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Summer Stories – Chris Tyler, Istanbul

I spent my summer in Istanbul working for yemeksepeti.com (Turkish for foodbasket.com), a food-focused internship that gave me the chance to test the limits of my stomach and learn more about international business. I found the internship through Endeavor, a US based non-profit that provides services to its network of entrepreneurs.

Yemeksepeti is an e-commerce platform for restaurants that deliver. A consumer can browse restaurants that deliver to her neighborhood, place the order online, and have the restaurant (not yemeksepeti) deliver the food to her house. For consumers, yemeksepeti is a replacement for a drawer full of delivery menus and a phone call to the restaurant. For restaurants, it’s a source of new orders and a way to provide targeted marketing to potential customers. Former New Yorkers will recognize this concept – it’s the same business as seamlessweb.com, although with less of a corporate focus.

Yemeksepeti takes a small commission for each order that it sends to a restaurant. It does not charge any kind of recurring membership fee to restaurants, so restaurants only pay when yemeksepeti sends them business. This summer yemeksepeti was processing about 12,500 orders a day, and this number continues to rise as they expand to new cities in Turkey and internet penetration in Turkey increases. Restaurant marketing is yemeksepeti’s other source of revenue. Restaurants can target customers through yemeksepeti’s 400,000 member user base with email and website marketing that is much more effective than distributing menus to apartment buildings.

I spend my summer helping yemeksepeti develop an international expansion strategy. Their business is very scaleable, and there are lots of countries and major cities that don’t have their type of service. We narrowed down a long list of fourteen countries to five top candidates, and we visited two countries for market research visits where we met with restaurant owners and consumers. I also designed how they would expand to these new countries, helping the founders decide what functions should be centralized in Istanbul and what functions would be run by the international branches.

But enough of the details about the company and what I did. Let me give you my take on the most interesting parts of the experience:

The rest of the world is catching up with America very quickly. I didn’t know what to expect from a home-grown Turkish e-commerce company, and I found that much of yemeksepeti’s success came from strengths that American companies are usually known for. The company’s website and sophisticated order processing system were all built in-house by a top-notch group of programmers, all born and educated in Turkey. The three founders (all 32 years old) understood strategy and competitive advantage as well as any of the executives I worked with at Fortune 500 companies as a consultant before business school. And yemeksepeti’s cutting edge hardware and software came from the same multinational companies that would supply any Silicon Valley startup. I was impressed to find a company that was best in class globally, not just on the local stage.

Many of the factors that made yemeksepeti an exceptional company were areas where I always thought of the US as the clear leader of the global pack. I don’t want to imply that America is losing the qualities that have made it so strong, but I saw that other countries are picking up on what American businesses do well and bringing those innovations home. And, after competing successfully in local markets, many of these companies will be looking to compete in the global marketplace. In the future we’ll probably be seeing a more interesting and unique types of multinationals, such as the Turkish technology company with an American intern looking to invest in Poland.

Learning a new language is really hard, especially when that new language is Turkish. Fortunately (or unfortunately, depending on how you look at it) about 90% of the people at my company didn’t speak English. I bought a “teach yourself Turkish” book and, with the help of my financee Selin (an Istanbul native) threw myself into trying to learn a new language. Like many Americans, I had a life-long flirtation with Spanish that was motivated by academic requirements more than a desire to speak another language well. This was my first time feeling like I really needed to learn a language to communicate with others, and it gave me even more respect for people who have learned another language well.

After a decent amount of studying, I did leave Istanbul able to get around town without English and hold a basic conversation. At work, my new language skills created lots of opportunities for in-depth conversations such as “where do you live?” or “this meal is very delicious.” But the people were really warm and friendly, so it was all good. Now I’m mortified that the HBS Turks will want to test my conversation skills after this article is published. Please go easy on me, and remember that I’m much better at conversing after a few drinks.

Working across borders is incredibly complex. The market research vists helped me realize how many things a business needs to understand when looking to expand internationally. Some differences between countries are superficial and easy to pick up on. However, many other differences were more subtle and harder to find a good answer for.

Thinking through all the questions associated with starting new yemeksepeti operations in a foreign country makes my head spin. For example: How are consumer and business behavior different from our country? What kind of local management talent is available, and what would we have to pay them? Does the government offer incentives for FDI, and do the laws provide strong foreign investor protection? To complicate things further, there’s rarely an objective answer to these questions, and different sources will give you different opinions.

The experience of trying to expand internationally made me appreciate how lucky American entrepreneurs are to have such a large home market. The fact that the US also has (more or less) a common language, currency, and laws also make growing a business much, much easier.

Istanbul amazes me. It was my fourth time visiting the city but my first time really living there. My internship was great, but being in Istanbul for eleven weeks was by far the best part of the summer. Every night Selin and I were out exploring different corners of the sprawling, seemingly endless city. I could write another article on why the city is so fantastic – millenniums of history, warm and inviting people, and some of the world’s best food, to name a few. Instead of running through the full list I’ll end the article by encouraging you to visit. Let me know if you ever decide to visit – I’m happy to loan you my “teach yourself Turkish” book for when you’re on the road.

September 2, 2008
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