From $1Billion to $100 Billion: Secrets to Scaling Globally

Okay, welcome to the Default Global Podcast. Today, I have the pleasure of speaking with Klaus Wiehe, a powerhouse in global expansion strategy and co-author of Global Glass, which has been recognized as a go-to guide for building internationally scalable companies. Klaus has helped over 2,000 leaders from more than 50 countries embrace what he calls an entrepreneurial mindset, a concept designed for startups and established companies alike to think globally from the outset. Klaus, it is fantastic to have you here.

Thank you so much, Wit, and I look forward to this discussion. It's going to be very, very exciting to interact with you today. Awesome. Would you like to add anything to that introduction?

Maybe I missed something. Sure. Sure. To obviously the audience out there is most of my career I've been working within the field of global growth and expansion and sort of my past career was being in Vietnam being a part of a market relaunch team for one of the biggest beer brewing companies in the world called Carlsberg and I sort of saw what was happening inside a very large corporate machine in terms of how to do things wrong when it comes to scaling and expanding to new markets in fact back in 2011 they fired the entire team and we came in as a new team and then you know in my sort of like current career here in Silicon Valley for the past like 10 to 11 years my main focus has been helping to support startups that wanted to scale and expand into Silicon Valley primarily but more recently post-publishing the book Global Class we started to do a lot of like strategy advisory for fast-growing companies to scale anywhere in the world and so that's a little bit the context to to my experience of what we do at the company.

That's really awesome And I'm really excited to dive into this idea of building a default global or global first company. You work with so many founders. You've scaled their businesses across continents. So today, I would love for us to unpack the why and how of global first approach, right?

So to kick things off, Carlos, could you maybe give us a sense of the types of clients you work with? I mean, I know that you advise a wide range of companies, But maybe I'm interested specifically in what is the common thread and what they come to you for? Sure. So in sort of like the more the old type of work that we've done has been acceleration programs.

But again, as I mentioned before, since publishing the book, we sort of changed our scope a little bit in the segment that we focus on as well. so now at global class our focus is to help companies grow company valuation from one billion dollars to a hundred billion dollars through management consulting services and in the work since publishing the book we work with one of the leading neobanks in the world we've been working with one of the leading point of sale system providers you know basically the the machines that you pay within retail stores and so forth, and a whole host of other companies that are more in the unicorn-esque type of stage and also later to really help them course correct their international expansion strategy.

What often happens when we engage with companies is that they come to us once they've started and tried to launch in one, two, or three, or four markets, and then realize that they're hitting a wall and can't really take advantage of that opportunity. Because within an organization, once you start to expand, a lot of things happens, basically. When you start to launch a product into a market, you realize it's much harder than expected. You can't just replicate your initial market success internationally.

And when that happens, a lot of misalignment happens within the organization because they haven't really set up the right processes, procedures, etc. to support localization and adaptation of the business model. And once that happens also, because you haven't set the right expectation within the company, trust breaks down and all of a sudden leadership doesn't trust the local team and the local team doesn't feel supported about the leadership team. So our overall goal is to help make sure that there is strong alignment within the company, but then also they have the right processes in place to support market launches, as well as also helping them to understand what are great markets out there based on organizational capabilities and the strategies that are required in those local markets so in you know in some we kind of help companies from organizational alignment to market selection to market support and so forth awesome awesome and i know that a big part of your approach centers around this concept that i mentioned that you have coined as entrepreneurship right Could you explain what it means to be an entrepreneur and why this mindset is so crucial for companies looking to scale globally?

Sure. So we regard that one of the most important things if you want to build a global company is that you foster the right mindset within an organization. And so when we were doing research for the book, Global Class, we sort of uncovered a little bit of a common trait and mindset within the leaders that we interviewed. Just for context, we interviewed 400 executives from the fastest growing companies in the world to identify patterns of success and failure.

But when it comes to the mindset, we often found that those that were most successful in their roles, they often had formative experiences in their past, in their early 20s and so forth, that shaped the worldview and also led them to get into these roles. For example, the head of international Zoom, he was an English teacher in a rural fishing village in Fukushima, Japan. And the guy that led expansion for Evernote, he was a missionary for two years in Korea. And so they had this unique worldview and this cultural sensitivity that enabled them to be successful in the role.

