The Worst Start-Up, Ever!

Angel sheet is the worlds first fully-social, AI infused, machine learning toilet paper, on the blockchain.

Behold, Angel Sheet.

Angel Sheet is the worlds first fully-social, AI infused, machine learning toilet paper, on the blockchain. Yes, you heard me correctly.

You see, Angel Sheet does what no toilet paper has done before, optimizing its cleaning mission with artificial intelligence, learning your individual needs and improving with every use.

Best of all, it is on the blockchain; you can buy crypto tokens to securely keep track of your commode progress and only share it with your absolute best friends.

Best of all, Angel Sheet monetizes the back-end data, selling valuable water usage and disease vector data to hedge funds and medical research companies. This data value alone will enable the company to lower the cost to the consumer of the basic TP product close to zero.

Better yet, Angel Sheet will create an advertising marketplace for its basic product, infusing each sheet with paid images of the hottest trends, influencers, or political ads. Because it is fully connected to the Facebook API, it knows your preferences and adjusts automatically to your needs.

We estimate that everyone in the world will have to have it someday, it will replace all TP as we know it.  That means our potential market cap is somewhere between Amazon and Google.

Oh, and did I mention our seed round, pre-MVP valuation range is expected to be somewhere between $500 million and a cool billion. Conservatively.

Authors Note: I came up with this pitiful idea after reading a ton of excellent submissions to our recent accelerator class, interspersed with, well, some Angel Sheet. Enjoy.

3 Economic Rules Every Crypto Start Up Must Obey

There’s a ton of people infusing cryptocurrency and blockchain into traditional businesses and asset classes claiming to have some revolutionary breakthrough when, in fact, the business value proposition is nothing more than, well, bananas.

We see a lot of crypto start-up ideas that go something like this:

“We’d like to put bananas on the block chain and trade them with utility tokens. It will revolutionize produce sales globally. Our pre-money valuation for the seed round is 2 trillion dollars.”

I’ve taken some editorial license here, but you get the idea. There’s a ton of people infusing cryptocurrency and blockchain into traditional businesses and asset classes claiming to have some revolutionary breakthrough when, in fact, the business value proposition is nothing more than, well, bananas.

I thought I’d take the time to put down some basic “cryptonomic” rules to help would-be, block chain titans evaluate if their idea is gold or goop.  It all begins with Ronald Coase at the University of Chicago, Laureate for the 1991 Nobel Memorial Prize in Economic Sciences (yes, it does have a cool sounding official name).

In 1937 (yeah, it takes that long to win the Nobel prize), Coase wrote a paper called the Nature of the Firm that revealed the fact that transaction costs are almost always material and do shape economic transactions.  For example, if it takes too many clicks of the mouse to buy something online (a non-monetary transaction cost of your time), you’ll just go buy something on another website. Transaction costs, while not always monetary, affect our willingness to buy, sell, and engage in a market.

Why does this matter to crypto? Because what crypto and blockchain do, precisely, is reduce transaction costs for certain economic activities. For example, bitcoin makes it possible to transfer money between parties without fees, or oversight from your bank, government, etc. That transaction cost can be high (prison) if you’re a drug trafficker or engaging in some other illicit activity. That is why so much illegal activity is transacted using virtual currencies. They lower the transaction cost of the exchange sufficiently to justify the risk of volatility inherent in virtual currencies. I’m not advocating using virtual currency for illegal activity, I’m just saying that it happens for well-understood economic reason.

Overall, bitcoin is probably the lowest transaction cost method to transfer “money” securely to anyone, anywhere, for any reason, and at any time.

This leads us to crypto start up rule #1 – the use of crypto or blockchain must lower transaction costs for the economic activity it underwrites.

If you’re not actually making it easier to transact an economic activity using your business plan, then you’re not creating consumer surplus above traditional market activities and no one will adopt your platform after the initial hype wears off.

