From Underperforming Subsidiary to $150M Exit in Two Years
Rebuilding the leadership team of an underperforming North American subsidiary as the foundation for strong growth and a successful exit — within two years.
The leadership team was rebuilt within four months.
Over the following two years, the North American subsidiary grew from under $500,000 in revenue to approximately $150 million in annual revenue — and was subsequently acquired by an international engineering and construction group.
At a Glance
Client
European developer of renewable energy infrastructure projects
Starting Point
North American subsidiary with less than $500,000 in revenue after more than one year of operations
Mandate
Independent assessment of existing leadership structure; retained executive search for new leadership team
Solution
Recruitment of a new CEO and transition of a five-person leadership team with established market relationships
Outcome
Revenue growth to $130–150M within two years; subsequent acquisition by an international engineering and construction group
Company Background
A European developer of renewable energy infrastructure projects had grown from an entrepreneurially driven startup into an internationally active project developer with operations across multiple continents.
As part of its international growth strategy, the company established a North American subsidiary to participate in one of the most dynamic infrastructure markets in the world.
The new organization was intended to become an important pillar of the group’s long-term growth strategy.
The first operational results, however, fell significantly short of the European parent’s expectations.
The Real Problem
The core issue was not market demand — it was the fit of the leadership structure.
Despite favorable underlying market conditions, the North American subsidiary failed to gain operational momentum. More than a year after market entry, revenue stood at less than $500,000 — well below the European parent’s expectations.
At the same time, the overall market continued to develop strongly. For the shareholders, this raised a fundamental question:
Was the problem with the market entry strategy - or with the composition of the leadership team?
Answering this question required an objective assessment of the organization and its leadership structure. The shareholders decided to commission an independent external analysis to create a sound basis for any leadership decisions that might follow.
A Two-Phase Mandate
TH Bender was initially retained to conduct an independent assessment of the North American subsidiary and its leadership team.
The objective of this first mandate was to evaluate whether the existing leadership structure possessed the capabilities required to successfully build the business in the North American market.
The assessment focused on three areas:
- Roles and responsibilities within the leadership team
- Experience and market knowledge of the executives in place
- Alignment between management capabilities and the operational requirements of the local market
Upon completion of the assessment, the shareholders concluded that the subsidiary’s challenges were primarily organizational in nature. The analysis made clear that a fundamental leadership change was necessary.
TH Bender was subsequently retained for an executive search mandate to place a new CEO and rebuild the leadership team of the North American subsidiary.
What the Analysis Showed
The management assessment identified several structural capability gaps within the existing leadership team.
The analysis confirmed that the challenges facing the North American subsidiary were organizational in nature — not a reflection of insufficient market demand. The underlying market opportunity remained attractive. However, the existing leadership team lacked several capabilities that were essential for successfully building the business in the local market.
Die zugrunde liegende Marktchance blieb weiterhin attraktiv. Allerdings verfügte das bestehende Führungsteam nicht über mehrere Kompetenzen, die für den erfolgreichen Aufbau des Geschäfts im lokalen Markt erforderlich waren.
Three core areas required action:
Limited Regional Market Experience
Several members of the leadership team had international experience but limited operational exposure to the North American market environment.
Limited Industry Relationships
Commercial success in this sector depended heavily on established relationships with contractors, customers, and other industry participants. The existing team had only limited access to these networks.
Insufficient Fit for the Build-Out Phase
The role profiles and experience of the leadership team did not fully match the demands of a fast-growing project business in the North American market.
The analysis led to a clear conclusion:
The subsidiary needed a new leadership structure to quickly establish credibility and operational momentum in the market.
An Unexpected Opportunity
In the course of the executive search process, an opportunity emerged to bring an experienced leadership team across from the market.
While searching for a new Chief Executive Officer, TH Bender identified an experienced executive at a competitor with deep experience in the North American market.
Confidential conversations revealed a distinctive strategic situation: the international owner of this competitor had decided not to support further North American expansion with additional capital and was considering a withdrawal from the market. This created an exceptional opportunity to rebuild the North American organization for TH Bender's client.
The executive in question had already built an experienced leadership team with established market relationships and broad operational expertise.
Rather than filling individual positions, the structured executive search process opened the possibility of bringing in a cohesive, experienced team already capable of quickly rebuilding the organization and establishing market credibility.
Trust as a Prerequisite
Realizing this solution required a high degree of trust between the shareholders and the prospective new leadership team.
Executing this strategic option went well beyond a conventional executive search process. For the competitor’s leadership team, moving to a different organization represented a significant professional risk. Making that move required clarity on the new shareholder’s long-term strategy, the financial backing for the business, and the prospect of building a sustainable organization in North America.
At the same time, the European shareholders faced a demanding decision of their own. Rebuilding the organization meant replacing the existing leadership team and writing off a portion of the prior investment in the original structure.
This situation required a high degree of trust — in the new leadership team and in the process that would guide the transition. TH Bender assumed the role of a neutral intermediary between the parties. Over several months, a confidential communication process developed between the shareholders and the prospective leadership team.
This structured dialogue created the transparency and trust needed to ultimately enable the coordinated transition of the new leadership team.
Tactical implementation
The existing leadership structure was replaced by an experienced, cohesive management team.
