1. Customer and Revenue Acquisition in Asia-Pacific Jeremy Geiger www.LinkedIn.com/in/JeremyG JeremyGeiger@RTMAsia.com www.RTMAsia.com

2. Agenda Background Asia-Pacific expansion. When? Country-Specific Considerations – Business Development – Product, Localization & Support Go-To-Market Investment & Requirements AP Revenue in relation to global revenue

3. Who Am I? Living in Asia-Pacific for 15 years – Tokyo, Seoul, HongKong, Singapore, Bangkok – Business expansion in Japan, Korea, China, HongKong, Singapore, Thailand, Philippines, Malaysia, Australia, India, NZ Started-up 15 new country branch operations – Enterprise software for supply chain, ERP, BI, CRM, BPM, 3D visualization – $65M revenue, 30+ partnerships, 50-150% annual growth EMBA from Kellogg School Mgmt program in Asia Currently work with software, SaaS, internet & consumer electronics companies as part of RTM Asia

4. Who is RTM Asia? 80 Successful Asia-Pacific Business Executives Working with technology start-ups: Consumer/Enterprise software, internet and hardware Who have the challenge of expanding internationally RTM Asia creates new market opportunities in AP Market analysis and go-to-market plan for key Asian markets Accelerate growth & profitability Create new business models in Asia to drive incremental upside Minimizing effort, investment & learning curve from HQ

5. Agenda Background Asia-Pacific expansion. When? Country-Specific Considerations – Business Development – Product, Localization & Support Go-To-Market Investment & Requirements AP Revenue in relation to global revenue

6. WHEN to consider Asia-Pacific expansion? 1.Customer is pulling you – Enterprise customer is asking you to support product in AP – Consumer: Significant swell of new users in AP country 2.Strong growth, publicity and customer references in US 3.Potential partner/reseller from AP approaches you 4.Market potential is unusually high in Asia-Pacific – Automotive, Aerospace, Manufacturing, etc. 5.Capital available

7. WHEN to consider Asia-Pacific expansion? Typically stage – $5M-$10M annual revenue for software vendors – Initial contact from potential AP prospect and/or reseller Typical reasons 1.Revenue (to increase profit or funds for R&D spend) 2.Become a Global player (with international references) 3.Company valuation (global revenue potential increases valuation)

8. Agenda Background Asia-Pacific expansion. When? Country-Specific Considerations – Business Development – Product, Localization & Support Go-To-Market Investment & Requirements AP Revenue in relation to global revenue

9. DIFFERENCES and considerations among AP countries Size of Market Early Adopters? Unit Price RisksMost Typical Sequence Aust/NZ1 Japan2 China3 Singapore/HK4 Korea5 India6 Thai/Malay/ Indo/Phil 7 *Note: ROUGH Generalization. Highly dependent on product, market, industry, etc.

10. Sample Asia-Pacific Expansion Timeline Aggressive06121824 Conservative012243648 Aust/NZ Japan China Singapore and/or HK Korea India Thai/Malay/ Indo/Phil Months

11. Agenda Background Asia-Pacific expansion. When? Country-Specific Considerations – Business Development – Product, Localization & Support Go-To-Market Investment & Requirements AP Revenue in relation to global revenue

12. Difference among AP countries: Product Need for Localization Expected Product Maturity Need for Customization Aust/NZ Japan China Singapore/HK Korea India Thai/Malay/ Indo/Phil *Note: ROUGH Generalization. Highly dependent on product, market, industry, etc.

13. Difference among AP countries: Support & Presence Support Volume Local Presence (Partner or Direct) Channel Partner Network Vendor Direct Presence Required Aust/NZSingle JapanDouble ChinaDouble Singapore/HKSingle KoreaSingle IndiaSingle Thai/Malay/ Indo/Phil Single *Note: ROUGH Generalization. Highly dependent on product, market, industry, etc.

