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NewsGator announced today that it has partnered with GMO Internet Group to provide a localized, hosted version of NewsGator Enterprise in the Japanese market. I’ve been impressed with GMO – they’ve also partnered with FeedBurner on the Japanese version of FeedBurner.
Geographic expansion, especially for young fast growing companies, especially in Asia, is tough. After spending time in Europe last month, I heard the same thing over and over from the VCs and entrepreneurs that I spoke with – namely “the biggest weakness of US companies is they come over here thinking that everything works the same way, but it doesn’t.” This wasn’t just aimed at “US is different than Europe” – it was a bigger statement – namely even thought there is an EU, each country is different. I’ve heard this for a decade, seen the downside of this many times, and believe it continues to be a very true statement.
Now – this conversation is nothing new in the world of VC-backed companies. I’ve been through the “let’s expand to Europe and Asia immediately” cycle, capitulated in the delightful 2001 – 2003 time frame (Europe / Asia – where are they again?), and now am faced with “The World Is Flat – we’ve got to go to Europe and Asia.” While I don’t resist the “we’ve got to go to Europe and Asia”, I’ve learned from my experiences (good and bad) that the “how” is what is important. In the case of NewsGator, a big part of the how is with partners, including VNU in Europe and GMO in Japan.
This announcement also has another little nugget – the product that GMO and NewsGator will be releasing together in the Japanese market is a hosted version of the NewsGator Enterprise product. Geographic partners usually know their market entry strategies best – it’s important to listen to them.