1.2 Companies on the Move:

CLICK HERE FOR COMPANIES ON THE MOVE

For the past 4 years, we've published information about companies on the move in our monthly report.  No more.  Now you can publish and view that information instantly on our web log (blog)!  To view, click on http://netsudsannounce.blogspot.com/.

Why email only to your small email list of associates when you can post this information on the blog and have 5000+ NetSudsers view it.  To publish to the blog send me an email requesting permission.  You may have to create your blog account at www.blogger.com.  After you have an account, you can post to the blog as much as you want.  You need only follow some common sense guidelines, e.g. don't post every press release, don't post sales information, don't post defamatory statements, etc.  If you "spam" the blog, you will be removed.

If you'd rather have me to post your information to the blog, just email me at cotm@netsuds.com.  You can report (1) the formation of a new start-up, (2) momentum change at an existing company, (3) addition of key hires, or (4) a funding event.  We do not accept press release changes from third parties.  We must hear directly from an executive at the company which is 'on the move'.

You can also try our online calendar by clicking here for NetSuds and here for MedicalSuds.

4.1 NetSuds on Tour

NetSuds loves on-site tours!  Email me if you want to show off your company.  I can be reached at matt@netsuds.com. 

4.1.1  No Tours in November

4.2  Email Advertising

The Business Journal reported that their daily email news reaches 5200+ Twin Cities executives.  The MHTA claims a little over 2000 people on their email list.  Not bad but still a great deal less than the NetSuds and MedicalSuds email lists which reach 7600+.  The NetSuds email lists are double-opt-in and concentrated on professionals in the communications, IT and Internet markets.  The MedicalSuds email lists are double-opt-in and concentrated on professionals in the medtech, biotech and life sciences markets.  So, rather than spend your advertising dollars on any other email lists in the Twin Cities, consider the NetSuds and MedicalSuds lists.  Contact matt@netsuds.com or 612.605.5252.  For current ad rates, visit www.netsuds.com/adrates.htm.

6.0  Storage Networking Buzz

by NetSudser Graeme Thickins, graeme@thickins.com

This is a collection of observations for clients and friends from "Storage Networking World," held October 27-30, 2003,
at the JW Marriott Grande Lakes Resort, Orlando, Florida.

Good news: it was an upbeat tech event!  Even more upbeat than expected, many sources told me.

It was the largest ever, this ninth SNW (an event held twice a year), with some 2500 registered.  It featured 109 sponsors and exhibitors -- "Virtually the entire industry," said a breathless Ron Milton, EVP of Computerworld, in his opening remarks.

The event had 115 scheduled sessions with 122 speakers. The exhibit area again featured an Interoperability Lab (orananized by cosponsor SNIA), this time featuring 8 themes, 39 vendors, and 25 demos -- with the major buzz being the developing new SMI-S standard.

Though it's likely that 50% or more of attendees were from vendor companies, including sponsors and exhibitors [and the total count probably included the busboys and janitors] estimates were that something approaching 1000 were real users -- also a record, officials said.

The mood was upbeat, and as analyst Mike Karp said, at least it shows *travel* budgets are easing, if not more.  Press and analysts surely numbered in excess than 100, and reporters I spoke with, such as Evan Koblentz of eWeek and Deni Connor of Network World, said it was a big news event.

Just how upbeat was the mood?  Well, I heard the festivities on Wednesday evening included hand-rolled cigars for all.  Sound
familiar to you tech conference vets out there?  Shades of the good old days....anyone remember Boca, spring 2000?

The first audience keypad response in the general sessions brought a bit of a surprise. When asked what their company size was, 23% of attendees said $1-10 billion in revs, and 29% said $10 billion+.  Surprisingly, the big companies were out in force.  So, maybe it won't be just the "SMBs" that are spending going forward??  (One reason may be a statistic mentioned below by the CEO of Quantum.)

