How to do business in Colombia?
December 19, 2014 7:16 PM Subscribe
How do Colombian think? The do's and dont's of doing business in Colombia.
Background:
I have some proprietary knowledge that can make companies a lot of money (let's say chemical industry). I am very close to a deal in Asia. I understand the mentality there very well. I tried to do Business in Russia too but results have been disappointing so far, even before the collapse of their currency. They have a way of being paranoid in their thinking. (Please understand that this is not meant judgmental, it is based on their history and may have them served well).
Now I found a company in Colombia. I never heard of it before and I know they should be tremendously interested in what I have to offer. The only way that they would walk away from my proposal would be if they are too stupid to understand what I am offering them. Also, Colombia has a free trade agreement with the USA, we could serve the US market. This makes this so interesting.
I have been to Colombia, I like Colombia, I don't speak Spanish (but Portuguese). Likely the company will be able to communicate with me in English but a language barrier is always a huge problem, besides trust. I don't want to "burn" this opportunity. I Russia I basically did "cold calling" and I think this was a very bad idea. In Asia I had someone open a door for me.
My Questions:
1. How do Colombians think? Are they paranoid? Do they have an inferior complex when doing business with a "gringo"? I want to understand their way of thinking.
2. How should I approach them? How important is it to have someone make the contact for me or could I just email them? I have not emailed them in the last 2 months because I really want to have the right start.
3. I don't know the financials of this company. Likely they won't be able to pay me and my partners what we are asking for. That is fine. This time we actually would prefer to be paid in equity. This is a tremendous opportunity for both sides due to the free trade agreement with the US. How likely is it that a Colombian company would be willing to do such a deal? How open are they to partners? (Chinese companies dislike such things).
I am sure there are Colombians on Metafiler and I would appreciate any help/suggestions/advice.
Background:
I have some proprietary knowledge that can make companies a lot of money (let's say chemical industry). I am very close to a deal in Asia. I understand the mentality there very well. I tried to do Business in Russia too but results have been disappointing so far, even before the collapse of their currency. They have a way of being paranoid in their thinking. (Please understand that this is not meant judgmental, it is based on their history and may have them served well).
Now I found a company in Colombia. I never heard of it before and I know they should be tremendously interested in what I have to offer. The only way that they would walk away from my proposal would be if they are too stupid to understand what I am offering them. Also, Colombia has a free trade agreement with the USA, we could serve the US market. This makes this so interesting.
I have been to Colombia, I like Colombia, I don't speak Spanish (but Portuguese). Likely the company will be able to communicate with me in English but a language barrier is always a huge problem, besides trust. I don't want to "burn" this opportunity. I Russia I basically did "cold calling" and I think this was a very bad idea. In Asia I had someone open a door for me.
My Questions:
1. How do Colombians think? Are they paranoid? Do they have an inferior complex when doing business with a "gringo"? I want to understand their way of thinking.
2. How should I approach them? How important is it to have someone make the contact for me or could I just email them? I have not emailed them in the last 2 months because I really want to have the right start.
3. I don't know the financials of this company. Likely they won't be able to pay me and my partners what we are asking for. That is fine. This time we actually would prefer to be paid in equity. This is a tremendous opportunity for both sides due to the free trade agreement with the US. How likely is it that a Colombian company would be willing to do such a deal? How open are they to partners? (Chinese companies dislike such things).
I am sure there are Colombians on Metafiler and I would appreciate any help/suggestions/advice.
How do Colombians think? Are they paranoid? Do they have an inferior complex when doing business with a "gringo"? I want to understand their way of thinking.
Practical guides and careful observations of typical cultural interactions notwithstanding, anthropologists have tried out and generally discarded what are known as national character studies that make statements about personality. See for example A Companion to Psychological Anthropology (2007), "There were other studies of national character as well, but this kind of approach increasingly came under fire from many quarters for its political prejudice and lack of objectivity, as well as its assumption that there was a causal relationship between culture and personality." See also this paper from 2005: "Perceptions of national character thus appear to be unfounded stereotypes that may serve the function of maintaining a national identity."