The second rule of crypto start ups is due to a government body that was created as an indirect result of Ronald Coase and his pioneering work on transaction costs: the Securities and Exchange Commission (SEC). Some asset transactions require government oversight to even the playing field in public market transactions. This is because asymmetric information (when one party has inside information about the value of something) leads to fraudsters dumpling worthless assets on less-knowledgeable persons. If this insider trading was allowed, it would impose a major transaction cost on public markets from a fundamental lack of trust between two parties in any asset exchange.

To remedy this, the SEC regulates certain asset classes that are publicly traded to ensure that all information provided from insiders with non-public information about an asset, and have control over that asset, share that information with all market participants simultaneously and do not manipulate markets to their advantage. If you try to create an asset for public trade, and then benefit from trading it with inside information, you will go to jail.

This is rule #2: Don’t go to prison. Sounds simple, but for some crypto folks, this is a difficult idea to master. If you intend to create an exchange for your crypto tokens where they can be held, bought and sold, then you’re business should be regulated by the SEC and you need to hire a regulatory attorney who specializes in crypto assets and make sure that you’re idea is lawful with appropriate disclosures and oversight. This isn’t cheap to do, but going to prison is definitely more expensive.

Hmm, does that mean prison is a transaction cost of criminal activity?  You bet it is!

Now, on to rule number three.

Blockchain is a secure way to share information, plain and simple. If you want to use it for a business purpose, then by so doing it needs to be a transaction where securely sharing information on the blockchain lowers transaction costs sufficiently to act as an incentive to increase underlying economic activity . For example, putting banana information on the blockchain doesn’t really help a person buying them at their local Target store get better information in a manner that is more convenient than the sign at the store; however, securely transmitting point of agricultural origin data may be helpful to Target if they have to certify to their shoppers that the banana is organic and their sign is accurate.

To simplify, rule number three is that blockchain should only be used when it lowers transaction costs to securely share and maintain information critical to the underlying economic exchange.

Now, if you’re a crypto entrepreneur, you still have to abide by the basic rules of good startups (link shamelessly inserted if you missed it before). So don’t think that if you do merely these three things, you’re going to be the next Winklevoss twins and the living is easy. Getting any startup off the ground is still a knife fight in an alley with Andre the Giant and he has a gun (as we often say at Sputnik ATX).

These are just economic realities that any crypto start-up will ultimately have to face, so better to know up front and assess if your idea has merit before you push your life savings into the next banana-crypto debacle.

In summary:

Rule 1:  The use of crypto or blockchain must lower transaction costs for the economic activity it underwrites.

Rule 2:  Don’t go to prison, hire a regulatory attorney and obey the law.

Rule 3:  Blockchain should only be used when it lowers transaction costs to securely share and maintain information critical to the underlying economic exchange.

No go out and make Ronald Coase proud: start lowering those transaction costs crypto entrepreneurs!

 

Schrödinger’s Start-Up – Why VCs Don’t Sign NDAs or Non-Compete Agreements

Every so often, I get an email from an entrepreneur that starts something like this:

“By reading further, you agree to the terms of our non-disclosure and non-compete agreement”

My immediate reaction is to delete these emails with prejudice.  I am not alone.

VCs get inundated with pitch decks and proposals for new technology.  NDAs or NCAs destroy our ability to freely invest in good ideas, so it is almost impossible to get a VC to sign one.  Asking for one, in and of itself, demonstrates a lack of sophistication on the part of an entrepreneur.

The reality of your start-up, whether you want to admit it or not, is that your idea is not Schrödinger’s cat.  This refers to a paradox first proposed by Austrian physicist Erwin Schrödinger in 1935.

A gross oversimplification of the paradox goes something like this: A cat is in a box with a sensor and poison. You don’t know if the cat is alive or dead. If you open the box to see the state of the cat, the sensor will break the poison and kill the cat. Thus, you don’t know if the cat is alive or dead, and even trying to verify this will result in the outcome of death.

As a start-up company, you may feel like opening the door to someone seeing your idea will kill it, or at the least subject it to competition as others race to replicate your genius, a-la Schrödinger’s feline friend.  The reality is far from that.