And so going to the concept of entrepreneurship, we think of it as a pyramid and three types of mindsets. And at the bottom, we have the agile mindset, people who are iterative, resilient, growth-focused. But then you also need to have a company mindset, being able to navigate bureaucracy, building coalition and buying within an organization to get support for your initiatives. But then the often overlooked mindset, as we regard it, is the cultural mindset, global mindedness, cultural curiosity that allows them to really understand cultural differences and guide a company on the needed strategy for that market because you need to adapt it based on the culture and regulatory context So that a little bit the concept that we talk about And so you need to foster this within your organization, both at the company level, but also as you hire local teams as well at new markets.

Yeah, you know, I also had this privilege of helping over like 100 plus global first entrepreneurs, executives from like a Zillow, GitHub, and dozens of other early stage founders to hire like a talent globally, to expand globally. But for me, it's clear that building a team across borders unlocks doors that just aren't possible with a single market approach, right? But it's not only about hiring, in fact, right? It's about like accessing expertise, exploring new markets, discovering unique opportunities for expansion, for fundraising, and so on and so on.

So maybe, can you maybe give us, you mentioned that you interviewed 400 executive founders. Can you maybe share some standout success stories, maybe specifically for startups that have expanded globally? But yeah, the most successful one, I guess. Sure.

One example, just to mention this one, is BlaBlaCar in France. they've scaled across Europe, but also even in Latin America and so forth. But I particularly like the concept that Frederick Massala, the co-founder of Blablacar, told us about, which is a concept called building for two markets. In the onset, in the very beginning, Blablacar, when they built the company, it was called Cuvotourage, which is very French, and I'm probably butchering the name as well.

but as he had the aspiration of building Blabakar, he wanted to build a global company and he sort of quickly realized that thinking in a very local manner, even with the name and brand, would prohibit and limit his ability to grow successfully internationally. So he reframed the way he thought about the business and this concept of building for two markets that then led in terms of impacting how they thought about building the product, how they thought about building the culture and overall organization within Blabacar.

And how was this sort of reflected in terms of talent, for example, was that he knew that they needed to expand internationally in the future because, as you know, Blabacar is a long-distance carpooling platform. So by nature, you're not going to have a lot of scalability just within France. You're going to have to go to new markets. And so one of the markets were Spain.

and as you were thinking about building for two markets he had spain in mind so already in the beginning he started to think about hiring spanish-speaking talent from spain right brought them into the organization even brought some of them to the headquarter uh in in france so they learned about the inner workings of the organization of the culture but also they learned about the spanish culture at the same time so when they were then they were prepared to launch in spain and start to pursue the market, they had talent that understood the market and understood the company culture and so forth.

So when you think about hiring global talent, it benefits you as an organization to be much more ready for global markets, let alone being able to pursue and actually launch in new markets. So it's really important to kind of diversify the pool of talent within the organization. And so hiring internationally, when you think about building a distributed workforce, you can also be very strategic about thinking about the markets that you think could be potential down the road as well and that can essentially help you accelerate growth in new markets down the road yeah that's that's that's very good example uh very cool one and in fact like in my experience this strategy is super powerful and even like for large companies for uh unicorns and for early stage startups like who are looking to do more business.

For example, when we started Globally, we couldn't afford certain high demand skills in our local market. But hiring and then selling Globally opened up access to experts, connections, expertise that we couldn't have dreamed of getting otherwise. So that's so cool. Okay, so another thing.

And also notice that global teams can bring new ideas to your company. And like you mentioned, it might help you with expansion, but also it might help you with your local market as well. Like maybe give some perspectives that push a company forward, right? So, for instance, founders I've spoken with often discover like entirely new applications or customer segments through feedback from their international team members, right?

So have you seen examples like that where global teams drive innovation that reshapes a company's core product or strategy? Yes, for sure. 100%. The way that we like to sort of talk about it, and it's also mentioned in the book, is in the concept of two-way innovation, right?

Innovation is not just pushed to the edges of the organization, pushed into new markets. But if you structure things in the right way in terms of management and granting autonomy to local teams, you can also learn a lot of key insights that strengthen your ability to innovate as an organization and deliver better products and services to the broader you know, customer base that you have. And so like a very simple example that will probably resonate with your audience as well is Slack as an example.