So, herewith is a recap of my notes from the key sessions I attended.  These observations (admittedly assuming some knowledge of the storage business) are in chronological order from the opening bell of the general sessions on Tuesday morning, October 28th.  And I close with forecasts of what lies ahead, according to several leading industry watchers.

Major General Dale Meyerrose, CIO and Director of Architecture & Integration US Air Force, US Northern Command:

Advice to IT execs from this keynote speaker... "Think big, start small, scale fast."

A piece of wisdom he offered regarding working with vendors: "You can't buy an answer, you must develop a solution."

"Maybe this should be a data-action conference instead of a storage-networking conference."

Another keynoter, Jerry McElhatton, President, Mastercard Operations:

"Transforming data into information is what makes your company smart."

"We transfer $6 billion between banks on an average day, and have 320 terabytes of online storage (up from 68 terabytes
in 1999)."

Mark Canepa, EVP, Network Storage Products Group, Sun:

"Customers are increasingly saying, 'this is too complex'."

"In '95-'00, we were in the age of connectivity, now in '03 we're in the age of efficiency.  By 2005, we'll be entering the age of data services."

From a chart he showed called "Next-Generation Data Services"....it had "Content" at the top, with Storage, Compute, and Network below it and feeding in.

Comments from the "User Executive Roundtable":

- Steve Duplessie, ESG: "You *all* will soon be in a regulated, record-retention environment."

- John Kelley, CEO, McData: "Business continuity and disaster recovery is pre-eminent in *everyone's* mind."

- Duplessie: "9/11 caused a lot of talk about disaster recovery, but few did anything."

- Kelley (when asked, "What about interoperability?"): "Applications will drive it.  The Homeland Security effect is coming. It could be a driver of interop."

- Christine Wallis, SVP, Hitachi Data Systems: "Problems get solved when the real pain is there. I think we're there now in storage."

- Duplessie: "How do you separate the noise?"

- Mike Luter, CTO, Cancer Therapy & Research Center: "It's no longer about 'customer relationship.'  Now, it has to be a *partnership* -- an alliance or trust."

One audience question afterward: "Is HBA pricing coming down?"

- Duplessie:  "It'll be cut in half in 18 months!"

Cisco's "User Case Study"...comments from Lance Perry, VP, IT Infrastructure:

"We currently manage 1.6 petapytes of raw storage, about 1.1 of which is DAS/SAN...and storage has been more than 50% of our IT budget."

"Data center space is at a premium...Underutilization of storage is a problem, even at Cisco, creating enormous ROI potential."

"Industry averages for utilization are only 40% for DAS, 60% for NAS, and 85% for SAN."

"Cisco is focusing on a consolidated storage utility... Our vision is offering storage as a utility-like service...which has a significant ROI and lower TCO."

"We formed a dedicated storage team in early 2002, and went global with it a few months later."

"Our storage TCO has been about .10 per megabyte, for DAS and small SAN island architectures, and .05 for NAS...but we're out to drop that by 20% per year through improved utilization."

From a presentation by Rick Belluzzo, CEO of Quantum, on "New Imperatives in Data Protection":

"This is the most exciting part of storage."

"We're in a period of transition...I believe the industry fell behind in the last 5-10 years in data protection, and we're now at an inflection point....tape and disk will overlap."

"I see two key challenges:  data growth averaging 50-75% a year, with email at 90%, and aging IT infrastructure -- an average of 3.5 years, which is the highest since 1986."

"There are now more than 4000 regulations covering record retention...and don't forget -- they don't just require retention, but the ability to quickly *recover", too."

Discussion from the SMI-S panel, "Next Steps to Deployment" (SMI-S is the SNIA's energing standard, "Storage Management Initiative Specification"):

- Richie Lary, Storage Guru & Consultant: "With no standards, customers judge a vendor by its weakest link.  With standards,
they buy your strongest piece."

- Lary: "What is SMI-S? Basically, it's managed objects."