As a venture-backed start-up, you may benefit from stealth mode to prevent copying for a season, but ultimately comes a time when your technology must be promoted and made known to the world in order for you to find commercial success.  Growth is the only metric that matters to a VC, and it is impossible to do this if no one can look at the cat, so to speak.

If the time for the world to know your company is not yet arrived, well then, neither is it the time right for me to consider investing in your company.  VCs want to invest when the time-value of their money will produce the best result in the shortest period of time.  That time usually happens when you’re ready to go to market (seed stage) or getting traction and want to scale (A round investing).

So if you think your idea is so awesome that anyone in the world even knowing about it would kill it, then you’re not really ready to talk to VCs yet.  We like to get involved when you’re ready to let the cat out of the bag, and not be Schrödinger’s start-up.

How to Get Your First Sale

The customer’s own emotions and desires should drive the conversation naturally into your solution, not the other way around.

Trying to get your first paid customer can be tough, especially when you have to do more than just sign up for Google AdWords and -gasp- engage with other humans to complete a transaction of goods, services or both. So if you’re start-up model is just getting eyeballs and selling clicks, this post isn’t for you. This article is about how to get a paying customer for anyone who is doing more than just selling advertising on a site.

When you started your company, I will assume that you had an idea for some awesome thing that would generate a ton of consumer surplus. If you don’t know what this is, please read this first. Now, back to your great consumer surplus generating concept, I assume you have. This minimum viable product is untested, so you’re not sure yet if the “baby is ugly”. Truth is, it probably is ugly, and if you do the start-up sales process correctly, you’ll learn helpful product information that will not only help you sell the baby, but get some good plastic surgery to make that baby pretty.

First things first, find the people who you think will want the product/service. You should be able to network naturally into the person with the problem. If you can’t then you probably don’t know the industry well enough to understand their problems, let alone solve them, and it was a bit presumptuous for you to quit your job, mortgage the house, and risk it all on something you didn’t understand.

Networking into the sale usually means that you reach out to friends/acquaintances, or the friends/acquaintances via direct introduction (email or face to face). Just don’t spam the universe on LinkedIn, everyone hates that and it won’t help you as much as a targeted approach on people who can get references on how smart you are, how good your company is, etc. Those references and network information will help overcome the barrier to buy your future customers face.

The barrier to buy is the cost that a customer incurs to do business with you. That isn’t just money that they pay you, but the value of their time, risk to their current business operations, etc. To make a sale, you have to convince someone that the total cost of doing business with you (time, risk, money) is far less than the benefit they will get from using your product. Since most of those factors are not money (easy to often assess by pricing) your future customer will estimate time and risk costs based upon how well you present yourself, how highly your network speaks of you in reference (your reputation) and the apparent ease of doing business with you from their own assessment.
You lower the perceived risk of these factors by responding to emails quickly, dressing appropriately for any face to face meetings, showing good manners (yes, in every classical sense of this), and not interrupting potential clients/customers.

Ok, so lets go to step two, after you’ve networked into the prospective customer, how should you introduce your company? Here are some basic rules:

