Over lunch Victor van Tol, founder of Snappcar, shared his internationalisation successes with us, but also tells us how he initially underestimated cultural differences when he tried to copy paste the Dutch model onto the Swedish and Danish market. And the high churn that caused. Snappcar has established itself as one of the leading peer- to peer car sharing platforms, after several years of explosive growth, new investments and international expansion.
”When we went to Germany, we did not repeat the same mistakes we made in Denmark and Sweden.” – Victor van Tol
Victor talks fast and with a lot of energy, in the meantime he also answers some e-mails on his phone and manages to eat as well. He tells us that Snappcar currently has around sixty employees spread out over four different countries, although the vast majority still works from the headquarters in the Netherlands. The topic shifts to Snappcar’s expansion and eventual internationalisation. Victor tells us that Snappcar acquired two local car sharing services in Denmark (Minbilbindil.dk) and Sweden (Flexidrive). These services were integrated into snappcar and went live in early 2016. When we ask about the internationalisation strategy and success of these moves, Victor openheartedly tells us that they underestimated the difficulty of succeeding abroad. He explains that Snappcar tried to copy and paste the same model of expansion that had proven successful in the Netherlands, assuming that this would also work in Sweden and Denmark. When it did not, Snappcar experienced significant churn, lost money and gained valuable experience.
Victor explains that this was a significant learning moment for Snappcar and for him personally. He then lists several more reasons why the expansion into Denmark and Sweden was not successful initially. Snappcar underestimated the differences in (car sharing) culture between Denmark, Sweden and the Netherlands. Victor also notes that Swedish and Danish users saw Snappcar’s acquisitions of the local car services as an aggressive move by a foreign party, which was disastrous for a car sharing service – where trust is one of the biggest requirements. Lastly, Snappcar kept the local Danish and Swedish CEO’s to steer their companies under the Snappcar banner. This did not work out because, as Victor explains with a smile on his face, entrepreneurs are often headstrong and can be quite stubborn.
When Snappcar was ready to head to Germany in 2017 Victor told us they were far better prepared and did not make the same mistakes as in Denmark and Sweden. In preparation of the launch in Germany Snappcar included the heavy users of Tamyca, the acquired local car sharing service, in the transition from Tamyca to Snappcar. Additionally, hiring a country manager for Germany and a strong and fresh local team who visited the headquarters in the Netherlands extensively in the months before launch helped immensely. As a result, when Snappcar went live in Germany, they experienced almost no churn and are happily growing the service!
When we switch topics to Snappcar’s current internationalisation strategy Victor explains that he asks himself two important questions to help him determine next steps:
- Is it the right time, is the time now?
- To which countries would we go?
Victor tells us that, after considering this, the focus for Snappcar now lies on expanding further within the bigger urban areas in Germany, as well as renewed expansion in Sweden and Denmark. When we ask about the current national and international growth Snappcar is experiencing, Victor enthusiastically explains that the current growth is very exciting and vocalizes the wish to become a profitable company sooner rather than later. He also puts the emphasis on his, and Snappcar’s, wish to decrease the number of cars in big urban areas and combat CO2-emissions by sharing cars.
As our lunch is ending, we are curious about what Victor thinks makes most internationalisation attempts go awry. After thinking for a few seconds he tells us that underestimation, both in general as well as in cultural terms, is probably one of the biggest reasons nine out of ten international expansions fail.
Before letting him go, we ask victor for his three golden tips on internationalisation. Here they are:
- Don’t go too early! timing is everything, make sure your research is up to par.
- Where will you go – really think it through! Countries like Denmark and Sweden are excellent testing grounds.
- Keep the local conditions in mind, both in your product or service as well as in building the correct local team.
Is your company ready for the next step? But don’t know how to approach internationalisation? Let DutchBasecamp help you – check out our international strategy coaching!
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