3 strategies for international expansion: how a startup can enter a new market

Nada Shahin, founder and managing director of GB Ventures, the venture capital arm of GB Corp — one of Egypt’s largest industrial groups, LinkedIn

Entering international markets is one of the most critical inflection points in the development of any startup. It can serve as a catalyst for exponential growth or as a decision that leads a company to collapse. As an investor who backed Egypt’s first FinTech unicorn and has observed companies expanding into African, Gulf, and Central Asian markets, I have formed a clear understanding of what distinguishes successful expansions from failed ones.

The first thing I strive to understand is whether the founding team has done the necessary work to research the new market. This goes beyond a superficial presentation with TAM figures pulled from some research report; it requires a deep understanding of customer behavior, cultural nuances, purchasing power, and the competitive landscape at the specific market level. A product that works successfully in Cairo or Riyadh does not necessarily perform equally well in Nairobi, Tashkent, or Istanbul. Mechanisms for building consumer trust vary. Payment habits differ as well. Even the understanding of which needs remain unmet can vary significantly from one market to another. Founders who skip this stage risk spending a significant portion of their capital on what could have been learned in just a few weeks of local research.

The second criterion is the regulatory environment and the actual licensing requirements. In some countries, clear operating rules have already been established for FinTech companies, logistics, and mobility services. In others, particularly in the financial sector, specialized industry licenses, approvals from the central bank, or specific local ownership structures may be required — and navigating all these procedures can take anywhere from 18 to 36 months. I pay close attention to how realistically the team estimates the timeline, cost, and operational burden associated with complying with regulatory requirements. The regulatory environment is not just a checkbox item. It directly impacts unit economics, hiring strategy, and the speed of revenue generation. Many startups seriously underestimate this factor, and the price of such an error can be very high.

The third, and perhaps most complex question, is the market entry strategy itself. Universal expansion advice does not work here. There is no single scenario for everyone. The optimal entry method depends on the combination of the business model, the maturity level of the target market, and the assets that can be acquired or leveraged through partnerships.

I see three main paths.

The first is to acquire a local player. This is the fastest way to simultaneously gain market knowledge, an existing customer base, and the necessary regulatory approvals.

The second is to enter into a strategic partnership with a local operator. This option requires less capital but offers less control over the business.

The third is to build the business from scratch by relocating executives to the new market and forming a local team. This option offers the highest level of control but is simultaneously the most expensive and time-consuming. It only makes sense if there is no suitable asset available for acquisition in the market.

Every company and every market requires its own scenario. The most successful expansion examples I have observed were executed by teams that first took the time to research the market and, upon entering it, had sufficient confidence to focus entirely on its development.

A good example of successful expansion through acquisition is MNT-Halan, Egypt’s first FinTech unicorn and a company in our GB Ventures portfolio. In 2024, instead of obtaining a Turkish lending license and building the business from scratch, MNT-Halan acquired Tam Finans — Turkey’s leading non-bank financial institution — from Actera Group and the European Bank for Reconstruction and Development (EBRD).

Through a single transaction, the company obtained a loan portfolio valued at over $300 million, credit scoring models adapted for Turkish borrowers, an existing distribution network covering small and medium-sized businesses nationwide, and, crucially, the necessary license and a local management team. Today, Turkey accounts for approximately 40% of MNT-Halan’s revenue.

This is what a well-executed acquisition-based expansion looks like: you are not just buying a license — you are buying a decade of market knowledge that comes with the company.

Ultimately, as an investor, I evaluate not only the presence of a market opportunity but also whether this specific team is capable of leveraging it. For me, the key positive signals are quite simple: the founder has personally spent time in the target market, the expansion is driven by real market demand rather than internal pressure on the team to grow, and the regulatory path, hiring plan, and capital needs have been meticulously calculated before the first dollar is invested.

Expansion is not just a growth strategy; it is a strategy for multiple scaling. If the business model does not work in the home market, problems will manifest even faster in a new market. But if the business foundation is solid and the team understands and respects the specifics of the new market, expansion can significantly amplify all of the company’s strengths.