Global Expansion Strategy – Go to Market of SaaS and Software companies
Successful stories of globalization and international development of SaaS and Software companies. How are they spreading ?
Many software companies aspire to become unicorns and implement international expansion strategies. European firms are increasingly targeting the US market, while American companies rapidly expand globally. What are the challenges and success factors for software companies going global? International market conquest is essential for software publishers, and global expansion is a survival kit.
The ones making global expansion part of their DNA are described as Born Global
Harnessing Data and AI for Global Growth
The impact of data and AI on international software development cannot be overstated. These technologies empower SaaS companies to create smarter, data-driven solutions tailored to specific market needs. Learn how US firms like Salesforce and Adobe leverage AI and data analytics to fuel their global expansion.
Crafting the Right Expansion Model
Choosing between organic growth and growth through acquisition is a critical decision for SaaS companies eyeing global markets. Dive deeper into the strategies of US-based giants like Salesforce, which successfully expanded globally through a mix of organic growth and strategic acquisitions.Direct establishment strategies are justified in large markets like the USA, while subsidiaries and integrators are preferred distribution methods for digital companies.
Choosing between organic growth and growth through acquisition is a crucial strategic decision for software publishers expanding internationally. Each approach has its advantages and disadvantages, impacting scaling, time to market, and overall success. Organic growth offers control and a consistent corporate culture but may take longer to establish. On the other hand, growth through acquisition provides rapid expansion but comes with integration challenges. A mixed model can offer a balanced approach, leveraging the strengths of both methods for sustainable international success.
Achieving Localization and Critical Mass
Explore how US SaaS companies like Slack and Zoom achieved critical mass and credibility by expanding globally while maintaining strong localization strategies. Learn from their approaches to entering new markets and establishing a strong foothold.
To reach critical mass, attract investors, and establish credibility, some companies choose to relocate. This approach facilitates access to funding and market expansion. For example, Dataiku, a French company, relocated its headquarters to New York in 2017, leading to significant growth and investment opportunities.
Tailoring Implementation Models by Country
Discover how US-based SaaS companies such as HubSpot and Zoom tailor their strategies to each market’s unique characteristics. By understanding local preferences and regulations, these companies have effectively penetrated diverse international markets.
Perfecting Product-Market Fit and Differentiation
Learn from US SaaS leaders like Microsoft and Zoom about the importance of product-market fit and differentiation in international expansion. Discover how they identify and address specific market needs to gain a competitive edge globally. Understanding customers’ “must-have” and “nice-to-have” features is essential. Minimizing the need for product adaptation is crucial, indicating market relevance.
Case Study: Zoom’s Global Expansion Journey: Explore Zoom’s remarkable journey from a US-based startup to a global powerhouse in video conferencing. Learn how Zoom strategically expanded into international markets, adapted its product offerings, and capitalized on local opportunities.
Global expansion Saas Case study: Kyriba
Kyriba is the world leader in cash management solutions. Recently acquired for $1.8 billion. Over 2000 customers and a presence in over 100 countries worldwide. Launched in 2003, the startup has now become a unicorn valued at over $1.2 billion. It has more than 1000 employees. Kyriba, an American SaaS, founded in Paris, is a spin-off of the company XRT. It aims for a revenue of $500 million this year.
Originated in Europe, Born Global in the United States
Shortly after its creation in Paris, Kyriba settled down and emerged in the USA. Kyriba is now the industry leader in the United States. With more than half of its turnover and a market share of more than 20%. Priority was quickly given to the US market, which is the world’s largest software market.
Become an American company and raise funds
In 2003, the choice was made to establish the head office in San Diego and to become an American company. This strategy raised over $80 million, which at the time would not have been possible had the company remained European. In 2019, the company raised $160 million and was acquired by Bridgepoint.
A regional approach in the USA
In view of the size of the US market, it was essential to adopt a regional approach. It is complicated to develop simultaneously in the East and in the West of the United States. After San Diego in 2003, Kyriba opened offices in New York in 2008.
A strong European presence
Alongside the American journey, Europe has not been left behind. Well established in Europe, mainly in France with a 35% market share, Kyriba is also hitting records in Spain and England. France is also the country where a significant part of the product, engineering, and development teams are located. There are more than 300 employees in this area.
A survey about where SaaS companies land in Europe and how they choose their destinations can be reviewed here
Expansion in Asia and market strategy
In 2012, Kyriba started expansion in Japan where the company is rapidly developing. A close business watch has been set up for Southeast Asia and, more particularly, China. This huge market is then the next major target. Half of the world’s financial flows are made through Asia, which makes it a destination of choice.
The international development model
It began with an analysis of the market opportunities and the possibilities of making an acquisition. The conclusion was that the market, the targets, and the timing were not right for an acquisition. It was then decided to open offices on the spot and to recruit sales representatives to attract the first American customers. It is difficult to establish itself in the American market for a European company. Its financial strength and ability to scale are often questioned.
