Timing is probably one of the most complicated parameters for a US expansion, as I stated in my previous article about “Why do startups fail in the US?”

If you come too soon, you might burn your cash before finding your product market-fit. If you come too late, competition will be too fierce for you to get a chance to compete.

So how do you know when the right time has come?

Too Soon

Over the last years, I met a few entrepreneurs that decided to start their business directly in the US mainly because their first investors where there. They relocated their company in Silicon Valley with their family and started hiring their developers in the US. And that is when they started feeling the pain. In San Francisco, the average rent is US3,680 for 69 m2, while you might need to pay an additional $1,955 per month to place your 4-year old in a daycare. If you want to hire for instance a python developer, the median salary is USD113,000 according to salary.com and the person might leave you without notice for a better paying job.

In a nutshell, the required investment in the US to launch a product is at least twice as big especially in a tech hub like Boston, New York or San Francisco. So, you absolutely need to find your product market fit quickly enough to cover your expenses or to be able to raise funding on a highly competitive market.

Too late

Obviously, the best would be to wait until you already have solid revenues, a well-functioning customer success and enough cash to fund your international development.

But while you build all the required assets, local competitors might raise hundreds of millions and cover the market with expensive marketing campaigns. Even with a better product, it will be hardly possible for you to penetrate the market.

So how do I know that this is the right moment?

You need to look at the market dynamics:

1- Are you on a growing market?

This sounds obvious, but it remains easier to enter a growing market in which your customers are getting equipped for the first time. Most importantly, if the US market seems to be growing much faster than the European one, then you might have to launch there as fast as possible. Waiting too long will mean that by the time you get one customer in France, your competitor will get 20.

2-Are the customers looking for a solution in the near-term? (or how educated are they on your market)

Here you want to go past the “hype curve” of Gartner. The idea is to check whether your potential customers are actively looking for information and solution on the problem you are solving. The best way to do that is to ask key opinion leaders, analysts and obviously potential customers if they would be ready to buy your solution in the next quarter.

3-Are there many small competitors?

Try to position yourself in a category of solution where there are other small competitors. Being in a category will accelerate your sales as customers will understand faster what type of services your provide.

Entering a fragmented market is often the best-case scenario as it means:

• There is a market; otherwise there would not be many companies trying to tap into it
• No competitor has emerged as a leader, so there is still room for new entrants

Now the big question is: how do you assess the market dynamics?

That is the whole point of defining your product-market fit:

• Talking to potential customers and key opinion leaders
• Mapping your market and analyzing your competition
• Assessing your Unique Selling Point (USP) with clarity

Feel free to contact us if you want to know more or if you need our help!