BUSINESS - BUILDINGEUROPE vs. USA

Management Center InnsbruckMarch 10th,2015

2

Zlatko Turkal is co-founder & CEO at @b_exchange . 3x entrepreneur & business guy. He’s running companies in the B2B markets for 12 years, both in Europe and the US. Starting things is in his DNA.

At the age of 23 he started Medialab Inc, a successful international company specialized in building tailored B2B solutions, both hardware and software, for customers such as airports and government.

His professional goals continue to be driving innovations and building solutions that brings completely new way of doing business online, such as www.business-exchange.co.

@zturkal

“It is common sense to take a method and try it. If it fails, admit it frankly and try another. But above all, try something.”

- Franklin D. Roosevelt

KNOW YOUR STUFF!

- UNDERSTAND THE PROBLEM YOU ARE GOING TO SOLVE.

- UNDERSTAND THE MARKET DYNAMICS.

- UNDERSTAND WHO YOUR CUSTOMERS ARE.

- UNDERSTAND HOW THEY MAKE BUYING DECISIONS.

- UNDERSTAND WHO INFLUENCE THEIR BUYING DECISIONS.

- UNDERSTAND WHO YOUR COMPETITORS ARE.

- UNDERSTAND YOUR ADVANTAGES.

B2B SALES

VS.

B2C SALES

SHORT SALES CYCLE

CHEAPER

OFTEN EMOTIONAL

HOOKUPS

I DON’T KNOW YOU!

- XYZ %

LONG SALES CYCLE

MORE EXPENSIVE

RATIONAL

RELATIONSHIPS

TRUST IS CRUCIAL!NON DISCOUNT %

PAIN POINT/NEED RESEARCH NEGOTIATION PURCHASE

B2B SALES CYCLE

9 OUT OF 10 BUSINESS BUYERS (BB) SAY WHEN THEY ARE READY TO BUY, THEY WILL FIND YOU

81% OF BB START

THE PROCESS WITH A WEB SEARCH

84% SAID WORD

OF MOUTH RECOMMENDATIONS INFLUENCE THEIR PURCHASE

1. CAN I SEE YOUR

WORK?

2. HOW MANY

REFERENCES DO

YOU HAVE?

3. ARE YOU

TRUSTWORTHY?

4. WHAT IS YOUR

PRICE?SOURCE: FORRESTER RESEARCH

AS THE B2B SELLER,

YOUR JOB IS TO

INFLUENCEBUYER’S DECISION

EVEN BEFORETHE NEED ARISES.

S

BUILDING TRUST IS NOTBUILDING ONLINE PRESENCE IS EASY

BUILDING INFLUENCE N THE B2B ARENA

BUY ONLINE DISPLAY ADS

HIRE PR PERSON/AGENCY

PAY FOR PRINT ADVERTISING

TV ADSYour expenses will be outrageous compared to your benefits in the short run and you don’t have

enough cash to support these activities in the long run.

IN HOUSE SALES TEAM

GET REFERRAL PROCESS IN PLACE

SURVEYS (require feedback)

GROWTH HACKING

BLOG

EMAIL MARKETING

SEO/SEM

EVENTS FOR THE EXECUTIVES

TRADESHOWS/CONFERENCES

COMPANY #1

A company specialized in quiet computing & tailor made software solutions.

- $0 fundraised.

MEDIALAB ltd. (PULA,CROATIA)

- Founded in 2003 (pre social

media era).

- Company revenue grew from

$0 to $700,000 in 24 months.

- 80% of the revenue came through referrals.

Surveillance systems company

IT & Telecommunication

company

Hotel management

software company

ERP Software company

BUILDING THE “REFERRAL ENGINE” WITH EXISTING CUSTOMERS

CUSTOMER #1 CUSTOMER #2

CUSTOMER #4 CUSTOMER #3

20% of all referrals coming through this customer.

10% of all referrals coming through this customer.

10% of all referrals coming through this customer.

40% of all referrals coming through this customer.

20% of all referrals coming from all other customers

MARKETING ACTIVITIES

- IN HOUSE SALES TEAM.

- ADVERTISING ON THE RADIO.

- BILLBOARDS.

- FLYERS (DISPATCHED BY GIRLS ON ROLERBLADES IN THE CITY CENTER).

- SPONZORSHIPS & DONATIONS.

- PARTNERSHIPS WITH REPUTABLE IT MAGAZINES.

BUILDING A SUCCESSFUL COMPANY. . .

KNOWLEDGEPERSISTENCE

LUCK

“”

- Gary Player

BEING LUCKY; STORY #1I was 23 and I just started Medialab. Few months after the day I signed the certificate of incorporation I found

myself in the local bank president’s office with the check for $100,000 in my hand.

I was insanely lucky to get myself into that situation. Here is the story; at some point Medialab had gotten more

orders from the customers than we would have expected, and we didn’t have enough money to buy goods from

suppliers and deliver stuff that had been ordered (at the time in Croatia, you would get paid after you deliver

goods/services, and we had been buying parts from the suppliers based in the US and we had to pay for each

order upfront). $100,000 was missing.

In those first months of operations we were lucky to get one of the largest local ERP software company as a

customer. I closely worked with their CEO (the CEO) on a regular basis. One day, over the lunch I had with the

CEO , he asked me how things were going?

