Abstract We conducted an industrial case study of a distributed team in the USA and the Czech Republic that used Extreme Programming. Our goal was to understand how this globally-distributed team created a successful project in a new problem domain using a methodology that is dependent on informal, face-to-face communication. We collected quantitative and qualitative data and used grounded theory to identify four key factors for communication in globally-distributed XP teams working within a new problem domain. Our study suggests that, if these critical enabling factors are addressed, methodologies dependent on informal communication can be used on global software development projects.