- John Blackman, Technology Strategist & Architect, Wells Fargo: "Our storage environment has more than 20 different vendors, and mutiple 'people factions' internally. What SMI-S means to us is better use of people...API-swapping did us no good -- it kluged things further, made it harder."

- Marty LeFebvre, VP-Technology Strategy, Nielsen Media Research: "It means we can focus more on managing storage --
not on all the various tools.  Different people have to know all the different tools."

- Blackman: "SMI-S helps startups, because it allows customers to drop in their solutions. It's about data center simplification --
that's what we're trying to do."

- Audience question: "What about vendor differentiation? Doesn't this standard just reduce everything to the lowest common denominator?"

- Lary: "We left room for differentiation. That's something we planned for."

- Blackman: "Differentiation comes from service and customer focus."

- Moderator (John Webster, Founder, Data Mobility Group): "Don't developers have a big advantage writing to fewer APIs -- less cost and support?"

- Lary: "The cost is high to develop custom, nonstandard storage management software -- a hundred thouasnd lines of code just to get started!  SMI-S opens it up to a whole bunch more companies, at the lower end of the market, too."

- Blackman: "It goes beyond storage, into the server."

- Lary: "There are at least three companies now with SMI-S frameworks, one of them open source...SMI-S is now moving from the concept of 'interoperability' -- where if and A and B don't work together, it's nobody's fault -- to 'compliance'.  And that puts the real onus on each vendor."

- Moderator question: "What can users do to make sure SMI-S happens?"

- LeFebvre: "Tell the vendors. Make it part of your vendor selection/evaluation process...Storage user groups are now growing around the world."

- Blackman: "Users are the only way this is going to happen."

- Lary: "Some companies I know are placing big bets on SMI-S products. Meaning products that only work with SMI-S."

Factoid:  One of many audience-keypad questions yielded this result: 34% are not currently doing any mirroring at all.

A break for a news conference....wherein Invio Software was announcing its "Storage Practice Manager," which is the first process management software to provide storage on demand, according to the company. Not another policy engine, they say, it "fits management workflow to the organization," and removes repetitive tasks from the administrator's workload. The next day, a storage manager from Hudson's Bay Company presented his firm's results using the product (which unfortunately I missed, as I was climbing onto a plane).  Chris Hyrne, VP marketing, told me later that "It was encouraging to see the 'light go on' in so many faces about the impact of improving process in storage operations like provisioning and ILM."  That latter term, for those of you living under a rock, is Information Lifecyle Management...which wins my overused buzzphrase award -- it was *everywhere* at SNW.

My notes from the 3-hour-plus IDC Briefing Wednesday morning, "The State of the Storage Market, 2004 and Beyond":  

- Robert Gray, IDC Research VP, Storage Systems: "Budgets are up....In our latest survey, 55% of companies said their spending would increase. Only 26% said their budgets were down." (a marked difference from IDC's previous surveys)

"Storage hardware investment will be slower, but software investment will be up in 2004."

"The strongest markets for storage companies look to be countries like China, Australia, and India -- where spending will be up in the range of 80%."

"Data protection, including rapid restoration and disaster tolerance projects, are finally on the front burner."

"Time to restoration is clearly a driver in 2004. Companies will be buying fewer tape drives."

"Everyone now classifies their data by how fast it must be recovered."

- Charlotte Rancourt, IDC Storage Systems Research Director:

"The largest opportunities are in software and services. Hardware CAGR will be less than 4%."

"Spending in the U.S. is definitely increasing, and is the beginning of a wave of increase globally."

"Storage spending increased 1.9% in 2003 over 2002.  That may not sound like much, but consider the two previous years, when spending was *down* 15 and 23%."

"IT managers are really service providers, and their clients are getting even more demanding. They need *data* and often their pay is tied to performance. They don't care about IT pain."

"On the other side is the boss. He doesn't care about IT wizardry. He just wants to stay flexible enough to address things like headcount reductions or increases and other business imperatives."

