Gadgetory

welcome to Miami gateway to Latin America and I'm here because it started this season I went on Twitter and I asked everyone what is the company in Miami tech that I need a visit and everybody said open English now open English is a platform that connects people all over the world to live instruction as well as tutorials so that any Spanish or Portuguese speaker and learn to speak English and what's so cool is this company started in Caracas we're gonna find out what brought them here to Miami mm I'm Alexis Ohanian start-up founder and Y Combinator partner over the last year I went on a two hundred event book tour and met people building small empires all across North America now I'm back with a new season revisiting some of my favorite stuffs from the tour the thing that makes software companies so attractive to venture capitalists is that once you have enough finished the costs of scaling that business are really low you could sell it at an app marketplace and cost for cloud software are getting cheaper every day startups you have to hire humans to grow face a much more challenging environment if you have to hire a new salesperson driver or stock boy for every hundred new customers that's gonna eat a lot of your eyes open English a language learning startup is dealing with this plastic connector it's service is popular and can be distributed anywhere in the world but the company has to hire salespeople and teachers to support that growth the trick here is to make sure your costs don't outweigh your revenue obviously otherwise all the money and time that have been invested in open English will fall by the wayside open English is the leading online English school in the Americas so we are in 20 different markets all Spanish speaking Latin America Brazil the US Hispanic market and what we created was an alternative for emerging market consumers to learn English that wasn't going to the brick-and-mortar school we created a open English which is available 24/7 you just open your laptop or your tablet as we speak there's hundreds of teachers working with our students today they're all ESL certified they're all native you pay a flat fee every month it's very affordable is about a fifth of the cost of your traditional school and you're going to get unlimited access to these teachers that are committed to your fluency and actually what happens is then you're not just taking notes and learning the past progressive tense of a verb to actually talking and losing you know that fear of speaking which makes a big difference when you have to go into a job interview when you have to travel and have to do any of these things it's invaluable invaluable if you don't speak English here you know you can't communicate you can't hear you're actually that into just like if you were backing to Bower any other country you know worldwide English is always being the language of business being the language that's opened the doors for you everywhere you went the last year long hundred thousand people in the company and you know we're ventured funding to raise over a hundred million dollars from some of the premier VCS here in the US Wow all right you've been busy we had been very busy I always had a passion for languages actually grew up traveling around the world my dad as a diplomat to live in nine different places got to see a lot of different cultures in English was I realized not just the language but it's a tool for success and a tool for global communication we see it as really a transformational step in your development normally I advise startups against running expensive television ads the conversion rates usually are pretty low and it's really hard to track how well you're actually doing that said most of the companies I'm advising are looking at the American market I'm not necessarily looking at the Latin American market what's so interesting about this is for open English they found a way to build a brand through television spots probably because so many of their market audience isn't spending a dominant amount of their time online just the watching a lot of TV so the bottom line is if you're gonna do marketing understand your market we did a commercial agreement with a TV station in Venezuela actually where they helped us shoot a couple of TV ads were very simple and put it on TV you know that generates 6,000 leads that month keep in mind we had a call center with like three wireless phones in our inner small offices it was like okay this is real people do want this product yeah how much of opening wishes success is because of those campaigns and in particular how much that can you tribute to your own ability as an actor at the time when we started we didn't have any money so we needed somebody goes bilingual and we look Latin so he said and res why don't you do the other guy for this first commercially yeah we see where it goes and the first commercial went viral and it was very hard to change you know the faces and the ads that I didn't what five years and I'm still doing ads every month we we go nice to actually write our own scripts and we micromanage that process you know a lot to do a new ad every month and the last tab that we had was that called persuasion it got 12 million views on Facebook the day before it went on today so the whole following there that's just waiting for the next open English commercial do an app presumably you get stopped on the streets yeah so when I go down to what AM it's a bit of a production so we have these uh derailleur disguisers are sweet seriously yeah they they go with us if you can't get for the airport you like the minute I sit down with my cereal are instagramming and tweeting and all that that's and you look and you get to the airport and people waiting it's a bit of a cook there's different methodologies on how to teach English the the methodology that we find to be the most successful as immersion will run you know a hundred thousand students of live instruction classes every single month so we teach classes 24/7 every hour of the day every day of the week and so there's been a lot of human interaction right so rather than you just trying to go through a lesson on your own we actually supplement that with a lot of live instruction to talk to many teachers now this platform is designed for native Spanish speakers to be learning English I wish I spoke Spanish we're gonna still walk through I'm pretty good at English that's really process can you walk me through what we're doing right now so we use a combination of methods to teach our students so on the platform the students can choose between practice units and lessons or live instruction practice allows them to watch videos and just really kind of go back and forth say out loud they