1. Don’t push a product on the customer, ask them to talk about their problems first. It is sometimes easier to dig a pit and allow a boulder to fall into it, than move the boulder, since gravity is a lot stronger than even the most Popeye-esqe forearms. This means that the customer’s own emotions and desires should drive the conversation naturally into your solution, not the other way around.
2. At some point, you’ll see the opportunity to share how your company can solve the problem. When the customer need discussion opens that door, show how you solve the problem in 10 seconds or less. Brevity and simplicity gives you power. You don’t need to demonstrate every minute feature of your stuff, just put out there your solution in the simplest way, and be OK with a moment of silence after you say it. If the customer responds with curiosity, find out what specifically interests them in the solution, thus getting permission to delve into the part of what you do that they are interested in.
3. Make sure that your short explanation explains the consumer surplus they should expect from your innovation. It should be obvious how the product/service is going to be something they want.
4. Be honest that you just have minimum viable product at this time, and so you would appreciate getting feedback from them on how you can improve the product. It is important that they know you’re building the plane while flying it, so you can manage expectations. Good first customers will give you a lot of feedback and recognize it is in their interest to do so. If a company sees this as a burden, they’re not a good fit for your first sale.
5. Ask at what price they could say yes today (or the soonest their internal sales system permits). For customer number one, it is not about the revenue, it is about credibility and good feedback.
6. If they say no, then ask them why they aren’t interested, and follow up with additional questions so that you can understand how your product-market fit may not be right for this customer.
7. Before you leave, ask who they know that might be interested. Even when you’re getting turned down, they may know who will say yes. Even if they say yes, they may have a friend in the business who you can call next. Referrals are like gold.

And as a final note for some services where you generate a very massive consumer surplus, you may be able to get the customer to pay upfront for a product/service down the road. That is the holy grail, and should be pursued if you can get it, but don’t be greedy. This most often happens in industries where the customer is used to prepaying part or all of the price to get a service, but this isn’t always the case.

I once saw an innovative part manufacturer get a major industrial to pay them for the inventory cost of their first shipment so that they could go into production and deliver something that generated sufficient consumer surplus to cover the cost of capital above the cost of the part. Also, first customers may want to be investors, and the money they invest helps to not only lock them in as a customer but can also provide a potential exit for the sale of the company at a later date. Treat these first customers well!

What Every #Bitcoin Investor Should Learn From a Dictator Named “Awesome”

Bitcoin investors should learn a lesson from Awesome, a dictator who lost his life introducing the one of the world’s first fiat currencies

Bitcoin investors should learn a lesson from Awesome, a dictator who lost his life introducing the one of the world’s first fiat currencies.  A fiat currency is a form of money to exchange goods and services that has no intrinsic value.  For example, a gold coin is not a fiat currency, because it is made of gold, something that has value in, and of, itself.  Paper currency, like the US Dollar, is a fiat currency because the note has no intrinsic value.

Bitcoin has a lot in common with early fiat currencies, so let’s take a second to review fiat currency and take a quick history lesson from one of its early adopters.

First off, how does fiat currency get its value?  Fiat currency has value when:
1.  It has limited supply
2.  People believe it has value
3.  It can be easily transferred to facilitate economic transactions

Right now, Bitcoin meets all three of these standards. There is limited supply due to its unique block-chain encryption standards, people believe it has value from the increasing rate of exchange to the dollar, and it can be transferred easily to facilitate economic transactions using online Bitcoin wallets.  So how did fiat currencies get started and what can we learn from these early currencies about the future of Bitcoin?

In 1294 Gaykhatu (literally, “Awesome” in Mongolian) was the leader of one Hoard of Mongols ruling over what is now Iran, Iraq and Southwest Asia.  Taking his name a little too literally, Awesome decided that he needed fiat currency like that introduced by his distant cousin Kublai in China. 

Awesome was in the middle of a crippling drought in his territory, and after several years of expending all of the royal treasury building a seriously sweet palace (still unfinished, of course), he was broke. When he heard that Kublai was just printing his own money, he saw his path to riches and summoned the Ambassador from Kublai’s court, demanding to see the new paper currency.

So smitten with this idea, Awesome copied the idea and printed his own money.  He liked the notes printed by Kublai so much, he even copied the Chinese characters on them.  He demanded that everyone accept these new notes as currency.  However; Awesome had competing currencies.  He didn’t think about confiscating all the gold and silver currency in circulation and soon discovered that no one wanted his paper money (Kublai at was smart enough to make some of his Chao out of copper to help with the perception of value).

Awesome also launched his new currency during the worst cattle plague his realm had ever encountered, and printing new money at such a tumultuous economic event was just poor form.  Needless to say, no one thought Awesome was awesome.  Riots and violence broke out around his kingdom.

