Going Global

by Mike Brown

In case you were not paying attention in grade school or reading today's newspapers, the population of the United States accounts for only 5 percent of the people on this planet. Further, the markets of China and India, which are about the same size as each other, account for over one-third of the world’s population.

So you only sell to 5 percent of the world’s markets? Well my sons and daughters, get a passport and go west, go east, go south or maybe even north. It is a brave new world out there!

Even if those markets might not even be served by your products, could your products be served by those markets’ human capital, resources or ideas?

My company started 12 years ago in Budapest, Hungary, shortly after the Russians headed home. Now we sell to Russians, Central and Western Europeans as well as Indians and Chinese. I have learned a few lessons along the way, some more costly than others, and some more profitable than others. Right now 95 percent of our revenues and profits come from outside the U.S.

Here are a few lessons to share:

 

Rule of Law

Choose your country carefully—is there a good rule of law? Can you protect your business? Can you repatriate your hard earned profits?

 

Passport

There is no way to do any decent business in a new country without traveling there a number of times first. As I said before, get your passport and travel there; set up meetings with the American Chamber of Commerce and the Big 4 accounting firms’ customers in that country.

 

Communication

Speaking English louder does not mean you are communicating any better. Remember, you are a guest in this new host country.

 

Local Partners

Choose local partners carefully—most of those you run across are not long-term, trusted locals. In smaller countries, all these guys claim to know your target CEO contacts well. Remember, knowing someone in this little foreign pond does not in any way mean that your local partner has any influence on that particular individual and/or is trusted by him. Check other foreign companies in that country for a reference.

 

Connections

When meeting all associates with your new foreign business, set the honesty ground rules early. If your “connected” partner tells you that you need to slip him bags of money so he can “facilitate” with bribes—leave the meeting. Run, don’t walk away. Blackmail never ends and the U.S. Foreign Corrupt Practices Act will put you behind bars for bribing government employees in foreign countries. And, last I heard, these bribes that put you behind bars are tax-deductible in many Western European countries, un-leveling the playing field and making it necessary for you to be smarter, faster and more creative.

 

Commitment

Be patient—both to construct the right deal and then follow-on deals. Patience also implies financial staying power. Starting a business anywhere is difficult and usually takes much more time and more money than anticipated. Overseas—double that!

 

Family and Yourself

International business is not easy. It’s a long way away. Check with your spouse and kids while being honest with yourself and with them that you are going to be gone for more than the U.S. overnight stays. Learn to sleep on an airplane.

 

Have Fun

The end of your life’s adventure is known—YOU DIE! Enjoy the adventure prior to that day. Believe me, international business can certainly be an adventure.

Mike Brown is chairman and CEO of Euronet Worldwide, Inc. He can be reached by email at mbrown@eeft.com.