If you listen to any start-up pitches, you hear about the $XX BILLION DOLLAR global market. When we were in an accelerator program, we were advised to “use global numbers to make your market look bigger”.
There is just one problem there.
Nearly all of those start-ups throwing out figures for “the global market” know exactly nothing about doing business outside their own country
Although there may be 1 billion Chinese who want to learn English, the only person in our network who knows any Chinese words is my granddaughter who learned a couple on some kids’ show. Don’t even get me started on the difficulty of conducting business in your second language and NOT everyone speaks English in China or Europe or Japan or … I don’t care what experience you had on that tour you went on with the English-speaking guide and the English-speaking hotel staff. Remember, they were taking your money, not giving you theirs.
Then there is the whole issue of actually doing business. There are a million differences that can trip you up.
How often do you pay payroll taxes?
In the US, it’s quarterly. In Chile, it’s monthly, a fact I learned from my accountant just a few days before I would have gotten fined for not paying them.
Who paid their taxes on time? Me, that’s who
How do you activate your RUT (like your social security number) so you can pay taxes?
If you’re American, you never had to do anything to notify the IRS you were doing something requiring paying taxes. You send in a 1040 or other form with your Social Security number on it. Nope, in Chile you need to go to the SII office (like the IRS), whether you are an individual or a corporation and officially initiate activities.
What’s your market like in other countries?
Take 7 Generation Games, for example. We make educational software (marketed as Strong Mind Studios in Latin America). In the U.S., private schools are about 10% of the market. In Chile, most students attend private schools, the vast majority of which are subsidized private schools, kind of like charter schools in the U.S. except that the parents pay some tuition.
Recently, Maria (our CEO), was speaking to someone from a country with a national curriculum. She said we don’t have that in the U.S. He said, “No problem, I will just sell to each of the 50 state educational agencies.” He was quite shocked when she told him there were way over 10,000 school districts in the U.S.
Do you have any connections at all in other countries?
It’s not easy getting sales or investment in your home country where you have family, friends, old classmates, colleagues and former clients to recommend you. How much harder do you think it is going to be in a country where you don’t know anyone, particularly if you don’t speak the language? That was a rhetorical question. The answer is – a lot.
The greatest advantage to our company of being part of Startup Chile is that we really are gaining international experience and connections. It’s no coincidence that we have received significantly more investment since moving to Chile. It’s evident that when we throw out those numbers for the global market we’re not just talking the talk.
Speaking of which, I’m heading out to give a talk to Chilean educators at the U.S. Embassy. Wish me luck!
Want to improve your Spanish, learn history and brush up on math all at the same time?
Take your pick:
AzTech: Meet the Maya – Mayan history and statistics, in Spanish and English