Topping it off, Awesome himself emptied out his treasury of the notes he printed for himself, buying lavish materials for his palace from merchants foolish enough to accept his worthless piles of paper.  Awesome was bankrupt, his markets frozen from the lack of a credible medium of exchange.

In the end, he was pelted with all manner of foul, medieval produce without refrigeration, and openly mocked over the irony of his increasingly worthless name.  His cousin was so angry, he didn’t stop there, he killed Awesome by strangulation with a bowstring and took over his kingdom. Yeah, that ended badly.

So, what does this have to do with Bitcoin?  Bitcoin has value only from the drug dealers, money launderers, illegitimate governments, and black market moguls who see Bitcoin as a valuable exchange to conceal their dirty doings. Like Awesome, these neer-do-wells created a virtual currency that can’t be traced to support their palace building.

And like Awesome, this party will crash back down to earth.  There are two primary structural problems to Bitcoin that will undermine its ability to satisfy all three standards for a fiat currency.

First, quantum computing stands to make any encryption 100% worthless in the next ten years.  We are rapidly approaching a future where there will be no secrets stored on computers, because no computer can encrypt itself sufficiently to prevent a quantum computer from hacking any and all methods designed to protect it, end of story.  This means that the encryption protecting Bitcoin itself, Bitcoin wallets, and any and all servers that are used to process and secure its ownership rights, will all be broken and worthless.  This destroys the fundamental premise of value, to say the least.  Goodbye limited supply!

Second, governments can block people from using Bitcoin as a measure of exchange.  Why would they do this?  Because Iran, North Korea, drug cartels, tax evaders, and money launderers are using Bitcoin to evade sanctions, bank laws, taxes, and pretty much violate every lawful economic law on the books.  They are already starting to do so, in China and South Korea, and the impact of this on Bitcoin value is just beginning.

At the end of Bitcoin, no governments will allow an asset class that has a primary purpose to undermine the faith of their regulated, lawful financial system and allow untraceable and untaxable exchanges of value between two parties.  In short, all these ICOs are a threat to the established global financial system, so the governments who created this system will not permit Bitcoin to stand.  You can’t fight city hall, let alone every major world government.

When these governments begin to go to war against crypto-currencies in earnest, belief that Bitcoin has value will plummet, the ability to use it to exchange goods and services will evaporate, and its demise will be the latest chapter in fiat currency collapse.  When this happens, I hope the Winklevoss twins have good security.  I’d hate to see them go the way of Awesome.

Joe Merrill is an Austin-Texas based venture capitalist at Sputnik ATX and Linden Ventures. Follow his blog at http://www.econtrepreneur.com or on Twitter @Austin_VC

Tax Facts – What Government Doesn’t Want You to Know

Warning: this blog post is about taxes. Taxes are an inherently boring topic, but useful if you want to understand something that will seriously impact your life. So, please read on if you want to learn the economics of what takes 40%-50% of your income. Otherwise, stop here and remain blissfully unaware.

There is a lot in the press these days complaining about the tax cut package passed by congress and signed by the President. Almost universally, the comments in the mainstream media have an agenda that appears to be almost perfectly tailored for the echo chamber created on each side of the aisle for the major news outlets’ political sponsors. However, a careful scrutiny of the history of US tax law (and tax rates) paints a very different picture of how these tax cuts will impact the United States insofar as its impact on the tax base and the demand-side of the economy.

While US tax law goes back to the very founding of the Republic and the tariff system created by Congress to fund it, personal income tax is a relatively new idea.  Although there was a brief period from 1861 to 1872 where a personal income tax existed to help pay for the civil war,  it wasn’t until the 16th Amendment was passed in 1913 that the government actually got the right to tax our incomes for the first time.

From 1913 until 1931 at the start of the great depression, the federal tax rate hovered at around 1.1% for the poorest families and while progressive (meaning wealthier families paid more than this), it was not punitive for rich people either, with 7% as the top bracket for people earning over $12mm a year in today’s dollars (adjusted for inflation).

