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Getting out of India for SaaS - Part 2

Rohit Jain, Co-founder, Partner at Pravega Ventures

I recently spent some time meetings companies at NetApp Excellerator (liked the spin on the name). All the companies there are building enterprise software products, and invariably my conversation with the founders started with discussion on my post ' Getting out of build for India for SaaS', that most founders had read. The discussion that happened capture a lot of what other founders are also probably thinking, so I decided to capture it here.

While most enterprise tech founders I have met recognize that they need to go to a bigger market (read US) at some point, the questions are about whether when to go, the approach to take, how much does it cost etc. A lot of founders think this as a step to be taken after proving product-market fit in India, getting close to a million dollar ARR and a couple of million dollars in the bank to afford the expense of one or more founders moving to US.

I want to question this by starting with the notion of product-market fit itself. A common perception is that for a SaaS product, a fit in Indian market works as well in the US. But beyond the product's core functionality, the other aspects vary quite a bit depending on the ecosystem.

Here's a typical SaaS product in its ecosystem:

So where do companies get taken by surprise when they go from India to US ?

Market segments: Apart from some tech startups, the traditional small business segment in India is really non-existent. Even for the businesses that can buy some software, most are first time buyers, are not amenable to self-serve low-touch sales channel, and given the small ticket-size are uninteresting for SaaS providers.

This naturally forces a lot of startups to move upmarket and target companies with upwards of 1000-5000 employees. [Or you would have very early started targeting small business segment in US which is the right approach ] Naturally, this segment requires high-touch sales model and some integrations to ERP/accounting vendors like SAP, Oracle and some homegrown vendors like Tally. So, now at this point if you want to break into US market, you either have to decide to go for the Small segment or the Medium segment, and it turns out that in either case other than the core product, most other functions need to be rebuilt.

What changes if you go from selling to Medium segment in India to small segment in US

 Product: For a light-touch model selling to small business, the customer on-boarding has to be become self-serve, self-help features need to be present, and support over email/chat needs to be effective and scalable.

Marketing and sales: If you were selling to larger businesses in India with feet on street model and assisted on-boarding, chances are your online marketing muscle would be severely under-developed. You will need to hire new talent and build teams for both inbound and outbound:

a) Building robust online presence with well-defined content strategy - comprehensive site, blogs, videos/webinars and a well executed SEO process.

b) SEM: SEM is still more of an art than science and it will again take time to explore the keywords

c) Learn the ropes of other channels for enterprise software discovery like Capterra, Siftery etc.

On sales front, the inside sales engine of outbound prospecting, lead qualification, sales development/nurturing needs to be developed. This means hiring people, training, experimenting with different sales tools, learning from mistake and iterating. All this has a learning curve and it can take a few months to a few quarters to get the online sales and marketing engine humming.

What if go from selling to medium enterprises in India to US ?

The segment here remains same but there are a different set of challenges to be overcome.


  1. Industry Maturity: US has been dominated by large organized businesses in most areas for a very long time while in India this is a more recent phenomena. As such, the maturity level of companies in areas like BFSI, Healthcare, Retail is very different in two markets and thus requirements tend to be different. One company that I know was building data analytics based solution for fraud detection in NBFCs in India, but when they pitched in US, they realized the requirement was for compliance solution.
  2. Product Integrations: Again the fact that US is a mature enterprise market means that almost all companies would be using one or more platform level softwares in ERP, Accounting, Marketing etc. Integrations with these 3rd party softwares is table stakes.
  3. Cloud vs on-prem: Most companies are still only partially on public cloud. You may have to redesign to support on-premise/hybrid model of deployment. 
  4. The security requirements and data privacy regulations are much stricter in US, and data storage and access architecture needs to account for that. Sectors like healthcare and financial services are particularly strict and this is non-trivial work.

Marketing and Sales:

On the marketing and sales side, the learning curve is even steeper.

  1. Field sales is very dependent on the cultural and social context, and the people and processes you have in India will probably not work in US. On top of that, the large Indian enterprise clients will not be credible as reference clients either [This has worked for markets in SE and Wes Asia but not in US/Europe]. Overall, there are still very few examples of Indian product companies that have scaled enterprise sales with on ground sales force in US and remains a bug challenge.
  2. Channel sales: Most large software platforms like SAP, NetSuite, Microsoft Dynamics etc have a rich implementation/reseller partner ecosystem. The more integrations you have the more channel partners you can work with. 

So the product-market journey often needs to be negotiated again when you switch from India to US. If you have ambitions for the latter, you need to build your company for that from early on. Otherwise, the time lost in retooling for US market will put you at a significant disadvantage to your competitors who are in that market from early on.

What are implications for a seed stage company ?

Now as a seed stage founder you would have probably raised less than .5M, so you are wondering how do you go about this. Here are a few things that I have seen working:

  1. From very early-on, founders can travel to US for a few weeks at a time. Connect with potential early adopters of your product, other founders and connects at other SaaS companies. Over the last few years, the Indian network in valley has become very strong with numerous successful founders, senior execs, and investors. You need to tap into that. There are good lessons that we can learn from Israelis here.
  2. US is very strong on industry trade shows. If you trying to sign up early customers from medium scale enterprises, you can start building presence by attending these. There are opportunities like taking a booth, sponsoring a dinner table etc., that are helpful in attracting customers without breaking the bank. 
  3. Overall be ready to hustle - live cheap and travel cheap. A 3-4 week trip should be possible in 5-6 Lakhs so a trip a quarter is very doable.

Finally, this is about going out of your comfort zone but I strongly feel that for large companies to come out of India, founders need to embrace this approach. In our Pravega portfolio, Innovaccer is a great example of a company that has found success with this.

[Thanks to Mayank for useful inputs on an earlier draft of this. Mayank has experienced some of these issues first-hand building companies from India before.]

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