I work with a remote team in Colombia on a daily basis, and I suspect answers you look for in this domain could actually mislead you worse than the simple assumption of economic rationality, although I can well understand looking for practical info on arranging business meetings and things like, you know, common topics of conversation (e.g. soccer or beer or whatnot).
posted by Monsieur Caution at 10:25 PM on December 19, 2014 [3 favorites]
Practical guides and careful observations of typical cultural interactions notwithstanding, anthropologists have tried out and generally discarded what are known as national character studies that make statements about personality. See for example A Companion to Psychological Anthropology (2007), "There were other studies of national character as well, but this kind of approach increasingly came under fire from many quarters for its political prejudice and lack of objectivity, as well as its assumption that there was a causal relationship between culture and personality." See also this paper from 2005: "Perceptions of national character thus appear to be unfounded stereotypes that may serve the function of maintaining a national identity."
I work with a remote team in Colombia on a daily basis, and I suspect answers you look for in this domain could actually mislead you worse than the simple assumption of economic rationality, although I can well understand looking for practical info on arranging business meetings and things like, you know, common topics of conversation (e.g. soccer or beer or whatnot).
posted by Monsieur Caution at 10:25 PM on December 19, 2014 [3 favorites]
Mod note: A couple of comments deleted. Best to just stick with answering the question here, and if you want to have back and forth general discussion or debate, consider email. OP, not all answers will be what you are looking for; that's okay, you can just pick and choose those that seem most helpful for your purposes.
posted by taz (staff) at 1:09 AM on December 20, 2014
posted by taz (staff) at 1:09 AM on December 20, 2014
As a person who was based in Miami and did business with folks all over Latin America, here are some generalizations that will serve you well.
1. It's about the personal relationship. Get to know your prospects, ask about families. I'd often stop by the office (after confirming that they weren't busy) just for coffee and chit-chat. They employed a lady simply to make coffee and hand out little biscuits.
2. This will not be a fast negotiation. YOU will need to be vetted. Don't rush anyone, or give ultimatums. The deal will happen in good time and not before.
3. If the answer is no, chances are it won't be communicated to you directly. Once you've made the connection and they like you, it will be very hard for them to disappoint you. If you find that there's a lot of dancing around or a reluctance to set appointments with you, that's your no.
4. Know some Spanish, and have a person who is fluent in Spanish as a member of your team. While nearly everyone can do business in English, and will do, the side conversations in Spanish are well worth understanding. There are also subtleties of language that can only be communicated in Spanish. My Spanish is very industry specific and my conversational Spanish is smile provoking. I am told that I have a Cuban accent, so that's kind of funny. Most of my customers enjoyed speaking Spanish with me and helping me learn the language, syntax and vocabulary. My partner would do the heavy lifting and help me keep the flow going during conversation. Spanglish is a thing.
5. The idea that people of a Latin American nation would feel inferior to someone from the US or Europe is offensive, so you might not want to have the attitude that you are going to school the third world. That, most assuredly will NOT go over well.
6. If you know someone who can introduce you, that's great, but it's business, so if you don't know a guy who knows a guy, CALL down there and speak to someone, better yet, make an appointment and visit in person. Have someone who's fluent in Spanish call to make the appointment. If you can arrange it, take your prospects out for lunch or drinks, get to know them both in a business setting and an informal setting.
Good luck to you.
posted by Ruthless Bunny at 4:43 AM on December 20, 2014 [5 favorites]
1. It's about the personal relationship. Get to know your prospects, ask about families. I'd often stop by the office (after confirming that they weren't busy) just for coffee and chit-chat. They employed a lady simply to make coffee and hand out little biscuits.
2. This will not be a fast negotiation. YOU will need to be vetted. Don't rush anyone, or give ultimatums. The deal will happen in good time and not before.
