Europe's economic decline is a topic of concern, but recent data shows that U.S. software companies heavily rely on the old continent for their future success. European revenue plays a crucial role in the growth and profitability of these companies. Rubrik, for example, reported that 25% of its revenues came from Europe in 2023 and 2024. Klavyio and Freshworks also depend on European markets, with 20% and 42% of their revenue coming from Europe, respectively. The top 50 private companies by valuation have expanded into Europe, recognizing the market's potential for market share and revenue growth [167313f8].
European markets are particularly important for IPO-ready companies. Overlooking Europe weakens enterprise value and reduces attractiveness to public market investors. European revenue represents a significant portion of software spend, accounting for 27% of the total. Additionally, Europe has a GDP of over $20 trillion, making it a lucrative market for software companies. CEOs of growth-stage startups should prioritize European expansion to tap into this revenue potential and secure a strong market position [167313f8].