"What customers need today is threefold: reduced costs, increased quality of service, and to match the data delivery method with the value of the information."

"All data is not created equal. The IT manager's job is basically managing a huge inventory of data -- data with varied access, value and importance."

"What's needed is a 'tiered storage solution' -- which is really a data inventory strategy."  "That's always been done with storage arrays, with different capacity and speed drives. Now, whole arrays are designed for specific performance."

"These may be lower cost arrays, but they're revenue opportunities nonetheless."

"We see it as a services-led opportunity, partnering with the customer....The tiered-storage opportunity is not about hardware, but a services-led customer solution."

"It may sound simple, but it's quite complex.... It has been done in the mainframe environment."

"New opportunities for arrays include disk-to-disk-to-tape and online storage of fixed content."

"Things vendors should do: (1) disrupt yourselves now: low-cost drives will be part of arrays -- if you don't have them, you're late; (2) integrate your competitors' products into your platform; and (3) leverage your internal consulting expertise."
 

- Rick Villars, IDC VP Storage Systems: "Storage networking is the fastest-growing portion of the storage market...By 2005, SAN storage spending will be as much as *all* storage was in 2003."

"But the network buildout is still at an early stage. Networked storage is going network."

"Capacity-oriented storage arrays, like NetApp's NearStor, are reshaping the storage environment.  By 2007, they will be 40% of all storage."

"With low-cost storage, customers also want low-cost connections. One exmaple is the 'no-frills switch'.  Products like QLogic's Stackable Switch, which offers an expandable-port, stackable environment, are a trend."

"In the director switch category, the focus is on port density, and easier manageability."

"The iSCSI opportunity will initially be in the server world, then storage. By 2005, we'll see a convergence inside arrays of internal and external architectures."

"Nobody's budgeting for 'virtualization' per se, but they are for managing storage and data protection."

"What's coming is 'inter-SANs', not bigger SANs.  Think routing -- like what happened when so many LANs were proliferating. It's 'internetworking'."

"Trends to watch include embedded fibre channel (internal/external convergence), 4G fibre channel, iSCSI, and network storage controllers."

"There will be expanded use of FC technologies within array and server architectures...including opportunities at both the chip and system level, such as 'fibre down' and embedded switches. But can you be in both the chip and systems business? The latter is more customer focused. These are two worlds, with different needs and requirements."

"The reality is that the market is moving to 4G FC, with first products by 2005. It's driven by the value the customer perceives, exactly like the 1 to 2G transition."

"iSCSI adoption was slowed by Microsoft's delays in getting testing kits out.  Delivery of products was slowed, but customer interest is still there....We'll see it first in stranded servers, iSCSI to FC."

"The 'networked storage controller' market (IDC's term for blade switches) is being driven by data migration, replication, and storage consolidation...We advise customers to focus on the tactical before moving to grand visions like Information Lifecycle Management."

"But there are questions of how to take this to market -- the type of product and format. The industry hasn't answered those questions yet. So, path to market is a major issue."

"We recommend that vendors stay serious about cost management. Plan for $200 per port by 2007. Think Ethernet trends ....We're bringing routing to SANs... But the biggest hurdle remains -- interoperability."

"Redirect your partner strategies. The new opportunities are less interesting to traditional partners. Go to the software and services people in your existing partner companies. And establish relationships with resellers and integrators."  

- Bill North, IDC Program Director, Storage Software: "We're seeing all the signs of a maturing market in storage software. The market dynamics have been hectic lately, with many acquisitions and mergers."

"One thing blade servers do is compress the number of software licenses."

"Intelligent storage networks are changing the way to think about where management should be."

"We're seeing data protection and disaster recovery being re-emphasized...And for fixed content, low-performance, capacity-optimized solutions have arrived...New hardware suggests new software requirements."

"Serious challenges remain before Information Lifecycle Management can be implemented. The first one is the classification of data....It's an incredibly complex problem, but a laudable goal."

