Building a SMS API Company from London: Nexmo CEO Tony Jamous (Part 7)

Sramana: I see a lot of virtual organizations emerging in the startup space. We are a virtual organization ourselves. In your opinion, what are some of the pros and cons of running a company in that model?

Tony Jamous: My experience is that it depends on the person. When I first hired the first few people, I tried to make sure they were self-starters and knew how to manage themselves. One of the communication challenges is that we need to know how to get things done via chat. We have an internal team Skype chat, which was easy to handle when we were small.

Now that we have grown as a team, it tends to be a bit more complicated. When you hire people who are less senior, you need to be there to help them grow and understand the business. We are trying to centralize around Asia, London and the U.S. We are trying to avoid hiring remote people; however, my hiring strategy is still l focused on finding the right person.

Sramana: It sounds like you are starting to shy away from a virtual team and are trying to move to a centrally managed model.

Tony Jamous: The best-case scenario is to have the right people in the right location. We expect to have the right person in different locations. It can be difficult to find the right people. There is the ideal scenario, and then there is a scenario that we can tolerate.

Sramana: How expensive is it to build a tech company in London?

Tony Jamous: It is quite expensive. The difference between here and San Francisco is that technical talent is cheaper in London. It is also less competitive. We are able to hire great developers and architects. We are still in the heart of Europe, and London is a heart of the telecom world. The downside is that it is a very expensive city. We were very lucky to find a great office at the TechHub in London which is sponsored by Telefónica and Google.

Sramana: What has your experience been establishing a presence in Asia?

Tony Jamous: Asia is a huge market for us. First, competition is low. Second, it is a massive market. It is really important to invest in Asia. It has a high barrier to interest because it is all relationship based and there is a diverse range of culture and language. We have brought on two Asian minority investors who are helping us build an organization and develop a local flavor. Our investors are located in China and Korea.

Sramana: Do you have customers in Asia right now?

Tony Jamous: Yes, they have found us through the Internet.

Sramana: Where is the bulk of your market?

Tony Jamous: From a revenue point of view it is Europe because there is a high price per message. The margin is lower in Europe. The U.S. is a growing market and has a very low price per message. From a revenue point of view, it is not that interesting. We have a lot of competition there. I believe Asia is the best market for us at the moment. The Middle East and Africa are also high-growth markets.

Sramana: What percentage of your business comes from startup companies doing interesting apps?

Tony Jamous: I would say that 1% of our business comes from individual developers, 40% comes from startups with fewer than 10 people, and the remainder of our business comes from more established companies.

Sramana: This has been a very interesting story. Thank you for sharing it with us. I look forward to following your company as it grows.

This segment is part 7 in the series : Building a SMS API Company from London: Nexmo CEO Tony Jamous
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