However, from 1932 to 1941, Hoover and FDR had tax policies that, by any survey of the most liberal-minded economists, had disastrous results on the economy.  Tax revenue in 1931 was 834mm USD.  In June of 1932, Hoover decided that the worsening economy required government to start collecting more taxes to balance the budget.  Hoover almost tripled the top rate from 25% to 63%, and the low rate increased from 1.1% to 4%.

The amazing result was that tax revenue fell from $834mm to $427mm in 1932.  Why?  Well, when you take money from people’s pockets, they have less to spend.  Less spending results in less profits, and lower corporate tax collections (if companies are losing money, they don’t have profits to tax).  This fell further by 1933, with a mere $353mm in taxes collected as the economy continued to shrink and the government took more and more of the pie for itself (a concept economists call crowding out).  FDR raised them up to 76% when he took office (he raised the top rates to 76% by 1936) and unemployment spiked to 20%.  By 1937, FDR realized that his efforts to spend money to lower unemployment were only partially successful.  Unemployment was down to 15% but the government was spending huge amounts of money and creating large debts in the process.  

So why did this happen?  This has to do with the impact of taxes on the overall economy and the velocity of money. Since the government can only tax profits on money in circulation, the speed with which money moves around between firms in an economy have a major impact on taxes.  For example, if our economy only had four companies, and each company has $100 a year in profit on $200 in sales, then the economy would have $800 in sales, and $400 in profit to share. However, if the government taxes 50% of that profit, there is $200 less money for the companies to share with the economy, and the economy will shrink.  Now, think about how many times a single dollar is exchanged in a year between consumers and companies, and how each time the dollar is exchanged it creates a taxable event. More exchanges equals more taxes.

So if the government raises taxes very high, they reduce the number of taxable exchanges by the amount they took in taxes multiplied by the number of times those dollars would have been spent in a transaction. In short, the government is taking money so that it can’t be spent and then taxed.  While I’m not calling for the abolition of taxes so that we’ll have economic stimulus, it is a good idea to understand that when taxes go up, the economy goes down by a multiple of that tax collected.

However, at the time of these tax increases during the great depression, some Keynesian economists (those who believe that government expenditure is key to stimulating the economy) were shocked because these New Deal tax increases were increasing unemployment and New Deal spending wasn’t improving the economy to compensate.

Government spending was just helping us to limp along while incurring huge debts in the process since demand for government program spending far outstripped taxes collected.  Governments are like us, if they borrow a lot of money today, they will need more income in the future to pay off the debt and maintain their standard of living.  Sadly for us, when governments need to increase their income, they must raise taxes (taxes are the only way they get money legitimately).  So FDR decided to raise taxes again and again.  By 1940, the upper rate for wage earners was 94% for upper income earners, and 23% for anyone earning more than $500 a year.  Needless to say, the economy was so bad by this point, it took World War II to force dramatic changes in production and labor and end the depression.  At the end of WWII, Truman decided to start cutting government spending and lower taxes beginning in 1945.  Economists complained at the time that Truman was going to guarantee another depression, after all government spending is what they believed saved them from the depression getting worse, right?  Actually, Truman’s decision restored accountability in the economy and the nation grew to full employment in very short order.  Needless to say, the corporate tax rate was dropped from 90% to 38%, providing companies plenty of additional cash to grow and hire new workers.  In a recent survey, 2/3 of all economists agree that FDRs policies made the great depression worse and enabled it to stick around for a long time.

What does that mean for us today? Well, during the Obama administration taxes went up, and so did regulation (a quiet form of taxation because it raises the cost of doing business). So despite the Federal Reserve pumping unprecidented amounts of money into the economy through quantitative easing, the velocity of money (over 10 before Obama was elected) fell to just over 5 when he left office.

So, if we are to fix this, we need to have policies that would lower taxes and lower regulation to a sensible level. Both would be good ideas, if your goal is to grow the US economy. So when I hear people opposed to both of these, regardless of their intentions, we need to recognize that they are advocating policies that hurt the financial future of America’s families.