"There's significant interest in policy-based storage automation, from companies of all sizes. But the large companies are the first to do it."

"Storage software will see a 8.7% CAGR from 2002 to 2007, with the highest growth in the storage resource manangement category. Overall market size will grow from $5.7 billion in 2002 to $8.7 billion in 2007."

"More price competition is coming."

"Seven vendors control 75% of this market."

"In Q1 of 2003, storage software was down 8%. But in Q2, it was up 7.3%. For the full year 2003, we're forecasting $6.04 billion, which is up 5.2% over 2002."  The largest segment is backup and archiving, which accounts for 44% of the total."

"All segments are up in 2003. And new segmnets like fixed content and content-addressable storage are driving more market growth."

"The prospects for 2004?  Much more growth."  

- Doug Chandler, IDC Program Director, Storage and Data Management Services: "My presentation is about 'Storage as a Service' -- or when customers don't want to buy or manage products anymore."

"I use the term 'storage utility', but there are many terms being thrown around. Basically, my definition is when a customer has an agreement with a suuplier for storage capacity at a price per megagbyte."

"In surveys about outsourcing, storage management is typically near the top. It was number-three in our recent survey."

"The early adopters of storage as a service are the largest customers. But the greatest benefit may be in the small to midsized category, the SMBs."

"They're the least equipped to manage IT infrastructure, and they're not going to build it internally. They're already outsourcing -- for their web site, for example.  And the costs savings mean they get access to apps they could not otherwise afford. For them, storage as as a utility is generally delivered as part of a larger services suite."

"How big is this market? About 1000 terabytes are currently being delivered this way, where the provider owns the storage. Often, it's sold as part of web hosting.  We estimate the market size now at $250 million."

"Look for activity further down the retail chain -- from players such as Yahoo, eBay, brokers, cable companies, HMOs, Kodak, banks, credit card companies, and more.  All these companies will need help from infrastructure firms."

"Who is delivering this to the marketplace?  The big IT 'utility engines' are of course IBM, EDS, and CSC.  But, for SMBs, we're seeing 'utility aggregators' as a developing trend. Firms like ADP and eBay, as well as VARs. But it also could be Microsoft, GE, Dell, the cable companies, even the telcos. The latter have been attempting IT services plays for a long time, with not a great record."

"Key inhibitors in this market are insource inertia, the culture/political agenda, fear of single-vendor lockin, data privacy and security, and suppliers don't see a future in the 'brand-agnostic' IT utility model (i.e., commoditization).  Another one is the service provider's ability to scale."

"Our recommendations for storage technology firms is to be 'arms providers' to the storage utility providers.   For the providers, the outsourcers, leverage your ability to scale and manage heterogeneity. And look out -- there will be a price war.  For the channels, look for packages
you can sell to SMBs."  

Questions from the audience at the close of the IDC Briefing:

Q (mine): How does IDC account for software delivered in a box -- the trend toward more all-in-one appliances?

A (Bill North): I account for the software portion in my software numbers, and the value of the hardware is tracked by that analyst.

Q (mine): How can customers get started in 'storage as a utility'?

A (Doug Chandler): For big companies like Mobil, they can do a pilot with an entire business -- which they did with Mobil Travel Services. For smaller companies, doing a pilot isn't as easy. They don't know how to do it.

Q (me again): So, does it fall then to the storage utility providers have to teach them?

A (Chandler): Well, yes.

Q: Is there a coming commoditization of HBAs?

A (Rick Villars): The Windows distribution model changes things. iSCSI is more price competitive today.  But the big thing is HBAs is that they'll be embedded.  And the differentiation in HBAs is now the drivers... We're also seeing a sense of commoditization in NAS. But vendors are trying to delay that in the mid and high end."

Companies and people I met with...

