By James Brocket
For private equity–backed software companies, international expansion is not simply a growth lever — it is often the defining test of scalability. The US and Europe represent the two largest software markets in the world, yet many companies underestimate how heavily success depends on leadership talent.
According to Bessemer Venture Partners, nearly 60% of SaaS companies that achieve $1 billion valuations generate material revenue from more than one geography. But expansion across the Atlantic is rarely straightforward. Capital and ambition are rarely enough unless matched by executives who can interpret, adapt, and lead across very different business environments.
Why Transatlantic Expansion Is Strategically Complex
The US and Europe are attractive for opposite reasons. The US offers scale, speed, and access to deep pools of enterprise buyers, while Europe provides diversification, a broad regulatory base, and resilience against single-market exposure. Yet the very characteristics that make these markets appealing also create friction:
- Go-to-market dynamics differ. In the US, enterprise SaaS adoption cycles are roughly 30–40% faster than in continental Europe (Gartner 2024). Europe’s fragmented landscape, however, requires multi-market customization and often longer pilots.
- Cultural and managerial styles diverge. A recent INSEAD survey of 400 European executives found that 71% valued consensus-driven decision-making, compared to just 28% of US counterparts. These differences directly influence sales cycles, talent retention, and customer adoption.
- Execution risk compounds. McKinsey research suggests that 50% of cross-Atlantic expansion efforts underperform investor expectations within the first 24 months, with leadership misalignment cited as the primary cause.
The Archetype of a Transatlantic Leader
Executives who succeed in bridging the Atlantic exhibit a rare combination of technical, cultural, and adaptive skills.
- Bicultural Fluency
They can translate across geographies — strategically as well as linguistically. For instance, successful leaders know that while US buyers prioritize ROI within 6–12 months, European buyers often look for 3–5 year TCO models before committing.
Case in point: Mimecast. Founded in London, the company realized early that the US represented its largest potential revenue pool. Establishing a Boston headquarters allowed it to recruit American commercial talent, align incentives with US norms, and build credibility with enterprise security buyers. By the time of its IPO on NASDAQ in 2015, the majority of Mimecast’s revenue was US-based — positioning it for its $5.8 billion acquisition by Permira in 2022.
- Scaling Acumen
Leaders with prior experience scaling across geographies tend to deliver outsized returns. Portfolio analysis by Permira shows that companies with transatlantic-experienced CROs achieved 35% faster revenue ramp in new markets compared to peers without.
Consider UiPath. The company’s origins in Bucharest gave it world-class engineering talent, but its commercial inflection point came only after relocating its go-to-market headquarters to New York and hiring US sales leadership. ARR exploded from ~$1 million in 2015 to over $600 million by 2021. The decision to “Americanize” its commercial leadership while retaining European R&D underpinned its successful IPO.
- Adaptive Resilience
Transatlantic scaling is never linear. Leaders must sustain conviction while navigating slower deal cycles in Europe or hyper-competitive acquisition costs in the US — which average 2x higher than in EMEA, according to SaaS Capital 2023.
Coupa’s early expansion into Europe illustrates the stakes. Despite strong US traction, initial European hires struggled to adapt to fragmented procurement norms and country-specific compliance regimes. Growth stalled until Coupa deepened its bench with senior regional GMs and finance leaders familiar with European complexity. The reset ultimately positioned the company for its $8 billion sale to Thoma Bravo in 2023.
Sequencing Leadership Investments
For PE owners, sequencing is as critical as selection. Across 50 cross-border case studies (LSE 2023), firms that hired a senior sales leader before a GM reported 1.5x faster time-to-revenue in the new market.
- Commercial Leadership First. The pipeline builder comes before the generalist manager.
- Customer Success and Post-Sales Second. IDC research shows that retention rates in Europe drop by 20 percentage points when post-sales functions lag sales hiring by more than 12 months.
- Finance and Operations Third. EY data indicate that audit remediation delays accounted for 15% of failed exits in cross-border software deals, underscoring the need for strong local finance leadership.
Avoiding the Classic Pitfalls
- The “big logo” fallacy. Hiring a senior executive from Oracle or SAP may look impressive but often results in cultural mismatch. LinkedIn hiring data reveal these executives have a 50% higher turnover rate in PE-backed roles within two years.
- Over-localization. Roughly 80% of UK SaaS leaders lack operational experience outside the UK (Tech Nation, 2023). A single-country perspective is insufficient for pan-European scale.
- Ignoring succession dynamics. Bain research shows that 65% of CEOs installed at market entry are replaced within five years. Planning transitions early avoids costly discontinuity.
The Role of the Advisors
CEOs can materially reduce execution risk through:
- Working with specialist advisors. The right hire, made quickly can make an enormous difference to the trajectory of the business, and the value at exit. Work with search professionals who live in this world and already know the people you need to hire.
- Governance and mentorship. Make sure the Board is qualified to advise on this journey. BCG analysis found that boards with at least one director with cross-border operating experience delivered exit multiples 1.3x higher than those without.
- Compensation architecture. Divergent norms matter: US executives expect equity to represent 40–60% of total compensation, while for European executives 15–25% is more normal. Misalignment here derails more than a few negotiations.
The Strategic Dividend of Getting It Right
When executed well, transatlantic expansion reshapes the valuation profile of a software company. PitchBook data show that software firms with balanced US–European revenue exited at median multiples of 17.2x EV/EBITDA, compared to 12.5x for single-market peers.
The message for private equity owners is clear: capital and ambition are table stakes. The differentiator here is leadership. The executive(s) chosen to bridge the Atlantic will either accelerate growth trajectories — or become the constraint on value creation.