When they were launching in multiple markets, one market were Japan. And they started to obviously get a lot of user feedbacks from customers in Japan that were feeling that there was a little bit of friction on the platform. Because back in the early days, a slack didn't have a send button and you just used to enter like on the keyboard and in japan the users accidentally send the messages too early because culturally they are not accustomed to this short messaging text messaging whatsapping or whatever you want to call it in japan so they instead they actually like to concoct more longer messages with paragraphs and everything and so by the mere fact of them sending it too early it made them very uncomfortable in Japan because it would have them seem to be less professional in the colder context of Japan And so with those complaints and that feedback they started to think about okay do we need to add an extra layer of sending to the platform And this was actually a huge debate with Slack because they were all about speed of communication and that was part of their core values.

And so making that decision was actually a quite big of a middle hurdle for the team. but they actually ended up deciding to add the send button as a feature that you could choose to opt into on Slack. So the point being is that once your product launches in your markets, you get a lot of feedback and insights that then enable you to innovate a little bit. And granted, of course, a send button is not hugely innovative, but it actually ended up being a standard feature on the platform worldwide, essentially.

So I think what oftentimes is the missed opportunity for most organizations is that you're not actively pursuing to learn from new markets when you launch in multiple markets. That curiosity is not really there oftentimes from sort of the headquarter side, whereas local market teams, they're obviously actively learning about these things and they're trying to advocate it back to the headquarter. So I think setting that alignment structure within the company is really, really key, in my opinion, to actively learn about how you can innovate on the business side of things, the product or whatever that is.

Yeah, that's another good example. Frank speaking, I didn't know about that. And Frank speaking, I had the same issue with LinkedIn and they, I guess, did that the same as Slack, like you mentioned. that's actually a great example LinkedIn because also if you think about it one of the things that they also changed for LinkedIn I believe that was in Japan but please don't quote me publicly on it but obviously it'll be here on the video but I believe they changed at least for Japan I believe they changed the amount of words you could write in the connect request because again more information is often required right also when you talk about like changing the way you enter into a market.

LinkedIn is an interesting story also for Japan because in Japan, the whole hiring didn't really resonate as a value proposition because in Japan, you stay at the company for like 20, 30, 40 years, whereas in Silicon Valley, we change jobs every second year. So instead, I actually focused on getting better at your current job and then positioning the learning and development tools in front of the platform instead of the hiring tools in Japan, right? So adapting your value proposition, adapting your product and services, you know, is something you might consider when you launch it in your markets.

Right, right. One of the unique challenges of a global team is obviously, and you mentioned this, scaling culture and process across different regions, right? And I know you're a big advocate of creating what you call this scalable culture, right? That feels unified regardless of location.

So what are some strategies founders can use to create that cultural foundation, right? As they grow internationally? Yeah, so again, what we often talk about to our clients and customers or whatever that is, is when you want to build a global company, you, again, need to seek to learn and understand your markets and that not just from customers, but also from employees as well. And so you may have very well-defined core values and culture as an organization.

But in our opinion, you need to seek to kind of universalize those core values as well, right? Because they may not resonate with that local employee base. A little example that we mention oftentimes is Walmart that had a core value of respecting the individual, but respecting the individual may not resonate in many Asian countries where it's more about the collective. Another example that actually resonated a lot for Slack in Japan was the word craftsmanship.

That was a core value that resonated a lot with the employee base in Japan. So when you go to new markets, you may need to tweak your core values in the way you're messaging it, or you may lean on certain core values that resonates more with local employees. And that's the way that we believe is the most effective way to kind of scale a culture. Another thing that we share in the book is Rakuten.

When they expanded internationally, one of the really great stories that I liked, which is one of the co-founders of Rakuten that shared with us, was when they expanded to the UK, for example, they had a lot of cultural conflicts happening. Because when they were expanding, they were doing M&A, they were acquiring other companies. and as you know once an acquisition happens a lot of like mistrust happens very quickly what are they going to do with us here in this marketplace and a lot of frictions were happening within the london headquarter but what they actually did very well in that scenario was they traveled over to the uk they wanted to learn from the employee base there in the office and so the chief well-being officer, also the co-founder, he came and actually wanted to do this town hall setting.

And he asked him, what matters to you? What are your core values? What do you believe in? All these questions and drew it up on a whiteboard at the office.

And then afterwards, which I found was very interesting, was that he then, you know, draw parallels and alignment with Rakuten's core values, right? So you try to learn from them first and try to bridge that with also the core values of Rakuten. So being very intentional around how you interact, interface with the employee base in another country, I think is a useful strategy when you want to scale the culture. Yeah, yeah, yeah.