14. Levels of Localization Level 0 – Marketing Materials Level 1 – Product Documentation Level 2 – Access files with local language names Level 3 – User input in local language/formats Level 4 – User interface

15. Agenda Background Asia-Pacific expansion. When? Country-Specific Considerations – Business Development – Product, Localization & Support Go-To-Market Investment & Requirements AP Revenue in relation to global revenue

16. Partner Approach Most countries in Asia-Pacific require a partner-centric approach Types of partnerships 1.Strategic Partner with investment 2.Strategic Partner without investment 3.Master Distributor 4.Alliance Partner 5.Resellers

17. Go-To-Market Requirements $500k - $1M investment per country, in the 1 st year Target break-even in 12-18 months (with no royalties to HQ) Need top Pre-Sales person support Invest in Strategic top-down analysis rather than signing first reseller that knocks on your door Need localized product unless targeting highly specialized technical/management positions Country/Regional Manager should have relevant experience doing strategic deals

18. Office & Employee Costs Tokyo, Seoul, Shanghai – Office Space not unlike SF/NY – Top management not unlike US salaries Australia, Singapore, HongKong, Bangkok – Office Space 75% of SF/NY – Top management 75-100% US salaries – Lower positions 50% US salaries (except Autralia) – Stock options not valued as highly as US

19. Go-To-Market Short-Cuts Using knowledgeable 3 rd parties that can get appointments with the most strategic partners/customers can have significant impact – 3 month Strategic Go-To-Market Analysis – Operate your branch operation without capital expenditure – Raise capital from local strategic investors – Get paid, based on results

20. Investment & ROI Expectations Go-to-market can be achieved with different levels of involvement & investment: – High: Direct hire, open offices, local regulations ($750k/country) – Medium: Country heads, virtual offices, partners Year 1 Investment per country EntityEmployeesOffices1 st Year Target ROI Year 2-3 Profit Potential Long-Term Profit Potential Big Bang$500k - $1M100% owned subsidiary Direct hiresRented0%MedHigh Strategic Investor $250 - $500k Majority- owned subsidiary Direct hiresRented250%HighMed 3 rd party Accelerator $100 - $400k NoneProvided by 3 rd party 150%MedLow-Med Remote Partner Mgmt $100 - $300k None 0%Low Note: Option to start with 3 rd party accelerator and then move to Big Bang or Strategic Investor once market traction

21. Agenda Background Asia-Pacific expansion. When? Country-Specific Considerations – Business Development – Product, Localization & Support Go-To-Market Investment & Requirements AP Revenue in relation to global revenue

22. AP REVENUE in relation to global revenue? AP is typically 10-50% of global revenue Median 20-25% Traditionally, almost 50% of AP revenue from Japan In future, China’s share will increase

23. AP REVENUE in relation to global revenue? Much of US tech company’s growth is fueled by international expansion. Ex.: In 2008: – Oracle Overseas sales +22% vs. US +2% – Cisco Overseas sales +20% vs. US -8% – Google Overseas sales +40% vs. US +22% – eBay Overseas sales +16% vs. US +5% – Apple Overseas sales +29% vs. US +20% – Sun Overseas sales -2% vs. US 10%

24. Summary

25. SUMMARY: For Business Development / Marketing There is global demand for useful solutions Global expansion improves company revenue, profitability, valuation and company credibility Each country in Asia-Pacific is different and requires a different approach There are different strategies for Go-to-market depending on investment & bandwidth available Do your homework and involve knowledgeable people

26. SUMMARY: For Localization People Asia-Pacific can not be treated as 1 group of users. Each country will have unique users & needs Invest upfront in proper technology and processes because once Asian market expansion starts, it is likely to expand rapidly to other countries The structure and number of parties involved in sales, support and training will be very different than the US Customer demand will drive localization needs

27. Thank You Questions? Jeremy Geiger JeremyGeiger@RTMAsia.com www.RTMAsia.com

28. RTM Asia Client List 28