Product Development Marty Cagan

A Trend of Global Proportions

I am writing this article sitting on yet another international flight, and I wanted to discuss what I believe to be the start of a truly transformational trend.

I have always enjoyed working with teams internationally and especially in developing markets.  There is a newness and enthusiasm about products and technology that is contagious, and I have long believed that if you can assemble a team of smart, talented and passionate people, you can show them the techniques and methods for creating great products.

However, for many years I believed that while you could supplement your workforce by outsourcing talent from other parts of the world, if you were serious about product you really needed to be in Silicon Valley.  So much of the ecosystem that we depended on was only here in Silicon Valley.

Today I no longer believe you need to be in Silicon Valley in order to create something amazing.

I would argue that Silicon Valley is still Mecca for technology innovation, however, the differences are much less than they used to be, and the access to local talent can even the playing field.

From my vantage point, our industry has evolved over the past several years, and today we’re on the cusp of another major step.

Initially in developing markets we would find mainly outsourcing.  Teams of developers and QA would be hired by mainly US firms to supplement their workforce.   Silicon Valley’s thirst for talent combined with our constrained geography (and hence cost of living) demanded this.

Next, as the developing markets gained steam and moved online, and the population itself represented an interesting target market, you’d find mainly US companies going after those local markets.  They had needs and we had products.  Nothing wrong with that.

But it didn’t take too longer before the talent in these markets start creating their own products for their own markets.

You might be thinking that mostly these are just copycats of mainly US products.  Initially this was true.  Even though I’m not a fan of copycat products, it was understandable to me.  US companies often weren’t taking local needs seriously, which created the need.  Also, local teams often lacked the confidence and skills to pursue their own ideas.  It’s also true that many VC’s preferred to fund teams to do copycat products.  In any case, this was how many entrepreneurs got started.

By the way, copycats happen in the US at least as much as in the rest of the world, and the VC’s play a role in that here too.

This has all been happening for a while now, and increasingly I am seeing startups pursuing truly innovative products for their local markets.  But now I think we’re starting to see signs of the final step in this progression: startups creating innovative new products that are intended not just for their local markets, but for the world.

When I meet a startup in a developing market that has done something truly innovative and valuable, which happens increasingly often on my travels, I always encourage them to think about the broader world market.  They’re often nervous and even a little intimidated, but it doesn’t take much to help them realize that their contribution is just as needed in the US and across Europe as it is in India, Brazil or China.

One advantage that US companies have is that since their default (and often only) language is English, and since English is an acceptable (although not usually preferred) language in a large percentage of the developed world, US companies are able to get their ideas into a broad set of markets much more easily.  And since so many sites have user generated content, that content is also then in a language that others can benefit from.

This is why I push on companies to make sure that they support at least English out of the gate (in addition to their native language).  It may not be fair, but it’s in their best interest.

There are still some obstacles to this progression reaching its potential.  Some governments make it nearly impossible for startups.  Some cultures are very risk averse.  Some investors have old biases.  But in many parts of the world, the stars have aligned and great product work and innovative startups are emerging.

Some of my favorite product innovation hubs outside of Silicon Valley: New York, Boston, Berlin, Sao Paulo, Bangalore, and Beijing, with scattered teams almost everywhere.