Among the storage networking firms I had a chance to catch up with at the show included CNT, Compellent, Hitachi Data Systems, JNI, Revivio, QLogic, Tidalwire/Network Engines, and XIOtech.  I also chatted with several storage industry analysts and other contacts, including colleagues Steve Duplessie and Jon Toigo, each of whom moderated panels that were special highlights of the event.

One other footnote: at the opening reception Monday night, the first three people I met were from Minnesota, my main homebase -- a storage stronghold that was well represented at this conference. Several players from other favorite place, Southern California, made the cross-country trip as well.

I hope this sharing of my notes was valuable for you. It's always great to get feedback from my colleagues and friends, so please do let me know your reactions and questions.

kind regards,
Graeme Thickins
Technology Writer & Analyst
*Minneapolis  *San Clemente

Storage  |  Utility Computing  |  VC  |  IT Trends  

See some of my recent work here:  http://www.gtamarketing.com/GraemeThickins.html

7.0  Somebody's Going To Monopolize Your Marketplace ... Will It Be You?

by NetSudser David Hackbart, dhackbart@y2marketing.com

Question:  What is Marketing Supposed to do?

Answer:  Facilitate your Prospects Decision Making Process by Building a Case and Then Backing it With Evidence. 

Are you ready to implement a marketing system that combines a well thought out and researched case for your company, with articulated compelling marketing and advertising pieces that your prospects will notice and respond to? - Marketing that supports your case and leads your prospects to this conclusion: “I would have to be a fool to do business with anyone else but you”. If you don’t, one of your competitors will.

Lifeblood of Your Business… 

Advertising and marketing are the lifeblood of your business. Don’t treat them lightly and hand them off to someone who’s more concerned about their ego than your bottom line. Your advertising and marketing have the potential to impact your business—for better or for worse—more than any other aspect of your business.  

Think about it. Let's say you place an ad that costs $2,500.  That ad is going to cost you the exact same amount of money whether it generates $100 of business, $1,000 of business, $10,000 of business, or 10 times that. The investment is identical! You spend the same money for potentially vastly different results. Now, if you can get the results up, you've just massively leveraged your ad dollars. No other part of your business offers that kind of leverage, only advertising and marketing. 

Competition Has Increased... 

The landscape of business has changed over the last 5 to 20 years.  Just being aggressive doesn’t cut it anymore.  Sales skills alone aren’t enough.  You’ve got to distinguish your business from the competition and lead prospects to say, “I would have to be an absolute fool to do business with anyone else but you...regardless of price.” 

Most of the advice you read and hear from the so-called marketing experts is wrong. The old strategies don’t work. In order to grow in today’s marketplace you need to understand the new marketing paradigm. It doesn’t matter if you’re selling retail, wholesale, or business-to-business. Increased competition and information created this new paradigm, which causes confusion in the marketplace. Consumers and businesses distrust most of what you say in your sales & marketing efforts. It’s not that they don’t trust you; it’s just that they don’t give any credence to what you say.

Advantage: Innovators & Marketers… 

This situation leaves a huge advantage for companies who know how to build a better business… and who know how to integrate the right kind of marketing throughout their sales system. Peter Drucker said, “Business has just two functions, and only two, marketing and innovation. Marketing and innovation make money; everything else is a cost.” 

If You Want To Distinguish Your Business From The Competition, Build A Case Like An Attorney Does… 

Your business is on trial. Your customers and prospects are the jury. You’re the attorney and it’s a life or death sentence. What will you say that will convince them to buy from you? What kind of evidence can you produce to PROVE beyond any reasonable doubt that they’d be a fool not to buy from you? You can gain control over the competition with a well-developed case. Without this “case,” your product or service becomes a commodity, and purchasing decisions are then made primarily on price. 

Your case will need to be supported by endorsements, testimonials, product samples, articles, and books, anything that will backup your claims. If the ‘evidence’ isn’t available, then it will have to be developed. Use surveys of current and past clients, prospects who didn’t buy and those that are stuck in your sales process to determine what is important to them when doing business with companies like yours. 

