A New Zealand software company’s appointment of a CEO in the United States shows how much selling – and how little – can be done online.
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Entrepreneur: Mark Thomas, President
Company: Right Hemisphere Limited
Business type: Computer graphics software development
Founded: 1987
Turnover: $NZ2M - $NZ10M
Head office: New Zealand, Auckland; USA, Bellingham (Washington State) & Los Angeles (California); Russia, Perm
Contact details: +64 9 523 4670
The Right Hemisphere Story
When an Auckland-based software company appoints a CEO in Los Angeles and establishes a development office near the Ural Mountains (1150 km north-east of Moscow), you know that they are serious about competing globally. Since 1995, Right Hemisphere has become the world’s largest developer of software tools for painting and distortion-free texturing of three-dimensional (3D) objects in 3D production for film, broadcast, game development and web content creation.
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Key learning points:
- Market presence - There is no substitute for having at least one employee located in your key market. In the US, a CEO commands greater attention than a sales person.
- Online marketing - Use communications technology to market products. Effective online product demonstrations help conserve corporate resources.
- Strategic partnering - Develop strategic partnerships. Alliances based on mutually held values increase the chances of success.
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The company’s president, Mark Thomas, says of the firm’s Russian operation: “Part of our strategic plan is to be able to move horizontally in the market, to strategically partner with as many different companies for success as possible. Towards the end of 2000 we identified a very key set of technologies developed by a small Russian company. Early 2001, we concluded discussions and have acquired (it) as a development office.”
Before 1995, Right Hemisphere imported US computer graphics products and redistributed them in the Asia-Pacific to countries including Japan, Korea, China, and Hong Kong. Thomas says: “Eventually, we started discovering that the market had changed, and there were some very significant changes in the technology landscape, from DOS to Windows NT and so forth. We knew that the little developers we were reselling for could not keep up and we thought ‘Why don’t we have a go at developing our own products?’. ”
The company’s calculated gamble on the direction of technology - and Right Hemisphere’s ability to provide suitable products - has paid off. Right Hemisphere is now the market leader in its very narrow but growing niche market, according to Thomas.
Thomas says: “The trick [of expanding into the USA] was how you actually grow a position in the international market from a place like New Zealand. We did a lot of work through travelling. We have advertised, but more recently we have had to have a presence over there – someone who could be sharing the company’s vision with whoever.”
After a lengthy process of informal head-hunting - through business networks - the company found its US CEO in Los Angeles. It was the best possible location for the company, being the centre of the US movie industry.
Thomas says: “The guy we took on as CEO is very good - works with a passion and [Right Hemisphere's] vision. It’s expensive - the salaries over there are not insignificant - but we have found that it really has improved business. Having the ability to put a CEO [rather than a sales person] on the doorstep of a strategic partner has closed deals that were clearly dragging.”
Thomas is a strong advocate for strategic partnering. He says: “I think it has really enabled our success. Rather than trying to do everything alone, it’s about trying to find the right partners [with] mutual value points and exploiting those in every possible way.”
The company has no sales staff in the US. It uses New Zealand-based salespeople who demonstrate products to US companies using Webex technology and high-speed Internet access. Thomas says: “[This] enables us to actually show the technology on our computer so that it is replicated in close to real time on screens in the US. We can cover an awful lot of ground at the small-to-medium business opportunity level much faster than we could if we had a sales staff on the ground there.”