Asking the CEO #4: How do you conduct business in Hollywood from Brno, Czech Republic?
Did you know from the beginning that the Czech Republic was not a target market, making the US the obvious initial focus?
Yes, with the JPEG2000 codec, we were aiming for the American market. Securing our first European and Czech client took many years. Today, 70% of our revenue is still from North America.
Our initial investment was 200,000 EUR, a substantial sum that facilitated our introduction to North America. I dedicated a significant portion of my time traveling to and from the States. Though it disrupted my sleep schedule, it enabled us to establish crucial connections. This presence allowed us to gain a foothold in the entertainment industry, where, as I’ve noted before, such relationships are vital.
How long did it take you to build relationships with clients? Give us an example of how long a former Eastern Bloc company takes to win American customers.
While initiating conversations isn’t too challenging, as Americans are receptive to exploring new market solutions and envisioning innovative ideas, cold calling can be particularly tough. It’s beneficial to have a referral or someone to vouch for you. Our strategy involved attending fairs and trade shows, which made networking considerably easier. Once we forged personal connections, the process became smoother.
However, when it comes to the duration from product introduction to securing an order, it varies. The entertainment industry operates at a deliberate pace with long-term plans and budgets. Thus, finalizing a deal might stretch over two years. Yet, if memory serves, our first deal materialized in less than six months. For larger agreements, patience is essential.
How is business done in Central European countries? Has it changed in any way? Do Americans perceive Comprimato differently today?
It is not as inaccessible as it may seem. There is a time difference, but people are willing to hear what’s new. That’s also why business is so far advanced there. They are open to new technologies and solutions, trust and buy from small businesses more, and are not afraid of them. The technological level is generally a bit further; even in adapting novelties, they are ahead of Europe in this regard.
Nonetheless, without personal interaction, it is difficult there, and it is definitely easier for us to drive to see a client in Germany than to fly to New York or Los Angeles.
You mentioned a couple of interesting companies, which one are you most excited about and proud of?
As long as the payments come in, I’m fond of all our partners! But, to delve deeper, we’ve got a joint product with the renowned firm, AJA. They’re giants in the video equipment domain, having been in the market for three decades. Anyone in the industry either knows them or has at least used their gear. This joint product, built by Comprimato, is sold through their well-established channels.
The collaboration started like this: I got to know their business and what they needed. I approached them and said, “Hey, this is something you’ve got to have.” It took a bit of convincing, but they saw the potential. Today, it’s a stellar product, with its sales figures doubling every year. I am grateful for the partnership.
Read the previous part of the series “Asking the CEO #1 & #2 & #3.