It was only after 3 years of effort that the signs of success appeared in the United States. It was decisive to win major logos, in this case, Airbnb, Uber, and Dropbox, and use them as reference. This leverage has established credibility with other prospects.
Expansion models differentiated by country
International Development by direct incorporation is justified in large markets such as the USA. To invest in less strategic markets or markets with a very different culture, other models are better suited.This is what Kyriba has done in the Middle East and in Japan. They formed a joint venture with SunBridge Corporation in Japan. In this territory, association with Japanese companies is essential. It is a model that works perfectly with a favorable acquisition cost.
Product Market Fit and Differentiation
The key to the success of global expansion is the adequacy of the product with the market. The office opening is combined with a mix of competitive positioning and differentiation factors.You must clearly be able to define the nice-to-have and must-have solutions offered to customers. Also, it is preferable not to have to adapt more than 10% of the solution or product. Indeed, if the need for adaptation is too large, it is often because the market is not relevant.
In the case of Kyriba, this was the case in Brazil. The required level of integration of taxation, legal, and finance did not make this market attractive enough.
The development of Value Added Resellers (VAR) was also a strong development axis. But this mode of distribution nevertheless requires significant resources with a team that manages the resellers. It is necessary to ensure the partner’s training and to coach them intensively at the beginning. This model is particularly suitable for small and medium-sized SaaS companies.
Team management and mobility
To build a strong international corporate culture, it is an asset to move employees between different countries. This also allows good dissemination of knowledge and is an element of staff motivation. At Kyriba, all employees go through an induction period in New York, San Diego, or Paris. This on-boarding is all the more effective if it is carried out with appropriate tools and methodologies.
Apart from on-boarding, transversal follow-up is essential. The implementation of global reporting provides visibility to all. Reporting and communication shall be done at the local and global levels. They are supplemented by quarterly meetings. The teams in each country are presented with the latest product and corporate developments, business results by region and future objectives.
At each stage of a country’s development, strong managerial engagement is a key success factor.
Corporate culture and knowledge sharing
To successfully conquer international markets, the transfer of knowledge and the globalization of teams is necessary. For this, it is necessary to develop a playbook with processes and to globalize its action plans. This is instrumental to common corporate culture. It conveys belonging to the same group in all its countries.
Building Diversity
A good example of building a strong management team with diversity is given by Sisence . In a fireside Chat with Emmanuel Facovi , Sisense CEO Amir Orad demonstrated the power of building an incredible asset for his company. that of leader in Artificial Intelligence, Sisense will illustrate the creation of an international management culture.
Top Management’s Focus and commitment
Kyriba has opted to be strong in its main market, the United States, before stepping up internationally, and to initially focus on a few markets. The international is a project that requires strong investments and a lot of focus. The implication of the leaders must be maximum. The start of a new country is led by example and hands-on help from senior management.
Conclusion Global Expansion Strategy SaaS
SaaS companies, software publishers, have a natural International DNA. The cloud has made it possible to globalize software solutions and apps are real growth accelerators for clients. The fact is that alongside tremendous opportunities, international business development remains a challenge with many pitfalls.
Kyriba has adopted an organic growth strategy. Many players raise significant funds from venture capital (VC) and bet on external growth.An International Business strategy allows to accelerate global expansion. It was not until 2019 that Kyriba made its first acquisition with FiREapps in the USA.
To effectively scale, international advisory is a strategic resource for SaaS companies. Experience, knowledge of markets, methodologies, and international culture are critical to lead an internationalization project to success. Beyond the implementation of the international development strategy, carrying out a good diagnosis and getting the right advice is essential.
Ipanovia supports you in your internationalization and expansion process in foreign markets.
We advise growth companies, start-ups, scale-ups, and their investors / VC towards a successful internationalization.
Your Global Ambition: Our Mission
Ipanovia is not just about expanding your geographical footprint; it’s about embedding a global perspective into your business strategy, ensuring sustainable growth and a competitive edge in the international arena. Our partnership extends beyond consultancy; we aim to be a cornerstone in your global expansion, assisting in everything from market analysis and strategy development to finding the right partners and navigating legal landscapes.
Our partner network covers local offices in over 20 countries and offers a high level of diversity, competencies, and experience.
Emmanuel Facovi – Founder. As former CEO / senior executive (Nokia, Coface, FCI, Kompass, Schneider, Areva…) his expertise consists in leading Tech companies (SaaS, marketplaces, Techs) with ambitious growth objectives in fast-changing environments.
He is a cross-cultural high technology executive passionate about new technology, innovation, disruptive models, and, above all, scaling your business globally. One of the most renowned Experts in Data, Marketing Strategies of Tech and Digital Industries,
As an« all-rounder» entrepreneur with a proven track record of building high-performing teams, he has a wide skill set ranging from Strategy and International Sales performance, also encompassing Finance, Marketing/advertising and legal/HR/culture.
He is an enthusiastic leader, keen on making sure that the office develops every day into an even “Greater Place to work”, gathering professionals of diverse talents who succeed together with a common vision in mind.