I said; perfect in terms of the interest we are seeing from our customers, but we don’t have enough money to

get the goods. Both my co-founder and I are 23, out of cash and not eligible to get a bank loan by any means. I

think we have to miss this opportunity and keep pushing forward on a slower pace.

BEING LUCKY; STORY #1

That same day in the evening, my telephone rang. It was the CEO. He asked me; do you have time tomorrow at

noon to meet me in the local bank president’s office. I just replied; sure. And the conversation was over.

The office was on the top floor of a massive, over 100 years old building. Right after I shook hands with the

president and we all sat down the CEO stated; This is my friend Zlatko, who is running a company with a great

potential. They have lots of orders from customers but they are missing $100,000 so they collect the parts from

suppliers and deliver orders to customers. I want you/the bank to issue him a loan of $100,000 as soon as

possible and he will repay you money back in 30 days. Is that right Zlatko, he asked me. I said; damn right, sir.

The CEO then said; I’m here to guarantee with my name and my money that the debt will be repaid on time.

And it had been! Medialab repaid the debt on the day 29.

The CEO and I …. We are very good friends since and he is a mentor and a second father to me. Our revenue

skyrocketed to $700,000 in just a few months following the event at the bank. I really don’t know what would

have happened with Medialab if the CEO hadn’t been in the picture at that point.

COMPANY #2

An online referral engine for B2B companies

- $165,000 fundraised.

BUSINESS EXCHANGE (USA)

- Founded in 2012 (Palo Alto).

- First 1000 users/businesses acquired in 6 months.

- Straight shot class of 2013 alumni.

MARKETING ACTIVITIES

- IN HOUSE SALES TEAM.

- SURVEYS.

- GROWTH HACKING.

- BLOG.

- SEO/SEM.

- EMAIL MARKETING.

- TRADESHOWS/CONFERENCES.

- ASSOCIATIONS WITH CHAMBERS OF COMMECE.

- WIDGETS.

BEING LUCKY; STORY #2

HOW DID WE GET

TO BE A PART OF:

“Organized by 500 Startups, Geeks on a Plane (#GOAP) is an invite-only tour for startups, investors,

and executives to learn about high-growth technology markets worldwide. We travel by planes, trains,

and automobiles to the most exciting international startup scenes with the sole mission of uniting

geeks and exploring cross-border opportunities. The result: a lifelong bond with fellow travelers, a

wealth of new friends and business contacts in exploding technology markets, and a stronger

appreciation for the cultural and economic ties that bind us globally.”

It was June of 2012 and we applied to be a part of the upcoming GOAP tour in Eastern Europe,

without even knowing what the cost of the trip would be. Within just few days after the

application had been submitted an email from 500startups hit my inbox. The email was like; Hey

Amit, you are invited to join our GOAP tour in Eastern Europe, the cost for each founder would be

$x,xxx and you have 24 hours to claim your spot.

Let’s put it simply; we didn’t have that money. Not even close, we were a startup after all!!

So I replied: You better count on us!

It took me 15 days to find sponsors for the trip who at the end paid all our costs. It goes without

saying that I still can’t thank enough for companies and organizations that made that trip happen. I

felt like the luckiest guy on earth (and I still do).

The GOAP trip turned out be of a crucial importance for the development of Business Exchange.

We got to know some of the best people in the industry who then made crucial connections with

more people back in the US which finally led to moving Business Exchange operations to the US

market just 2 months after the trip was over.

Within 6 months after we moved operations to the US market, the Business Exchange team

fundraised $165,000 from the Europe and the US based investors combined.

vsSTARTING A COMPANY

RESOURCE: WHY EUROPE LAGS THE US IN TECHNOLOGY STARTUPS

VS.

LONDON

DUBLIN

BERLIN

CAMBRIDGE

WEST COAST:

SAN FRANCISCO

SILICON VALLEY

LOS ANGELES

LOCATION

TALENT

THE SIGNIFICANT MOBILITY AFFORDED TO EU CITIZENS.

WIDE-RANGING SKILLS POOL IN MANY PLACES (INCLUDING DUBLIN AND LONDON).

DIVERSE TALENT POOL.

STRONG SPRINKLING OF ENGINEERS, SOFTWARE DEVELOPERS, AND VENTURE CAPITALISTS.

SIGNIFICANT ASIAN INFLUENCE.

52.4% OF SILICON VALLEY STARTUPS HAD ONE OR MORE IMMIGRANTS AS A KEY FOUNDER.

FOUNDERS ORIGINATED FROM ALL OVER THE WORLD—FROM AUSTRALIA TO IRAN TO VIETNAM.

VS.

MARKET SIZE

28 MARKETS

24 LANGUAGES1 MARKET

1 LANGUAGE

POPULATION OF 318.9 MILLION (2014)

HOMOGENOUS MARKET

VS.POPULATION OF OVER 500 MILLION (2014)

DIFFERENT CULTURES AND CURRENCIES

FRICTION TO INNOVATION (PARTICULARLY IN TERMS OF MARKETING)

1 CURRENCY

SUPPORT SYSTEMSACCELERATORS

ANGELS/SEED VC

GROWTH EQUITY

HIGHER VALUATIONS

VS. $100M + VC FUNDS

ACCELERATORS

$100M + VC FUNDS

GROWTH EQUITY

LAWYERS, PR FIRMS, MEDIA, etc.

ATTITUDE TO RISK

VS.

Thank you!

Lets connect, shall we!?@zturkal