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This article was published on July 13, 2020

What Europe’s entrepreneurs can learn from DeepCrawl’s US expansion

3 tips on how to expand to the US

What Europe’s entrepreneurs can learn from DeepCrawl’s US expansion
Stuart Veale
Story by

Stuart Veale

Managing Partner, Beringea

Stuart is a highly experienced venture capital investor who also chairs the Venture Capital Trust Association. Stuart is a highly experienced venture capital investor who also chairs the Venture Capital Trust Association.

International expansion for European companies is never easy, particularly in the USA. The rewards can be vast, but the risks can be equally significant. Many companies will overstretch and overspend, struggling to win market share in such a competitive economy.

When DeepCrawl closed its $19 million Series B led by Five Elms in March, it marked another significant step in its transatlantic journey. Having worked with the leadership team at DeepCrawl since 2017, I have seen a business take these challenges in its stride, building its own successful approach to international expansion and reaping the substantial rewards that America can offer a scaling company.

Founded in London in 2010, DeepCrawl sought to help companies grapple with the increasing complexity of website architecture. It has since scaled to become an international success story with offices spanning the UK, USA, and Europe. Today, DeepCrawl generates over 60% of its revenues in North America, and it secured its latest funding from a US VC — so it’s definitely an example worth following.

I have learnt a lot from this experience, and I hope that these lessons can support another cohort of European entrepreneurs to follow in the footsteps of DeepCrawl, establishing a success story in the US and securing funding from American VCs.

Boots on the ground: building a US presence

Making the journey across the Atlantic is not easy. From the outset, there is a lengthy list of questions facing any leadership team that is seeking to take a business into the US.

First, “who will be our boots on the ground?” Should responsibility for the expansion lie with the founders? Are there existing members of the leadership team with the depth of knowledge about the business that could fly the flag in America?

For the majority of European SaaS companies like DeepCrawl, expanding into the US is driven by a desire to grow sales. Many businesses look to recruit someone with a proven track record and a ready-made roster of potential customers. These experienced sales leaders are costly hires, and they should be treated with caution.

DeepCrawl took a different approach. For the founders, passion for the product and a shared culture of success were as important as years of experience on a CV. The company therefore chose to hire Alex Schaefer, who had demonstrated his drive to be an integral part of a growth story in an early chapter of his career, rather than an expensive black book of corporate contacts. This grit and energy has been immensely valuable to DeepCrawl’s expansion.

“Where do we base ourselves?” Location is typically second on the list of key questions. With clients on both coasts, DeepCrawl decided to situate themselves in New York — close enough to London to facilitate travel between the offices and dialogue between teams, it has proved a valuable decision.

Identifying product niches: scaling from an SEO tool to a developer platform

When the three co-founders of DeepCrawl established the business in 2010, it sought to map, track, and manage the increasing complexity of website architecture. Immediately, there was a clear product-market fit, as few companies were able to crawl and catalogue vast sites.

In many instances, companies were simply unable to understand quickly what information was held across a website. As Michal Magdziarz, CEO of DeepCrawl, puts it: “If you owned a chain of coffee shops, you would know what you owned and where it was kept — the same was not true of websites.”

The American technology industry is product obsessed. It is a technical and competitive landscape where only the leading innovators can cut through. Companies looking to establish a foothold in this environment must put product at the heart of their journey and develop an acute sense of what a customer needs to succeed.

From day one, the co-founders of DeepCrawl have shown a clear understanding of what their customers required, and built a product tailored to their needs. The platform that they built provided immediate insights into the architecture, health, and SEO performance of a website, which was vital to brands and retailers on both sides of the Atlantic.

A keen eye for innovation has been maintained as the business has scaled, and the DeepCrawl team has listened once again to the needs of its customers to build its latest product, Automator. Companies with substantial websites are in a constant process of releasing new code. If not properly tested, these changes can have a dramatic impact on the SEO performance of a website — a problem that can often go undetected for days or even weeks.

Automator will allow engineering teams to test new code for its impact on SEO performance before it goes live. The potential of this product is vast, and it has been a vital foundation for the growth story behind securing DeepCrawl’s substantial Series B.

I would, therefore, advise any company seeking to expand in the US to reflect on your product, take an honest look at how it compares to American competition, and think tirelessly about how it might be honed to cut through in a product obsessed market.

Singing from the same hymn sheet: the value of OKRs

Building an international presence brings other operational headaches. With offices in London, New York, and Krakow, DeepCrawl has a global team that it must ensure remains aligned upon common objectives.

Likewise, working with the likes of IKEA, Shopify, and Nestlé, DeepCrawl has an international client base needing the attention and support of customer success and technical teams throughout the day. In order to succeed as a global organization, Michal and the DeepCrawl leadership created a strong sense of shared ownership and collaboration across its international offices.

In this context, I believe that the implementation of OKRs — objectives and key results, a framework for defining and tracking goals and outcomes — across the business has driven a culture of success. The OKRs implemented throughout DeepCrawl create a unity and accountability in the team that you do not often see, and it has certainly been a key factor in driving the business forward.

I look forward to seeing where the DeepCrawl journey goes from here, and I hope that a future generation of European entrepreneurs will learn from its successes and reap the rewards of expanding in the US.

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