At Airtree, we host exec forums for our portfolio companies to bring together a community of people who understand what it's like to start and scale something from scratch. It's an opportunity to network, ask each other questions, share resources and swap notes on their most pressing challenges. 

In a recent COO forum, we were lucky to have Michael Stocks, VP of Strategy and Operations at Linktree, share his view on how Linktree has scaled its presence globally. 

Propelled by the explosion of the creator economy, 98% of Linktree's users are outside of Australia. While the US accounts for a significant portion of the company's revenue, they have a material presence in other territories, each with different challenges and nuances. 

Michael outlines his five-part approach to scaling a business internationally, covering pricing, payment methods, performance, talent and prioritisation. 

Pricing

Historically, Linktree charged a US dollar-denominated price point in all its territories, and users could choose between a monthly and annual subscription. In mid-2021, after seeing user growth in Brazil and Indonesia but a lower free-to-pro conversion than in other markets, Michael and the team decided to lower the price.

"We really were shooting from the hip back then - or as we say at Linktree act then adapt. We looked at some comparisons in terms of what other SaaS businesses were doing in those territories, from Netflix to Apple and Dropbox, to create an index, but it was pretty arbitrary. The result was cutting the price of our plans by nearly 50% and introducing pricing in local currencies. We increased the volume of paying users enough to offset the price cut, but there wasn’t a lot of science behind the decision," says Michael.

Rather than the scrappy index-based approach, Michael's advice to other operators is to adopt a more data-driven approach to pricing, which is how Linktree operates today. In addition to market surveys, they run pricing experiments and optimisations with real customers. 

"If you think back to your old economics textbook, what we’re looking to do is uncover the demand curve for our product," says Michael. "We're lucky that we're able to do this because we have a relatively low priced product with a high volume of customers, so we can reach statistical significance quite quickly."

Payment methods

In the US, payment methods are straightforward because of the high credit card penetration. It’s more of a challenge in markets like Brazil, India and Indonesia, as many consumers don't have access to a credit card. 

Linktree is rolling out payment methods for users in new markets over three stages:

• Short term – Enable global digital wallets
  The first easy step is to turn on existing global wallets like Apple Pay, Google Pay and PayPal. Linktree found that Apple Pay was less applicable in developing markets as take-up is low. Google Pay and PayPal were more helpful in these territories, acting as a funnel for alternate forms of payment that can be stored on its platform. It's a quick solve, but it doesn't give you all the coverage you need. 
  

• Medium term – Unique gateways per region
  Once you start to build up the volume of transactions, the payment rates matter for each market that you operate in. A central subscription management tool such as Chargebee allows you to route payments via the payment processor (e.g. Stripe, Adyen) with the lowest rates on a market by market basis. 
  

• Long term – Deliver localised priority methods
  The long term goal is to build direct integrations with local payment methods, to allow for truly unique payment methods that are endemic to a particular market (e.g. Boleto in Brazil). It’s worth noting that: "It's not a simple plug and play like the first two [short and medium term] steps. You need to run the numbers for your business and see if the expected take up would be worth the engineering lift.”

Performance

It's an obvious one, but the faster your website loads, the happier your users will be. Linktree’s Growth and Product teams look to build with empathy for users who have limited bandwidth and processing power on their devices. 

"Seconds really do matter in the context of page load time. Use an online tool to simulate loading your website on different devices in emerging markets and at different speeds. You need to live that experience to understand the users' frustrations and get that work prioritised. Your product teams need to build these practices into the way they do QA and testing," says Michael. 

Talent

Of all the steps to nail, the right talent is one of the most critical parts for Michael. "When you think about your first hire in a new territory, you need to find brilliant generalists. They need to be high-quality operators, understand marketing, local trends and growth and be in there speaking with customers. Our Head of Growth, Jess Box, has done an incredible job finding these hires for us at Linktree," he says. 

In any new territory, Linktree's first hires are Country Growth Managers, who have a real hunger to go out and make an impact. The expectation is that they'll be evangelists for the product and brand, rather than selling multi-seat plans to enterprise customers. 

Prioritisation

When the world's your oyster, the opportunities are endless, but that doesn't mean you need to do it all at once. Michael's advice: "Don't just say you're going global: Be explicit about which countries."

"For us, that's a stack-ranked list of 10. We got to those 10 by running a mix of quantitative and qualitative scoring exercises. We took a quantitative look at historical data of how each market has performed across key metrics, and then added a few qualitative layers such as 'How difficult is it to do business in that territory if we were to hire a team there?' and 'Do we see a long-term opportunity for the creator economy in this territory?'," adds Michael. 

An important part of the market scoring exercise is sharing the results internally. You can rally a team behind a shared set of priority markets, which then guides decisions from paid media investment to headcount allocation. 

Michael's final piece of advice? "Expect the unexpected. Expanding internationally is not easy, and there are a lot of surprises that will come up along the way.”