can get pronunciation live instruction which is what you're saying here is speaking with a native English teacher so unlike some other language programs they actually have access to teachers 24 hours a day seven days a week they're native English teachers that they live across the world but they're generally Americans became English teachers they can actually learn from their little village wherever they're at and really understood that opportunity to speak with someone who speaks perfect English without an accent which you don't see in most countries it's really hard to find a teacher on-site that you know that is an American that speaks perfect English these are educated highly educated they come with a strong missile background so they are bringing a skill set to open English that we don't have right we are contracting these teachers for a reason we really hope to find teachers that have a great sense of empathy this process learning the language is not easy specifically for an adult and so our teachers we hope that have had that experience which is why we hope to find teachers that also speak Spanish or Portuguese they've gone through the process before and so they're definitely much more empathetic to how a student learns we have a big marketing function that basically just drives a lot of traffic to our website which we capture lead information and then basically we become a call center you know we have a very aggressive sales team we have a pretty consistent call campaign that will call you within the first 30 days to try to convert you onto a student so all that started with a handful of people in you know an apartment in Venezuela which then grew to a call center that which then expanded into you know the rest of the town you know learning English is hard so I mean there's a lot of engagement that needs to take place we'll call you when you're not logging on so how many different call centers do you have right now we have three call centers today about 10 percent of our business is from Venezuela today so we have all the call center operations supporting the sales and service those students there we then have the rest of the team so all Spanish speaking Latin America it's service out of Bogota Colombia and we have you know a between sales and service we have another 500 reps what we there and then we have started and launched Brazil which is our newest market but we've been there probably about 18 months and when we started Brazil we set up operations in San Paulo so we have got a hundred reps there across sales and service what I think about this and and where it is today I it is easy to get caught up with like holy with all the success I want to go back I want to bring it all back to where it started I had literally $700 left my name and I bought a ticket with my holes and I took my 700 bucks and remember on the flight just feeling this sense of weight that my co-founder had told me look if you don't come back with a check and you know some way to sustain this thing I'm out I have to you know to generate some money for my family and pretty much everybody was on that same boat so I literally had like a two-week window to you know actually get a check from someone it is and people there they understood how to invest in startups but they didn't really understand Latin America so when trying to sell them on this vision of an $80 to $100 a month description product for the emerging middle class in Latin America that we were going to promote through TV commercials it was completely contrary to everything they they were seeing it okay but Netflix is $7.99 even charge $80 to someone that may not have a credit card really so it was very hard to raise money from VCS and so we started raising money twenty thousand fifty thousand dollars at a time to two years but we raised two million dollars and and it was you know there were so many moments I think youyou I don't know what if you believe in faith or God or you don't but I think there's so many moments during that that the company was about to shut down and literally like something happened the day before that changed our course and we would not be here if it weren't for that one person doing that one specific act open English has raised a little over 120 million dollars and I really hate it when ever I see fundraising announcements get celebrated as if it were some big milestone look that's not your money right you're giving up equity in exchange for money that you'll put back into the business to hopefully grow it to justify that investment in open English's case they want open into a new market Brazil which is a different language very different culture and it's a question whether or not they can do it because that's what they have to know they have to grow and it means expanding its new countries will see if they're up for the challenge it can't be as simple as fine to replace yeah right it's gonna be more complicated how do you go about Duke launching a new country well I our platform is very English focus there's very very little Spanish on our learning platform so that does allow it to transfer events from pretty easily the only thing I would say is there some entry-level things like if you don't know any English there's some basic stuff so that's where we tend to focus our you know our product and try to optimize up for the different levels of Spanish or Portuguese or wherever it might be but even beyond that I would say that's just like the perspective if you take a look at the people side of the business right you know selling to different countries you know I think you know accents are extremely important and making sure that you have you know the right sales rep trying to convince you that you want to you know purchase the platform here and I don't think it's as simple as you know just one dialect or you know one approach I think what open English has been able to figure out is you know what is the value proposition for my country instead of just trying to spread it like vanilla across that you know like just icing the cake right rather than just ice the cake you know ultimately you know be a little bit more sophisticated about it and start thinking about individual markets and how how do you keep this scaling right because like software is great at this humans not great at scaling and when you're doing someone like education we're great teachers is such a funny little particle business but how do you keep that growing and keep the quality at the same time I think it's been a little bit of our secret sauce right where lots of companies even some in the u.s. that are doing language learning they wanted to create great software and it wanted to create software that would not require a human to teach you and we always