Internationalization and Startups

Patrick Collison (of Auctomatic fame) wrote up a post about what surprised him the most about doing his own startup. Here's a small pearl of wisdom from that post that resonated with me:

Internationalization is an underexploited axis—people try to expand on the x-y plane, and ignore this third dimension. We grew our iPhone app revenue by over 200% through internationalization. The biggest competitve advantage we ever had with Auctomatic was supporting the obscure international eBay sites that the big US players ignored. I’m generalizing from pretty limited experience, but if I were a floundering start-up trying to get to cashflow positive, internationalizing is probably the first trick I’d try.

This is such a no brainer, yet you see very few startups courting international markets. Sure, there may be certain local regulations to abide by in certain markets, but most of the social stuff startups put out there today will not raise the eyebrows of most regulatory agencies in the western hemisphere. Case in point is Orkut... Have you heard of them? They are huge in Brazil.

The other issue that comes to mind regarding internationalization is payment processing. If you accept credit cards for your services, this is generally a non-issue as rates are exchanged automatically. You will probably have to deal more with the domestic credit card companies trying to minimize fraud than you will have to deal with any particular issues from international customers. Also, if you are selling a physical good, then shipping internationally is not really that different than shipping domestically.

Anyway, I thought it was a great insight that got me to do some thinking of my own...