David Soskin, chief executive of Cheapflights.co.uk, is one of the few business leaders that has gone to the US and succeeded. He offers some pearls of wisdom on the topic
The US market has often been described as a graveyard for British companies. Our failures there are the stuff of business legend. Whether it is Marks and Spencer’s acquisition of Brooks Bros, the ill fated purchase of Reltec and Fore Systems by Marconi, British adventures in North America have a bad reputation.
But that did not put off Cheapflights! We entered the USA market in 2003 and have become the first British consumer-facing website to achieve a serious presence in the USA market.
That business is now a top 20 USA travel site and, despite the weak dollar, accounts for nearly half of our overall sales.
Here are my 10 top tips:
1) Stick to the knitting: we did not try to diversify but rather built a USA website that was similar to our tried and tested Cheapflights.co.uk
2) Adapt quickly to local customs: we changed the navigation system and much of the verbiage when it became clear that USA travellers had no idea for example what a “return flight” means
3) Start cheap: we launched in a serviced office in Boston with just three people – we did not bet the family silver on success
4) Hire qualified staff: we sent over our Vice Chairman and product supreme Hugo Burge who knows our business intimately. After three years, Hugo recruited top USA internet executive Michael Bennett from internet behemoth Monster.com to take his place.
5) Don’t give up: some of our board and several of our investors said “impossible” as did our first PR company; but we persevered
6) Get yourself a great lawyer. The USA is unbelievably litigious. We immediately hired one of the most aggressive and best known US law firms to act on our behalf.
7) Go native. We located in Boston. So we immediately persuaded Dan Bricklin, a legendary figure in the Massachusetts technology world, to join our USA board. Dan is the inventor of VisiCalc (the first financial spreadsheet) and enjoys enormous respect. As Cheapflights began to grow, we recruited the best of the local talent. Now even our Group Managing Director is American.
8) Think very carefully where you want to be. We opted for Boston. Easy to get to from London. 5 hour time difference. And plenty of local tech talent.
9) Do your homework! We talked to our key partners in the UK, companies like Travelocity and British Airways, and convinced ourselves that the USA was ready for our price comparison publishing platform. We analysed all the other price comparison sites in the USA (not many happily) and established that we had a unique product.
10) Make sure that good financial controls are in place. Our American business is under the constant scrutiny of our long-serving FD.
