American internet start-ups such as Airbnb, Uber and Fab.com are accelerating their efforts to expand internationally, powered by global distribution platforms such as Facebook and Apple’s App Store, in an attempt to thwart copycats in Europe and elsewhere.
The size and scale of the U.S. historically meant large tech companies could be built without looking outside their domestic market. Now, entrepreneurs running companies barely a year old are going global—having learnt lessons from the likes of Groupon, which paid about $100-million in 2010 to acquire MyCityDeal, a year-old “clone” created by the Samwer brothers of Germany, who went on to run its international business.
Airbnb, the peer-to-peer home rental site, saw the Samwers’ launch rival Wimdu in Europe last year. But the U.S. site wasted little time in establishing European operations, partly through acquisitions in the U.K. and Germany.
Brian Chesky, chief executive of Airbnb, said its latest milestone of 10-million nights booked represented a “widening gap” between the site and its clone rivals. “A year ago, we saw a number of people come on the scene. Since then we’ve seen a huge distancing,” he said. “At the end of the day, we don’t look at the rear-view mirror. We look at the road ahead.”
Following a similar pattern, Fab.com, a designer homewares site launched in the U.S. just a year ago, has already started selling in 20 countries and on Tuesday acquired LLUSTRE, a British design store. Fab.com, which bought Casacanda in Germany in February, paid about $8-million for LLUSTRE, according to people familiar with the deal, despite Fab.com being operational for just a few months.
Jason Goldberg, chief executive of Fab.com, said he wanted to build the site into an international franchise that would last as long as Ikea or Apple. “The great brands of the world are global brands that represent the same thing all over the world,” he said. “To achieve that we had to think globally from the very beginning. We definitely went to Europe faster than most ecommerce companies. . . That is partly a product of the times where there are so many copycats.”
Zach Sims, chief executive of Codeacademy, a 10-month-old programming education site that has just raised $10-million in funding led by Index Ventures, said cloning was “something you worry about” and prompted a global expansion strategy “sooner rather than later”—along with half its users being already from outside the U.S. “It’s supporting what our users are already doing,” he said.
Fab.com and Codeacademy—along with fellow U.S. start-ups Uber, a taxi hire app and Box.com, a storage site—chose this week’s Le Web event to announce their international expansion. Le Web, run by Loic LeMeur, a French entrepreneur based in San Francisco, is being held in London for the first time after several years of attracting Silicon Valley big hitters to its Paris events.
Uber has just launched in London and hired a European executive, Kees Koolen, as its chief operating officer “to help us go global,” said Travis Kalanick, the taxi service’s founder. “The world is not just about Silicon Valley.”
The traffic is not just one-way. Jay Bregman, chief executive of Hailo, a British rival taxi-ordering app that uses black cabs in London, said European companies were equally keen to grow abroad.
“We are focused on bringing the Hailo experience to as many cities around the world as we can as quickly as we can,” he said.
Brent Hoberman, internet investor at PROFounders Capital and a British dotcom veteran, said avoiding copycats was important to the development of the European tech ecosystem.
“If you want more Autonomys and $10-billion [deals],” he said, “you are not going to get that by copying someone else’s business and selling out to them.”
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