I completely understand what you're talking about. unfortunately for uh small companies like like for example goby we we don't have like many like uh uh this you know opportunities to go like it to we have teams in seven different countries on three different continents right so it's a bit hard to go like that but still like uh when we scaled goby uh building trust was essential for me i had to create a sense of unity and shared vision across people who might never meet in person never meet in person you know Yes So that another challenge for early stage companies small companies I guess And it is super hard when you're a naturally distributed organization from the get-go, right?

How do you build that alignment? How do you strengthen the culture? And part of it is obviously defining that, but part of it is also hiring the right people that contributes to the culture as well, right? So there's different things that you need to consider.

Right. And another thing, like, I guess, imagine that communication and what you mentioned, this cultural adaptability become crucial as well, right? Like you mentioned in Global Glass, you talk about this importance of cultural curiosity, right? So from your experience, what qualities should founders look for to ensure their team members can thrive in a cross-cultural environment?

Totally. I think, again, part of it is not assuming all the time. Part of it is not leaning into your biases. And most importantly, you need to seek to learn all the time in terms of how people think from other cultures as well.

And so we oftentimes, with employees, let's say, for example, in the Philippines, we try to understand why is this a certain way of interacting or behaving, etc.? Instead of we actually just have a biased sort of thinking around it. There might be a cultural nuance to certain things in terms of how you communicate, how you provide guidance, how you organize, how you direct, etc. So you have to constantly adapt your way of managing employees based on what cultural context that they're also from.

And so I think that's one of the most challenging things in terms of continuously learning and adapting your management approach, what we call cultural conscious management in the book. And it's really a difficult skill, to be honest, which a lot of leaders struggle with. Yeah. Okay.

So, Klaus, let's look to the future. As someone on the front lines of this global shift, what trends are you seeing that make this the perfect time for companies, maybe for early stage startups, startups or just companies, middle enterprise level, I don't know, to adopt a global first strategy? i mean i think one of the biggest trends to to me is is just the talent availability around the world i think now that education has by and large been uh democratized in terms of like entrepreneurship and so forth right i think there's a unique advantage in tapping into you know workforce all around the world and which we uh certainly believe in right i i i don't believe as much in the legacy way of building a company where you just build and scale within the vicinity of your office and let's say from copenhagen where i'm from or in san francisco where i'm at i i don't think it's the right way to building an organization i think you need to build a very diverse uh you know talent base that enables you to not just build a great company in your local market but also enable the future growth of your organization and so i'm a true believer that you know tapping into international talent tapping into other deals should be imperative for any organization around the world at this point i think otherwise of course if you if you don't have global aspirations you could go ahead and do your local you know company building but if in the future you have global aspiration you should actually do it from the very onset building that into the fabric of your organization right and probably my last question um if there is one piece of advice you could give to a founder considering a global first approach what would it be that's a great question um i think it is um i think it's essentially for founders to want to do it is is be intentional about doing it and by intentional i also mean about around what you do you know for yourself as a founder a great story i like to share is i don't know if the audience know a company called sendbird but it's a highly successful company in the bay area the founder is korean and he came to the bay area and one of the things that he told himself was that he wants to make sure that he builds a global company.

And so even what he did for himself to foster that mindset, I found to be, it was very simple, but very powerful, right? So he was from Korea. He thought Korean and everything, but he said, okay, great. In order for me to build a global company, I need to start with me first.

And so I'm going to think about what type of media I consume. I'm not just going to consume Korean media. I'm going to think about how I communicate, meaning he changed his Korean keyboard to an English keyboard, so it forced him to communicate in English. And also, when I build a company, I want to make sure that everyone within my organization understand the basics of me wanting to build a global company.

What happened oftentimes when he interfaced with employees was that when he asked for benchmarks in terms of competitors, they came with Korean competitors. and he said, I don't want to see any Korean competition. I want to see global competition because that's the benchmark I want to have as a leader. And so intentionality around how you do that, let alone also intentionality and how you think about hiring people into your organization and then also fostering a global culture is absolutely key to be successful in scaling a globally minded business.

Awesome. Thank you very much for sharing your insights with us today. I think this conversation really highlights how a global-first approach can be, I guess, unbeatable advantage for startups and for companies, right? Not just for accessing talent, but also for unlocking entirely new opportunities, whether it's market insights, fundraising, or even building culture of innovation.

Klaus, it's been a pleasure having you here.