That is why it is all the more important to have sensible people in government who can not only enact policies that help working class families, but are able to explain these policies in a way that unites the American people behind them. Alas, that last part is what both parties appear to be lacking these days: leadership.

 

Note: some nut job out there may construe (how, I don’t know) this article as some sort of tax advice and then think about suing me. I’m not a tax adviser, this is not tax advice, so don’t make any tax decisions from my article.  And yes, this is proof positive that attorney’s can ruin our lives.

Free Money to Go International

International expansion seems spooky and very expensive for a start-up or small business.

It doesn’t have to be.

Don’t get me wrong, if you’re a start-up you should totally focus on the low-hanging fruit at home before you look abroad. However, if you have good traction and are ready to add some sizzle to your B round, a good international growth channel can dramatically expand the size of your addressable market and be easier to execute than you think.

You just need to know what FCS means.

FCS is the Foreign Commercial Service at the US Department of Commerce. Yep, you heard right, the government can help you. While this may be a shock to some people, the US government helps companies grow overseas, and even more shocking to libertarians: they really know what they’re doing.

The FCS has offices all over the world, and in major US cities, like Austin, taco metropole of the universe. These offices maintain commercial networks and cultivate business ties in the communities where they work. They permit US companies to access these networks, and they even screen and set up appointments for you in the countries where you’re looking to expand.

I’m getting ahead of myself and am clearly over excited about this, so let’s start from the beginning: how can you grow internationally?

First off, the world is quite large (I’m sure you noticed) so you can’t roam around willy-nilly and expect to find customers. You need to do a market study. This means that you survey the global market for demand for your product/services and identify areas where your product/service has the largest demand. You then overlap this with places that are import friendly to the US. Add a dash of channel research to identify the leading companies and paths to the customer in that market, and you should be able to analyze and identify the most promising place for you to export your good stuff.

So how do you do all that research? You don’t! The FCS will do this for you, and it is cheap (like a couple hundred bucks cheap). If you were to hire a consultant to do this for you there are two problems:
1. The consultant will be crazy more expensive, like tens of thousands of dollars
2. The consultant will give you bad advice, because no consultant has the breadth, information and experience of the entire US government at their disposal.

Think of it this way, do you want your intel from the government who also runs the CIA, or Barney the sales blogger who you found on the internet? Yep, no contest there. Get the FCS do to this for you.

Now that you have the research and have identified the most promising market, how do you find partners and expertise to enter the market? If you guessed, “ask the FCS”, then you have a cunning grasp for the obvious, and you may have just read about that when I got over excited earlier.

The FCS will, for a modest fee of a couple hundred bucks (see a pricing trend here?), contact companies in the international markets that you’re targeting and pitch them your company and then screen and identify those who are interested in working with you. Best of all, they have a staff of people in the local economy who speak the language and know the culture. No one will be accidentally offending the prospective partner’s family for five generations because they blew their nose at the wrong time.

Next up, setting up appointments to visit them either directly or online. You guessed it, FCS will do this for you also, for the couple hundred bucks we’re just going to mention again so you remember how this works.

Help you get a visa to travel there, yep, FCS will direct you to resources to help with that.

Add you to the local FCS trade show booth to promote your company and make more international connections?  OH YEAH! They do that too.

Give you thousands of dollars in grants to pay for the FCS fees, your travel to the international market, cover the cost of translations, etc, (and yes, this may seem like a bridge too far) but… HECK YEAH, they have block grants for this also.  Free money!

In short, the FCS will pay your company to use their services and even pay for your sales team to go visit and set up your first international sale.

I don’t know any consultant who will do that for anyone. The FCS will educate you on how to export, provide data on where to do it best, set up connections for you in the market, and pay you the money you need to do it (if you get the grant). This is the biggest sales no-brainier ever.

So, why are you still reading this blog post? Go out and contact your local FCS office and get busy exporting!