Take a look at your marketing materials. Do they say anything that would make anyone want to buy from you? The marketplace is littered with bankrupt companies who wouldn’t ask the hard questions to determine if improvements have to be made in their way of doing business or marketing. Your marketing and advertising probably contains words like highest quality, most professional, lowest price, largest selection, and the list of advertising ‘fluff’ goes on and on. Claude C. Hopkins pointed out 80 years ago that “Generalities and platitudes roll off the human mind like water off of a ducks back, making no impression what-so-ever.” Without some way to support your detailed specific claims, in other words a ‘case’, most businesses and consumers won’t believe a single word you are saying. 

Great Communications Is Essential… 

The great business philosopher, Jim Rohn, said it best in his lecture about communications. He was talking about personal communications, not about advertising or marketing, but the principle still holds true. He says to be a master communicator; all you’ve got to do is follow this simple three-step process: First, have something good to say. Second, say it well. And third, say it often. 

In terms of advertising, here’s what that means: Having something good to say means that you’ve innovated your business sufficiently so that you’ve got something unique that’s worth advertising. Saying it well has to do with taking what you do well and saying it in your advertising in such a way that it gets people to notice and take action. To say it often you need to follow-up on all inquires to your business with compelling pieces that make the case for your company. Typically only 1- 5% of your market is prepared to buy today and how you stay in front of the other 95% is critical. Good follow-up is essential to growing your business. Your follow up doesn’t need to be expensive but it should be informational and focused. 

Systematically Eliminate Any Competitors… 

Once you’ve created your case, you need to consistently and cost-effectively “deluge” your target market with your messages. This is not just simple repetition in advertising.  You’ve got to cultivate the entire market so that when they're ready to buy, you are the obvious choice in their mind. 

An automated follow-up system can help you (or an individual sales person) work 5 times more leads, spend more of your time closing businesses, and always have as many leads as you want or need. You are able to work more leads by sending your prospects well-articulated marketing pieces that continue to build and support your ‘case’ through email, fax, direct mail, video, audio, or any other method they will respond to. 

8.0  Building your PR muscle in Europe
                         - maximum PR bang for minimum Euro

by NetSudser Rose Ross, Founder and CEO of Omarketing – European technology PR and marketing specialists, rose@omarketing.co.uk

As a start-up - why shout from the Euro rooftops?

Although size is, as they say, not everything, it is worth considering that the combined population of France, UK and Germany add up to 70% of the population of the US. These three countries alone can almost double your reach and earning potential.

However, it is also worth considering the following areas.

Creating value through a global brand

The perceived brand value of your company from the perspective of the VC community as well as of other interested parties comes in many forms. Of course it is vital to build awareness of your products in the US using your own in-house PR resources, or perhaps with a PR firm with the relative expertise. Building awareness in Europe will also add to the bottom line for IPO, acquisition or the next round of funding.

Building on business opportunities

Getting those first few referral sites can often be a challenge, but European buyers may be more open to your offering than you may have expected. For one thing, they may not be being courted as aggressively, if at all, by your competitors.

IT professionals in Europe are often further along the technology acceptance curve than you may have come to expect.

Attract sales partners

In Europe there is a lot of emphasis on the use of channel partners as part of the sales process, especially when you consider the language barrier and geo-political concerns. One huge counterforce to these problems is the ability to sell in Euros in most of Europe.

Using your European successes to drive PR in the US

Case studies and other news pieces about business wins and strategic partnerships in Europe will give your company recognition as a global player and will add weight to your PR activities in the US.

Once you say yes to PR in Europe, what are your options?

1) Using your own US team

From a cost perspective, this can be a very attractive option, especially in the short term. In some cases it may be your only viable option.

