Member blog: Expanding into a new market – what your SaaS CFO should know

When evaluating SaaS companies for investment and growth opportunities, understanding the operational and financial intricacies of scaling internationally is crucial. As private equity professionals, recognizing that the CFO plays a pivotal role in this transition ensuring that the company remains compliant, efficient, and primed for expansion. From choosing robust accounting systems to addressing complex tax and reporting requirements, the CFO’s strategic decisions directly impact the scalability and sustainability of a company’s international footprint.

Based on our experience helping SaaS and other companies scale across over 40 countries, here are some of our team’s insights into what to consider – and how to avoid unnecessary headaches. For a CFO, expanding your business to another country with unfamiliar legislation, tax policies and reporting expectations can be daunting. The risk of inefficient practices, compliance issues and scattered data is real – and figuring it all out will take a lot of time.

1. Choose scalable accounting and ERP solutions early

One of the first steps is to select the right accounting and ERP solution. While local software might support all the local compliance requirements, it can lead to issues with scalability, consolidation, reporting, and billing complexity as you expand into more countries. A scalable, cloud-based ERP that supports multiple markets, currencies, and languages is recommended. Using the same solution in subsidiaries as in the HQ enables working within a single system instead of coordinating data from multiple ERPs.

If your CFO’s choice is NetSuite, they’ll be able to apply a Localization SuiteApp to ensure that they’ll meet the local compliance requirements. Localization SuiteApps are designed to perform specific financial operations and payment processes according to local requirements.

NetSuite also allows them to ensure that your data is accessible and compatible across the group. You should also consider replicating the parent company’s processes for better compatibility and more efficient reporting.

2. Select the right accounting partner

Your CFO’s accounting partner will be crucial in managing local operations and ensuring continuity as the company grows. Key questions to ask include whether they can operate within your chosen software and processes, scale with your business, and how dependent the service is on individuals. Working with a global accounting service partner that can grow with you can help avoid risks and ensure continuity. With Staria you are free to tailor the service model and allocation of responsibilities to your needs – and adjust them as your needs evolve. For example, perhaps you wish to handle group-level accounting yourself and only outsource subsidiaries. Or you might want to handle some of the subsidiaries yourself and outsource the others. Maybe you’d like to only outsource AP and AR (see point 5), monthly closing, and regulatory reporting – or payroll. It’s your choice.

3. Ensure access to key SaaS metrics

Metrics like recurring revenue, churn, and forecasted cash flow are critical for SaaS CFOs but are not readily available from all billing tools. Ensuring these metrics are seamlessly integrated into your company’s financial systems is paramount. Billing software that enables real-time access to these KPIs and minimizes the risk of human error in manual reporting is recommended.

If you are a private equity owner, ensuring these metrics are seamlessly integrated into your company’s financial systems is paramount. These numbers are not just operational—they are key drivers of valuation, investment decisions, and portfolio performance monitoring. A robust metric-reporting system helps avoid delays and inconsistencies during quarterly reviews, capital raises, or exits.

4. Establish trustworthy and unified reporting

One of the most common issues in multi-entity setups is unreliable or fragmented reporting. Setting clear reporting guidelines and standard operating procedures for subsidiaries, and implementing unified systems where possible, can help avoid issues in reporting. If unified systems aren’t feasible, you could consider a centralized reporting and planning tool, like our own solution, which includes a built-in data warehouse and tools to unify data from different sources.

5. Address billing, payments, and revenue recognition early

In SaaS business, billing complexity grows fast, especially with transaction- and volume-based pricing. Investing early in ERP systems with built-in capabilities for automated billing, revenue recognition, and integration with payment platforms can prevent the need for multiple, disconnected tools and save time, money, and frustration.

6. Get expert support on tax and compliance

Even the best-laid expansion plans come with surprises, especially regarding regulation and compliance. Many CFOs benefit from a partner who’s navigated global expansion before. Consultation on the right technologies and compliance support can help make smart, confident decisions that will make market expansion smoother.

Whether your next investment is in one of the 50+ markets we’ve already supported or in an emerging high-growth region, Staria is ready to help you chart the course.

From consultation on the right technologies to compliance support, we’ll help you make smart, confident decisions that will make your market expansion smoother.

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