Bright’s Advice on Building a Startup Internationally
Jonah Greenberger is the founder and CEO of Bright, a startup that launched out of Y Combinator’s Winter 2015 class. Bright is building and selling residential solar power products to homeowners in Mexico, far from Greenberger’s longtime home base of San Francisco.
The Macro’s Steven Chan recently sat down with Greenberger to talk about the challenges and benefits of establishing and building a startup in a foreign country, and get advice for other founders targeting international markets.
The Macro : How did you come up with the idea for Bright? Why did you pursue it in Mexico?
Jonah Greenberger : I worked at Chevron for five years. When I decided to build something on my own, I knew I wanted to pursue something that dealt with energy and would have a global impact. Two of the biggest trends in energy were the decreasing cost of solar and increasing costs of electricity for the middle class. So with Bright, the aim was to seek out really sunny places with high electricity rates and a growing middle class. Mexico made perfect sense as our first market.
There wasn’t an “aha moment” though. The idea kind of evolved over time. It started with looking at the unit economics and talking to installers in Mexico. Things just kept iterating and I eventually realized there was enough of a credit bureau to get us started. It was a lot of small incremental discoveries that kept me going.
The Macro : Was it challenging starting off in Mexico? Had you worked there before?
Jonah : It was terrifying. I actually had no experience in Mexico. I didn’t know anyone. But I started working with a couple other people in Mexico that I was connected to, and I ended up bringing on one of them, Pablo Castellanos, as a co-founder. That has been absolutely critical to our success.
Most people don’t just start this type of business because it is intimidating and hard. There are a lot of new things at play. But I think one thing we’ve been able to do well is marry the best of Silicon Valley with the best of Mexico. We’re taken a software team and venture capital from Silicon Valley and infused it with the talent in Mexico. Once we were able to access the Mexico ecosystem, we found really talented and motivated people. But the way I think about it is that every startup has challenges. Ours are just a little different.
The Macro : What were some the of the challenges Bright faced?
Jonah : Anything from a regulatory perspective was difficult. Surprisingly, the hardest thing to do was open a bank account. It took us four months, which is a very long time in the life of a startup. You had to have a wet signature, so I signed the paper and mailed it to the bank in Mexico. My signature was a little below the line, and so they didn’t accept it, and I had to redo it. Then, they said it didn’t include my middle name, and I had to do it another time.
I learned that you had to send someone to talk in person if you want to get certain tasks done quickly that involve regulated industries. Those are some of the challenges we have to face in Mexico or other developing countries. It’s super frustrating, but it’s solvable. Once you figure out how to do it, then it becomes a lot faster.
Entrepreneurs working internationally should rely on face-to-face interactions as a default. If something is not working, send someone in person to fix it. Things move way faster when there’s a person there. You’ll just hit a wall if you try to do what works in the United States, like email or call.
The Macro : What was finding talent in Mexico like?
Jonah : We tried a wide array of salespeople – from experienced corporate salespeople, to used car dealership salespeople, to students. We realized that corporate salespeople were really expensive and were stuck in their ways. The sweet spot has been recent college graduates who are extremely intelligent but haven’t started their own company. You can teach a lot of skills to them, they’re very motivated, many of them care deeply about the environment.
We now have over 1,000 ambassadors going out and finding homes for us. When students graduate, they go from being our interns to being our salespeople, so we have this amazing funnel. It’s also great for us because it’s very low risk, and we get some of the very best talent out there. We have a constantly supply at the velocity that we need of talent, because we’re expanding the ambassador program at the rate we want to grow. This has been a great element of culture and DNA for our company.
The Macro : How do you train these students? What experience you look for when hiring them?
Jonah : We actually don’t expect these students to have a lot of work experience. But we do expect them to learn really quickly. And that fits well with who we’re recruiting. All our hires are really excited to be connected to Silicon Valley and entrepreneurship because the Mexican entrepreneurship ecosystem is not as strong yet.
There’s a ramp-up time of 1 to 3 months but after that, they’re just kicking ass. We have a culture of setting a really high bar from the beginning. Students are shocked when they first join. We expect a lot of them, but they get used to it in the first week. They see that everyone else has done it, and that really motivates them.
The Macro : What is the feedback you’ve gotten from consumers so far?
Jonah : The most interesting thing I’ve heard is that the homeowners will say, “I care about the financial savings [of using solar], not as much about the the environmental benefits. But my kids care about the environment, so I’ll do it for them. When I grew up it was about survival. My first priority is saving money so that I can provide for the family.”
So the homeowner generation see it more from a practical standpoint, but you can see that it’s different for the next generation – they care much more about having a legacy and caring about social impact. People obviously care about their kids, so now they are caring more about the environment through them. That was another reason why our ambassador program was so useful. That’s been an interesting sales mechanism, speaking to both generations and their priorities.
The Macro : Were there any different cultural norms that made things harder?
Jonah : A ton. One, there is generally less trust for companies because there is less legal accountability. People don’t trust many companies they’re approached by because they are often taken advantage of.
Another thing is that most things are done face-to-face. And lastly, there’s a slower pace of life. There was an expectation that people will be 20 minutes late to meetings and that would be okay. And that’s something we really fight. It was a big challenge at first, because you’re fighting a much bigger culture.
The Macro : Was there a useful framework that you’ve found was effective in having those kind of conversations?
Jonah : Definitely setting high expectations from the beginning. It’s actually written in our culture. And having a mentor who can explain what different things mean really helps. The more we grow, the more people can just see it. You could tell them, but it’s more powerful to have them see the people living that culture. And then, just course correcting when you see issues. When people join, we tell them their first couple weeks will be an adjustment. We tell them that it’s fine – it’s an adjustment for everyone.
For instance, a big thing with us is if someone airs a challenge, he or she has to provide a couple solutions. And we just keep doing that until it sinks it. And usually it takes a couple times, but then they become an ambassador of that culture.
The Macro : Have you run into any government pushback? If so, what have you done to mitigate that risk in the meantime?
Jonah : Not yet. We’ve intentionally limited our interactions with the government. Sometimes government officials accept bribes, but as a U.S. company we’re subject to the Foreign Corrupt Practices Act. It’s very serious. We’re not allowed to give anyone a gift. So we’ve tried to be safe and just let our partners interact with the government. We also train our staff on this issue.
The other thing is just having a business model that doesn’t have to touch the government or force those interactions. We focus on the residential sector that is least affected by the government regulation. The decision maker is the homeowner. We don’t have a government authority involved. There are almost no permit requirements so we don’t have to interact with government agencies.
The Macro : What advice would you give to other entrepreneurs targeting international markets?
Jonah : I don’t think folks should be afraid of international markets. There are challenges, but there is also a lot of opportunity once unlocked that can scale really quickly. And a lot of tools like Uber, Stripe, and Slack have been really useful for us in tackling this market: Slack from a distributed communication perspective, Uber because it makes navigating around easier, and Stripe because you can accept international payments. Whatsapp is also a great communication tool. So many tools are coming out that are enabling businesses to work in these developing countries. Startups should not be afraid of that.