What Global Scaling Really Costs

A new benchmarking report exposes the often-overlooked costs and risks businesses face when scaling internationally across 19 markets.

Native Teams has launched its Global Expansion Report, the first cross-market benchmark to quantify the real cost, complexity and risk of scaling internationally. Drawing on data from more than 3,000 globally active companies and verified insights from 17 independent legal, accounting and compliance firms, the report analyses timelines, regulatory exposure and levels of digitalisation across 19 jurisdictions — offering a clear-eyed view of what global expansion actually involves in the era of remote work. The study was conducted during Web Summit Lisbon and in partnership with Swiss Entrepreneurship Program (Swiss EP), Startup Club Skopje, Fil Rouge Capital, Eleven VC, and MFG Invest.

The study analyses 19 markets across Europe, Asia, North America and Oceania, with Europe accounting for 79% of the markets reviewed, followed by Asia (11%), the United States (5%) and Australia (5%). Drawing on insights from more than 100 founders, executives and HR leaders operating across SaaS, AI, cybersecurity, fintech, digital infrastructure and professional services, as well as sustainability and venture capital, respondents shared first-hand experiences on hiring models, priority regions and common mistakes businesses make when scaling internationally.

The research shows that Europe – particularly the UK, Portugal, Spain and the DACH region – alongside North America, remains the primary focus for expansion over the next 12 to 24 months. APAC, Latin America, the Middle East and Africa are more commonly viewed as secondary markets, typically pursued once product-market fit is secured and funding is in place.

Simeon Iliev, Chief Opportunity Navigator at MFG Invest, said investor priorities are shifting beyond geography alone. “We see a clear trend: Central Eastern Europe and LATAM offer world-class talent without world-class burn,” he said. “These high-performance regions remain underestimated, yet they enable early-stage companies to scale efficiently. What matters most to us as investors are signs that leadership teams can operate in a distributed way, with clear communication, documented processes and strong ownership.”

Digital Leaders Pull Ahead as Manual Processes Persist
Despite the global shift towards digital-first business models, the report finds that company incorporation remains heavily manual in many jurisdictions. Across the 19 markets analysed, the average incorporation complexity score stands at 2.9 out of 5, reflecting the continued reliance on paperwork, in-person verification and legacy procedures.

The UK, Ireland and Estonia rank among the easiest markets for company formation, each scoring 1 due to fully digital, low-friction registration systems. Australia, Hong Kong, Malta, Cyprus and the United States perform moderately well, with a score of 2. In contrast, Germany, Belgium, Spain, France, Croatia and Austria score 4, while the Philippines ranks as the most complex market with a score of 5. These barriers can delay expansion significantly, with companies often waiting weeks or months before they are legally able to hire employees or operate in new markets.

When Flexible Hiring Stops Being the Cheapest Option
The report also highlights a turning point in global hiring strategies as companies scale. While Employer of Record (EOR), contractor and hybrid models remain the fastest route into new markets, their cost efficiency diminishes over time. Jack Thorogood, CEO and Founder of Native Teams, said the data points to a clear inflection point. “When a business reaches roughly four to ten employees per market, the annual cost of EOR begins to mirror, or even surpass, the investment required to establish and maintain a local entity,” he said. “At that stage, owning infrastructure delivers stronger cost predictability and greater control over compliance, payroll and long-term growth.”

Banking and Notarisation Remain Major Bottlenecks
Across most jurisdictions, the incorporation process follows a similar sequence, but the complexity and duration vary widely. Founders identified mandatory notarisation, share capital deposits, bank reference letters, source-of-funds verification and engagement letters as the most significant procedural barriers. Opening a local or digital bank account consistently emerged as the most time-consuming step, often driving up both incorporation timelines and costs and delaying market entry.

The True Cost of Going Global
According to the report, setting up a legal entity across the 19 reviewed markets costs an average of €7,300 and takes between 15 and 23 business days. Ongoing maintenance adds a further €7,700 per year, bringing the average annual cost of operating a single entity to approximately €15,000.

Beyond direct costs, businesses must also manage legal filings, payroll systems, tax registrations and ongoing compliance obligations, increasing operational complexity compared with alternative hiring models such as EOR. The findings underline a growing need for businesses to weigh speed, control and cost more carefully as they scale across borders — particularly as remote work continues to reshape global expansion strategies.

To find out all market insights and statistics, download the full report here.