Once the shareholders and the new leadership team had aligned on the future direction of the North American subsidiary, TH Bender was retained to execute the leadership transition as part of the executive search mandate. The first step was the recruitment of the new Chief Executive Officer — an executive with extensive North American market experience and an established industry network
Several experienced industry specialists subsequently joined the organization in key leadership roles. The team brought complementary capabilities across project development, operational execution, and commercial management.
A significant advantage was that several members of the team had worked together previously and already had active relationships with customers, contractors, and other market participants.
This enabled the North American subsidiary to quickly assemble a high-performing leadership team, develop operational momentum, and significantly strengthen its market position in a short period of time.
Outcome
Within two years, the North American subsidiary grew into a business generating approximately $150M in annual revenue.
The impact of the leadership change was rapid. Within two years, the subsidiary grew from under $500,000 in revenue to approximately $130–150 million in annual revenue. In parallel, the new leadership team built a project pipeline of approximately $175 million — a solid foundation for continued growth.
The organization expanded into multiple regional markets across the United States and established itself as a credible and competitive market participant.
The successful turnaround of the North American subsidiary ultimately produced a strategic outcome: the company was acquired by an international engineering and construction group. The North American organization went on to become one of the most successful units within the group.
What This Case Study Shows
Many European companies entering North America assume that experienced leaders from other regions can be transferred into the U.S. market without significant adjustment.
In practice, success in the North American market frequently depends on deeply local factors — regulatory experience, established industry relationships, and long-standing connections with customers, contractors, and project partners.
This case study illustrates several lessons that are frequently relevant when building operations in North America:
Local Market Credibility Is Non-Negotiable
In relationship-driven industries, executives must have credible regional networks and a deep understanding of the regulatory and commercial landscape.
Leadership Challenges Are Often Structural
When subsidiaries underperform, the root cause is often not the market strategy — it is a mismatch between the leadership structure and what the local market actually requires.
Assessment Before Action
Replacing individual executives rarely resolves structural challenges sustainably. An independent assessment of the leadership structure provides a sound basis for consequential decisions.
Complex Leadership Transitions Require a Neutral Intermediary
When leadership transitions involve multiple stakeholders — competitors, investors, and international shareholders — a trusted intermediary is essential to maintain confidentiality while enabling structured alignment across all parties.
Client Perspective
“TH Bender built practically the entire second generation of our leadership team in North America. Our project pipeline grew from virtually zero to nearly $200 million. Today, our U.S. business is the most profitable unit in the entire group.”
Vorstandsmitglied-Chief Strategy Officer-
Board Member - Chief Strategy Officer, European Corporate Group
Frequently Asked Questions
Answers to common questions about Executive Search, Interim Leadership, and the appointment of senior leadership roles in the United States, Canada, and Mexico.
Why do many divisions, units and subsidiaries struggle in the early phase?
Companies expanding into new markets often assume that a strong leadership track record will transfer directly — that proven executives can build a new organization and hit the ground running.
In practice, success in a division or subsidiary frequently depends on factors that are deeply local — established industry relationships, regulatory familiarity, and a nuanced understanding of regional market dynamics.
In this case, the management assessment revealed that the issue was not market demand. The real problem was a mismatch between the leadership team's capabilities and what the regional market actually required.
Why is a management assessment often conducted before an executive search?
Before launching a CEO search, shareholders frequently want an independent evaluation of the existing leadership structure.
A structured management assessment determines whether the challenges at hand are strategic, operational, or organizational in nature.
On that basis, shareholders can decide whether targeted adjustments are sufficient — or whether a broader restructuring of the leadership team is required.
Why is the entire leadership team sometimes replaced at a U.S. subsidiary?
The assessment made clear that building the business successfully required a leadership team with deep industry relationships and hands-on experience in the North American market.
Rather than replacing individual positions, the shareholders opted for a full structural rebuild of the leadership team — to establish market credibility and operational momentum quickly.
How long does an executive search process take for a U.S. subsidiary?
In this case, the leadership rebuild moved quickly. From the start of the North American executive search mandate to the installation of the new leadership team took approximately four months.
Within two years, the North American subsidiary grew from under $500,000 in revenue to a business generating roughly $130–150 million in annual sales.
When should companies consider an executive search or management assessment for a U.S. subsidiary?
A management assessment is worth considering when a North American subsidiary is underperforming relative to expectations — despite favorable market conditions.
In many cases, the root cause is not the market strategy. It is a mismatch between the leadership structure and what the market actually demands.
An independent assessment gives shareholders a solid basis for deciding whether adjustments within the existing team are sufficient, or whether an executive search mandate is the right next step.
How are fees structured for an Executive Search engagement with TH Bender?
We work with a transparent, mandate-based fee structure that reflects the level of responsibility associated with the position and the scope of the search engagement.
The exact structure is discussed individually in a personal conversation.
Learn more about our Executive Search fee model.
Fee structures for interim leadership mandates and board advisory engagements are explained on the respective service pages.
When a subsidiary in the North American market falls short of expectations, the root cause is often not market potential — it is the fit between the leadership structure and the local market environment.
A confidential conversation can help clarify whether an independent management assessment or an executive search mandate is the right foundation for sustainable growth.
Or email us at info@thbender.com
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