Twitter beefs up in London, but is Europe just a cash cow?

Code Street, London used under CC license by Flickr user DC Input

Twitter has spent the last few months scouting a European HQ, but it seems that plans to expand the company’s London office are now rolling out in earnest. As of today, two important positions have been filled. Jessica Verilli, who has been working in corporate development at the company’s San Francisco base, landed in London this weekend to begin what she called ”my next chapter”. Meanwhile the company has also hired a new European head of communications, Rachel Bremer — an experienced hand on Europe’s tech public relations scene, who had previously represented a wide range of European startups and investors for Spark PR.

They aren’t the first in Twitter’s London team, of course. There was the recent acquisition of Tweetdeck last month, and before that, the appointment of former Googler Tony Wang as general manager of Twitter UK. That decision that was particularly notable since the company has chosen a career lawyer (Wang was a counsel at the Googleplex) to head up efforts in a country that is already developing a tricky legal relationship with the service.

Today’s moves indicate that the team seems to be assembling rapidly — but the real question is what Twitter’s shape European operations will have in the longer term.

It’s not unusual for American technology firms and startups to open European offices as they expand, but the vast majority of them are focused on sales and publicity. Some see the continent’s large, technologically-engaged population as a cash cow waiting to be milked; others recognize that managing local relationships (particularly with the press) is important for growth.

Sometimes it’s simply the case that opening an office inside the European Union makes some legal and financial issues easier to deal with (being able to shift corporation tax liabilities around Europe, for example, are one important reason that Ireland and Switzerland have become corporate centers for a large number of American corporations in recent years). Only a handful of businesses go further, and try to build up significant engineering or product development outside Silicon Valley — usually preferring to drag employees across to home base, where they can be more easily integrated.

Looking at Twitter’s hiring strategy in London, it looks pretty much like the business is drawing its tactics straight from the standard playbook. The open job listings suggest it’s mainly recruiting a sales team in London — positions as account executive and sales account manager are still open, for example.

That doesn’t make it unusual, of course. It’s the model followed by Facebook, which has a London office that is focused almost entirely on sales. Indeed, European operations are run by Joanna Shields, a genuine sales wizard who was so effective at cajoling new businesses into the digital world that she was largely responsible for turning Bebo from just-another-social-network into a site that was attractive enough to be purchased by AOL for $850 million. That acquisition ended disastrously, of course, but her reputation was sealed.

The trouble is, while sales are really important — particularly for a revenue light business like Twitter — focusing on sales and marketing above all else represents a real missed opportunity. With Facebook, as with many other companies, it’s apparent that Palo Alto drives the product agenda while London merely tries to monetize. Compare that with Google, on the other hand, which has spent a lot of time hiring talented European developers. It’s now the case that a significant proportion of Google’s mobile efforts are driven and built out of its London offices. It more successfully embeds in the local culture, feeds back into the company strategy and enhances the business.

The truth is that not every engineer in Europe wants to live in Silicon Valley, and not every engineer sitting in San Francisco understands the complexity of foreign markets — or the potential that they can hold. Twitter already has a headstart with the developer community thanks to the good fortune that Tweetdeck is based in London, but Europe will only truly benefit if that move becomes the rule, rather than the exception.

Photograph used under Creative Commons license, courtesy of Flickr user dcinput