2) Going native

By working with local PR agencies you can gain a significant advantage for your company in terms of the speed at which your message is delivered. A local agency will have a much more accurate distribution and contact list of relevant journalists that write for your target media.

a) Going global with a global PR agency

Many large PR firms with so-called global networks will undoubtedly blow too much of your cash too fast and too soon. There is no real choice of local agency in each market and this is your ‘global agreement’. This may mean that you have to take the rough with the smooth in each market. Perhaps too much of a risk for a big price tag.

b) Local talent – small but perfectly formed?

A good approach would be a team in one European country or perhaps a small consortium across key geographies. A key skill for this team would be for it to be able to function as an extension of your existing team in the US. For that they need to be experienced in your market or a closely related one or show a real ability to learn quickly. Have good references from clients and the press.

On the downside, how do you find these Euro gems? Ideally, your existing agency may already have partnerships and if they fit your criteria this may work well.

In addition, your contacts in other start-ups, your strategic partners and the VC community will have contacts as well. Sometimes your own activities in the US will attract pro-active agencies that are keeping informed of markets that they operate in with other complementary clients.

Once bitten, twice shy – how to minimize your risk exposure and maximize your return

Good, cost-effective PR can be the best-value marketing budget you will ever spend. Bad, low-return PR activity can at the very least burn up cash which could have been used elsewhere and effort but at worst alienate some of your key press and loose you valuable momentum.

Finally, some top tips for making the most of PR opportunities in Europe:

- Test-drive a prospective PR agency in Europe by hooking a small PR project onto an announcement or trade show. To make this process worthwhile it should last for at least three months. Be clear with the agency that if things go well the relationship could become a long-term relationship. If they are good they will know the market and be well positioned to provide support in Europe, especially if they offer more than just PR services. They should be able to introduce you to professionals in other marketing disciplines such as advertising, media buying and creative.

- Many PR consultancies in Europe offer their clients analyst exposure and speaking opportunities, additional services that can be purchased on an as-required basis.

- Use your team in the US to drive this activity, but listen to the local teams too. A high volume of your PR activity in Europe can originate from your US team but bear in mind it may need localization and, wherever possible, a local angle.

News with little European relevance or at worst a purely US-specific story, such as a new program or product available only in the US, will probably not be picked up. To make the most of this type of news a team in Europe would probably need a briefing and final copy for the release no later than 24 hours, ideally 48 hours, before it goes live.

- For good local European stories this needs the support of your team in-house and any external agencies to provide support and strategic PR direction especially in the early days of a PR focused relationship. The advantage of close collaboration at the earliest stages is that the story can also hopefully provide a good angle for the US press too.

- More haste, less speed. The window of opportunity to comment on news stories can be limited, as news hounds often want to close the story in 48 hours or less. So for you in real time this may only give you a short period in which to comment, and interviews and comments may need to be e-mailed overnight.

- Be flexible. Journalists are often happy to do interviews up until 5:30PM at their local time but extending an invitation to a live web cast at 4:00PM (Central Time) you are unlikely to get much of a response except from the most avid of insomniacs.

- Are you speaking my language? It is hardly surprising that countries where English is not the mother tongue will prefer news in their own language. Countries where English is not a problem include Germany, Nordic countries and the Netherlands.

Although not always possible at the onset, most journalists will prefer to be informed in English than not at all so sometimes a compromise can be reached a short intro and summary of the news in the European language and a contact in that country can make all the difference. Incidentally, British journalists do prefer press releases with “ise” rather than “ize” and “favourite colour” instead of “favorite color”.

Be my guest - In Europe it is much more acceptable to be wined and dined by the vendor community than in the US. It would not be seen as an attempt at bribery if you were to offer a beer and a sandwich to your guests from the press at your product launches.
 

9.0  Guest Writers for This Report

I have opened up the Monthly NetSuds Report to guest writers. If you have a passion for a topic, and you can write (at least no worse than me), send an email to me matt@netsuds.com.  You can even send copies of your work.  It needs to be on "com and .com" topics and can include entrepreneur/investor activities.  Good information from our    service providers and vendors is also welcome so long as it is not a "commercial" for any one company or individual.

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Matt Noah

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