work the opinion that you need a great teacher to succeed and especially if you're learning a language you need to be able to speak and have a conversation and feel comfortable listen to different types of accents and understand them and get comfortable with your own voice and so we went about using technology not to eliminate human interaction but to make it more efficient what we did is we spent a lot of time thinking about like what are those poor customer facing processes that need to be standardized to a point that you know work but are still able to be localized so we've basically automated all those processes as much as we possibly could and then we supplemented with you know bodies when necessary speaking things in on scale right how do you build and maintain a great network of instructors I think ultimately if you can set up like good operations where you have a funnel that is constantly out marketing to new teachers and bringing them on certifying that they fit open English and then setting them up for success you know at open English you're always gonna be ahead of it do you think there's any kind of an upper bound to that where you just the demand for teachers just outpaces your ability to create the supply um I do I don't foresee us running out of teachers I think we may have to change our way it's right we may have to be a little more innovative on how we go out and we find those teachers and bring them on and I think open English has built a brand in the marketplace as well where you know teachers are reaching out to us now we're very picky with who we allowed to become teachers and I want to hold that quality standard a certain level so we want to maintain that but I think they will be able to figure it out as we move forward to the software this is blackboard yep so you've built on the curriculum and then you didn't have to write your own software for this you're just using a blackboard to power the actual teaching correct we use Blackboard Collaborate and essentially just allows us to access our students across the world is there an option for video the teachers are able to an extra students are able to do video we don't use the video for the most part because most students and South American countries don't have the bandwidth to handle it if the sometimes the teachers will try and of save it if any of the students has an issue we don't want to cause a problem with them sure are we doing well in this class I can't get a sense so probably not we're not doing labs for companies that are here in Miami today getting started or maybe they want to start the company here well what is the board of the yet what are the strengths of the Miami tech community it's very tough to if your main market turns out to be a Latin America to be on the west coast and to fly you know for a day and then get down to Sao Paulo or Argentina or Bogota or Mexico City so move the company to Miami you can be in a place where there's highly international highly diverse write the climate helps right but now in on top of all of that which is fantastic you actually have a really cool cultural community you I basically went to Twitter and said I'm coming to Miami what is these startup I need to meet everyone said open English well I mean Andres is just question right what is it gonna take to create more open English is here in Miami we need to sort of create more stars and to turn those stars and to funders and mentors of the next group yeah you know this sure that's a sort of virtuous cycle of course is the big prize that all cities are active oh yeah and so a guy like Andres is now he's on the board of endeavor which is all about finding those high potential entrepreneurs and turning them into stars and then having them from the next helping the next coming up there's two and a half million people in Miami and about 40% to 50% of those people have not reached they walk great and half of those people never reach the eighth grade so you know we have a difficulty attracting major technology companies to come down here to to South Florida because this companies are looking for people who are trainable you know this is a service community so a lot of these people are working here is all you know cleaning all their rules or cafeteria servers or you know whatever it is because of you know they lack of the language and a level of education and so on and so forth and so what's what's the future no but English where is this going - well you know we are still continuing to deepen our presence in Spanish 15 Latin America and in Brazil we feel like we're just scratching the surface we've already enrolled about a quarter million students in the region but we think that you know we should be 10x the size in the next few years because there's so many people that need English as a tool for success now that we understand that the power of EdTech and how it transformed the lives of our students what else can we do to further that transformation in their lives and I think we're talking a lot about that program and perhaps my most important question when are you going to appear in one of the commercials I won't be appearing at first all right that's on during this thing I'll let Andres alright you're so sure the commercials showing yourself sure is the face of the company so I'll let him participate in tomorrow you'll be busy running the operation I will be great start-up communities are born when entrepreneurs realized the unique strengths of their cities and then embrace them and utilize open English is doing just that remember this company started out in Caracas and it moved to Miami all those jobs all that innovation could have stayed in Venezuela but it came to the United States of America clearly more and more companies are gonna be involved in the Latin American market as that region continues to develop they're gonna be more opportunities and I want those opportunities to happen in the United States we've already got companies like Open English that are leading the way the question is who will follow open English is conquering the already crowded field of online language courses but by keeping things focused and simple it's quickly standing out among the rest so how can you use these same ideas to make your business succeed try starting with your website make sure your site is responsive and it's easy to use across all devices as well as giving customers the ability to make their online purchases using phones and tablets try utilizing services like PayPal for easy mobile payments most importantly keep everything simple and focused learn what your customers want and richer sight of any confusing extra features you'll be on your way to success in no time for more business advice check out ATT business you