Scaling in the U.S. Market: GTM Strategy

What to know about building your U.S. GTM plan.

Laura Rowson and Nowi Kallen

June 6, 2024

Successfully launching in any new geographic market presents unique challenges, and that’s especially true of the large, complex, and hypercompetitive U.S. market. U.S. businesses are sophisticated buyers that expect customized solutions. For many international startups, addressing this market requires that they tailor their products and sales approach to meet the unique demands of U.S. businesses.

As part of our series focused on supporting international companies scaling in the U.S., Salesforce Ventures recently hosted a workshop designed to help guide portfolio companies as they develop and launch their go-to-market (GTM) strategy for the U.S. market. We were pleased to moderate a conversation with Salesforce Ventures portfolio company leaders Eyal Feder-Levy (CEO and co-founder of AI-powered community trust platform Zencity) and Jen Abel (co-founder of founder-led sales consultancy JJELLYFISH).

Here are some of the insights Eyal and Jen shared with our founders in attendance.

Start With Founder-Led Efforts

A key early question for founders expanding into the U.S. is whether to move there themselves or to hire a new head of region. Both Jen and Eyal encourage founders to be on the frontline leading their company’s U.S. sales launch because the founder is uniquely equipped to sell the idea of the company—not just the product. Taking part in early discussions also helps founders refine their sales pitch and better position their business to U.S. customers. Only once the business finds product/market fit (PMF) in the U.S. market should founders shift from founder-led sales to founder-managed sales (more on this later).

If choosing not to relocate, there are some trade-offs. For example, Zencity took into account its strong hiring brand in Israel, and decided to launch with a U.S. sales team based out of its Tel Aviv headquarters. This allowed Eyal to stay close to his leadership team and impact the workforce culture. However, the trade-off was constant travel.

“To do founder-led sales calls, you need to be on the ground a lot,” said Eyal. “I was traveling 12 to 15 times a year between Tel Aviv and the United States. And I would take late-night calls three to four nights a week.”

Develop a New GTM Strategy

Expect to create a new sales strategy and GTM plan for a U.S. launch. “A founder’s day-one vision when they come into the U.S. is almost always invalidated because the U.S. market is vast, and foreign businesses often struggle to find the best segment or sub-segment of the market to target,” Jen said. “Tactics from a business’s local market often don’t translate abroad.”

U.S. prospects tend to discount international experience and want to see product validation from U.S. customers. Additionally, U.S. buyers expect something tailored to their needs. “The customer’s mindset is: We’ve purchased a lot of tech in the past. And we want to make sure that you understand this problem, maybe better than we do,” Jen said.

Companies that have gained traction in their local markets sometimes develop false confidence about the likelihood of U.S.-based success. “We did an analysis that found it took 1.5x longer for these companies to find PMF in the United States,” explained Jen. “That traction at home actually slowed them down.”

Identify the Local Ideal Customer Profile (ICP)

In some instances, a company comes to the U.S. market planning to serve one industry (usually its target market back home), only to find success in a completely different vertical—often one that’s much more specialized than the founder expected.

A startup Jen worked with expected its tech to support a variety of different business needs for U.S. customers. But after speaking with customers, the company learned that existing vendors were already covering their needs. The team performed deeper market research to identify more specific use cases where their tech could provide value. They ultimately re-focused their pitch on a more targeted function, and were able to find PMF through this approach.

Similarly, Eyal wasn’t sure which types of U.S. governments would be the best fit for Zencity, so he identified 10-15 industry events where Zencity could get in front of U.S. prospects. This approach helped the company identify the best prospects on which to focus its resources. Today, Zencity serves many large U.S. cities, including Los Angeles, Houston, Chicago, and New York.

Find the Right Messaging

Spend time creating a pitch that resonates with the company’s ICP. After hundreds of conversations, a sales team will get comfortable talking about the product and managing objections. They’ll start seeing similar use cases from each new lead. Break things down into simple, repetitive steps. This also makes it easier to predict sales outcomes and delegate. “Selling is so hard, you want to remove as much complexity as possible from the equation,” Eyal explained. “This kind of consistency can generate individual sales and create a positive feedback loop that brings in a steady stream of leads.”