3. If the answer is no, chances are it won't be communicated to you directly. Once you've made the connection and they like you, it will be very hard for them to disappoint you. If you find that there's a lot of dancing around or a reluctance to set appointments with you, that's your no.
4. Know some Spanish, and have a person who is fluent in Spanish as a member of your team. While nearly everyone can do business in English, and will do, the side conversations in Spanish are well worth understanding. There are also subtleties of language that can only be communicated in Spanish. My Spanish is very industry specific and my conversational Spanish is smile provoking. I am told that I have a Cuban accent, so that's kind of funny. Most of my customers enjoyed speaking Spanish with me and helping me learn the language, syntax and vocabulary. My partner would do the heavy lifting and help me keep the flow going during conversation. Spanglish is a thing.
5. The idea that people of a Latin American nation would feel inferior to someone from the US or Europe is offensive, so you might not want to have the attitude that you are going to school the third world. That, most assuredly will NOT go over well.
6. If you know someone who can introduce you, that's great, but it's business, so if you don't know a guy who knows a guy, CALL down there and speak to someone, better yet, make an appointment and visit in person. Have someone who's fluent in Spanish call to make the appointment. If you can arrange it, take your prospects out for lunch or drinks, get to know them both in a business setting and an informal setting.
Good luck to you.
posted by Ruthless Bunny at 4:43 AM on December 20, 2014 [5 favorites]
A few thoughts, all trying to avoid any over-generalization.
First, it's very unlikely a Colombian business person in a consequential position will have any sense of inferiority or lack of sophistication that could lead to paranoia. Many are from families that have been in the elite for centuries and in their present business for decades or longer; the rest are self-made strivers with ferocious self-confidence.
Second, your aspiration to be paid in equity is problematic. Family ownership, or at least control, of business is the default there. Many partners wouldn't consider paying you in equity; many others would be sure to have their lawyers only give you equity with significant limitations. Finally, the opportunity eventually to monetize your equity is going to be limited.
Third, of course you need introductions. A Colombian with sufficient capacity to engage in cross-border business is not likely to consider any cold calls, to say the least of cold emails, as a likely source for a business partner. But this is not a challenge, really -- between your lawyers and your bankers, you should be one phone call away from a well-connected Colombian in Miami or Madrid who can connect you onward to whoever you could possibly need to make specific introductions.
Fourth, I hope I am misreading you, but I suspect that the business model you have in mind may not work -- Free Trade Agreements and their implementing regulations have elaborate precautions around trans-shipment, which means that a Colombian enterprise is not going to be able freely sell to the US goods or services with a large component of value that they have originally imported from you.
posted by MattD at 5:02 AM on December 20, 2014 [2 favorites]
First, it's very unlikely a Colombian business person in a consequential position will have any sense of inferiority or lack of sophistication that could lead to paranoia. Many are from families that have been in the elite for centuries and in their present business for decades or longer; the rest are self-made strivers with ferocious self-confidence.
Second, your aspiration to be paid in equity is problematic. Family ownership, or at least control, of business is the default there. Many partners wouldn't consider paying you in equity; many others would be sure to have their lawyers only give you equity with significant limitations. Finally, the opportunity eventually to monetize your equity is going to be limited.
Third, of course you need introductions. A Colombian with sufficient capacity to engage in cross-border business is not likely to consider any cold calls, to say the least of cold emails, as a likely source for a business partner. But this is not a challenge, really -- between your lawyers and your bankers, you should be one phone call away from a well-connected Colombian in Miami or Madrid who can connect you onward to whoever you could possibly need to make specific introductions.
Fourth, I hope I am misreading you, but I suspect that the business model you have in mind may not work -- Free Trade Agreements and their implementing regulations have elaborate precautions around trans-shipment, which means that a Colombian enterprise is not going to be able freely sell to the US goods or services with a large component of value that they have originally imported from you.
posted by MattD at 5:02 AM on December 20, 2014 [2 favorites]
This thread is closed to new comments.
posted by brujita at 7:23 PM on December 19, 2014