’ has officially turned into an empty buzzword