It took time for Zencity to find the right way to present its value proposition to U.S. buyers. But once the team found the right language, Eyal said they were able to sign their first 10 U.S. customers in under eight months.

Hire for Scrappiness

It’s a challenge to find talented U.S. salespeople when a business has little brand equity in a new market and only a handful of customers. Jen and Eyal recommend looking for “scrappy” salespeople who have a proven track record working in unstructured environments with limited marketing and enablement functions and low-budget travel.

When a founder is ready to make the transition to founder-managed sales, Jen and Eyal recommend starting with two sales reps instead of hiring a large team, and to be prepared for churn—assume one out of every two salespeople won’t work out. A failed sales hire can be costly because the business loses the cost of the salary plus the value of the lost sales and wasted leads. Zencity’s threshold for salespeople is typically two bad quarters.

A business’s first hires should know how to create demand using tactics like scouring conference lists, searching LinkedIn, and cold calling or cold emailing. With limited resources, startups may not be able to hire business development reps (BDRs) for lead generation. Zencity relied on account executives (AEs), waiting to hire BDRs until the company had achieved $1M in annual recurring revenue (ARR).

Jen noted that many salespeople have never been trained to generate demand—they’ve always been given leads. As such, when interviewing candidates, Jen recommends asking salespeople about their average deal value and sales cycle, and exploring the ways their leads were generated. Did they source the deal? Did they close the deal?

Remember that some salespeople will be inherently better at the top or the bottom of the funnel. Others may have a higher “likeability factor” with decision makers in a given vertical—and it’s not always who you expect. For example, organizations that skew older may prefer working with younger salespeople because they offer a perspective that isn’t currently represented internally.

A business’s sales incentive structure is also critical. Encourage AEs to do everything—from prospecting to closing—by offering twice the commission for any leads they create.

Learn more about hiring U.S.-based talent in our recent blog post: Scaling in the U.S. Market: How to Build a Winning Team.

Shift to Founder-Managed Sales

To achieve scale, an organization must gradually shift from founder-led to founder-managed sales. Before this shift can occur, a sales team needs to generate healthy conversion and win rates. A good rule of thumb is 10-20% conversion rates for outbound sales and 30-50% for inbound sales—although this rate may vary by industry and where the business is in sorting out PMF. Jen recommends the following “gate checks” to track a company’s progress:

Can the BDRs generate demand? Are they hitting the number of leads and conversion rates that the company needs to meet its goals?
Can the AEs take the intro call? Are they able to convert prospects into sales-qualified leads at a similar rate to the founder?

When founders are ready to make the transition, they should first move out of the sales process at the top of the funnel and then work their way down. If numbers fall after the sales team begins leading the process, the founder should get back into the sales cycle.

“Whenever we had challenges in our sales team, I stepped in and cleared my schedule of other things,” Eyal said. “Because if this doesn’t work, the rest of the business isn’t viable.”

Develop a New GTM Plan for Each Vertical

Companies entering the U.S. market should wait for consistent performance in one vertical market before expanding to another. “Every vertical is going to have different messaging, different buyers, different willingness to spend, different sales cycles, and different specific problems they want to solve,” explained Jen. “You can’t serve them all the same way.”

Once a business moves to a new vertical, it will need a new GTM plan. Make sure to assign new AEs to each new vertical so they become experts in that industry.

Conclusion

Selling to U.S. businesses as an international startup is challenging, but often worth it: Almost every startup that achieves scale has a U.S. presence. However, breaking into the U.S. market requires a rock-solid strategy, continuous iteration, and patience. “It’ll take twice as long as you think to truly gain a foothold,” Jen said. “But if you can weather the storm, the payoff can be huge.”

Salesforce Ventures hosts frequent workshops with experts and industry thought leaders designed to address our portfolio companies’ recurring challenges and to support them on their path to success. To learn more about Salesforce Ventures, visit our website.