You’re running a successful business, and are internationally-minded about the next step for international expansion. Startups are growing at an unprecedented pace in Europe with plenty of scale-up success stories. You’d like a place in that race but perhaps have some questions on specific success factors. There’s an obvious first and important question: What’s a good type of tech company to take to Europe?
We could be lazy and answer that, considering the growth in tech adoption across all verticals across Europe in the past year, any tech company could excel anywhere. But that wouldn’t do you any good. You have limited resources to dedicate to expansion and you can’t afford any misfires.
You want to take that first step with your dynamic new venture, but also to remain competitive, both technologically and economically, in what can sometimes seem an oversaturated market. It makes perfect sense to research and choose the best type of tech company to take to Europe.
Although Silicon Valley often overshadows as far as location goes, tech startups and scale-ups in Europe are growing rapidly and gaining ground in the world market. There are over 70 European unicorns that achieved billion-dollar valuation this year alone. It’s true to say that Europe provides a large and varied consumer market, although it’s not a one-size-fits-all scenario, and some tech companies are better suited to particular countries over others. Let’s look at ‘what fits where’ for tech startups in Europe.
Requiring the least amount of funding, product players dominate a large sector of the European tech market. B2B SaaS businesses and neobanking are unsurprisingly top of the list — almost half according to McKinsey — and both are excellent choices when it comes to selecting the right type of tech company to take to Europe. After all, cloud computing means you can launch anywhere more cheaply. Post-Brexit, Berlin is firmly on the world tech map as a vibrant startup hub.
Neobanks — challenger fitech digital banks — are undoubtedly a major success story in Europe. Five out of ten of the top neobanking success stories originate in Europe, namely Revolut, N26, Monzo, Monese, and Atom. All are U.K. headquartered with the exception of N26 — the first mobile banking platform of its kind — which is based and was launched in Berlin, back in 2013. So, we conclude that while the U.K. and London in particular may be the hotspots for fintech, this can also make for a saturated market.
Exploring and expanding further afield to other European locations with your fintech is a good idea, including Germany, France, and of course, avoiding the language barrier in Ireland, where the money transfer company CurrencyFair is headquartered and has offices in the U.K., Greece, and Poland as well as further afield in Asia.
What about scaling up your fintech business with future growth? Scalability can be quickly and easily obtained by simply focusing attention on three things:
Once scale is attained at a basic level as a result, expansion to higher-margin products and collaboration with — in the case of neobanking — other fintech companies, this provides the opportunity of cross-selling and stickiness.
More stats in favor of Germany to take your fintech to Europe — in case you are still in any doubt — as recently reported by IBS intelligence, four German companies are top of the leaderboard: N26, Raisin, Mambu and Solaris bank.
As with all things, global expansion can be a bit of educated trial and error. So scalability is also about adopting an expansion plan — like via sales outsourcing — that maximizes flexibility allowing you to scale up and down and move to more profitable markets.
B2B SaaS is the top player in the European market and the success of your prospective startup in Europe depends heavily on how you approach and optimize your planned new growth. You’re already successful in your home market, but you need to have the ability to translate this to your target European market and customer profiles you’re targeting. You need to be strategic about how you reach those new prospects — in their native languages — and of course don’t forget to take a long hard look at the competition.
Once you have performed this research diligently, you will be confident, ready and able to take your B2B SaaS tech startup to Europe. Over the last two years, we’ve seen a huge increase in SaaS startup success stories in Europe with no signs of slowing down. In fact, the majority of our clients are in this space, nailing their growth with proven, workable, measurable strategies.
Carbon-neutral solutions and green energy tech are subjects on almost everyone’s minds, particularly in the light of the recent COP26 climate summit held in Scotland. Green energy technology is the key to achieving the Paris Agreement’s call for net-zero emissions by 2050 — as well as biodiversity, sustainable buildings and net-zero pollution.
The urgent requirement for regenerative infrastructure solutions has paved the way for new and exciting tech start-ups in Europe, making this a great choice of industry for your growing tech company, joining over 800 climate tech companies already based in Europe. Germany and the Nordics dominate the European green tech scene, with the U.K. and France not far behind.
We see huge traction in Europe with our green startup and scale-up clients, including Yara International and their recently launched Agoro Carbon Alliance, APlanet, ENGIE Impact and InPost, which combines software and hardware in a real-life solution.
In the world of telecommunications and digital tech services, there are plenty of success stories. Elisa is one such success. With 2.8 million customers in Finland, Estonia and internationally using digitalisation to resolve issues that are important to people, society and sustainable development. Seeq is one of our American clients helping drive European Industry 4.0 with predictive analytics for process manufacturing. We are also proud to be representing Interop Technologies as they help bring 5G to Europe.
The Digital Services Act seems to be the only fly in the ointment for digital tech services and start-ups in Europe. Originally set up to protect users and regulate digital services, it has come under a lot of scrutiny and criticism for its alleged incompatibility with human rights.
Following that Germany is central to many fintech companies it makes sense to take your cybersecurity tech start-up there, to a solid ready market. These are the top cybersecurity companies in Germany providing maximum operational security and guarantees against targeted cyberattacks. The Netherlands too, has proven itself to be a good choice location, as in the case of our client Zivver, a cybersecurity startup that provides unique protection against data leaks from both internal human error and external hackers.
Whatever your vertical, one thing to remember, especially in the wake of the recent pandemic, is not to delay your expansion into Europe. Local competitors will seize the opportunity to fill the vacuum you create by any procrastination and you will lose your place in the race, so once you have researched where fits best for your tech business, just go for it!
Also Read: Where to launch your SaaS company in Europe