Not long ago, scaling outside of your home country was recommended if 25% or more of your business came from international markets. Now, while this is still a relevant benchmark, software and SaaS businesses are more heavily regulated, banking is more complex, and customer expectations are higher than ever — making the question of when to expand internationally more complex.
Here are some things to think about:
Any move into new markets should be in support of your business’ overall mission and vision. Your starting point should be to ask yourself whether or not your business’ mission extends across borders.
For example, tools like asana that help connect remote teams have a clear business case for selling globally and connecting international teams. If you’re solving a niche or more local problem it might not be the right time for you to take your product into a new region.
2. Market demand
You might be gaining traction in multiple countries but you can’t (and shouldn’t) try to tackle ten new markets at once. Research new regions and look at your existing data to determine where you have the best market fit, and which market will have the best return on investment (ROI).
- Where you’ve seen the most traction
Look at where your traffic and new customers are coming from. You might find that there’s an audience who already sees the value of your product, waiting for it to become more accessible.
- The competitor landscape
If the problem you solve is felt in a major market, like Europe or the US, and there isn’t a solution like yours available, it could be a good time to establish your brand and solution.
- Where your product and business has cultural alignment
Your product is likely already more accessible in some markets. In others, you might need to make significant changes to localize your offering.
Ultimately, you need to decide where it’s worth spending your effort, time, and money (particularly if you plan on setting up local entities).
3. Market landscape
As you evaluate new markets, factor in the requirements for selling there. Do you need to have a local entity or local representatives? How long does the registration process take? And when you're registered, what other regulations do you need to be aware of?
Setting up locally is resource heavy because you’re bound by regulations, so understanding where you have to be local and where you need to be local is key.
4. Business readiness
It might make sense for your business to expand internationally but is it actually ready? When establishing your business in new markets you’ll need resources and processes to manage your team, support your customers, and scale your business effectively. With a lot of focus on making new markets successful, you need to make sure that this won’t take away from, or negatively impact, other parts of your business.
Your go-to-market strategy plays a part here too. If you’re a product-led business, your processes are potentially more repeatable and therefore scalable across markets. If you need boots on the ground to manage your sales-led approach, it will take longer to get up and running and your processes will likely need to be more bespoke to each region.