Go Global the Right Way: What to Do Before You Make the Leap

By Fergus Cleaver

It’s a big, wide world out there. Why not carve out some space for your business?

Even if you’re fortunate enough to do business in a big, prosperous country, expanding internationally is almost certain to grow your customer base—at least, if it’s done right.

And there’s the rub. Most international expansions fail because their architects drop the ball on the extensive planning, goal setting and scenario gaming necessary for any overseas gambit. If you’re not willing to put in more legwork than you ever thought possible—to cross your i’s, dot your t’s and pray that the chips all fall your way anyway—then it might be best to stick to your backyard.

For truly ambitious entrepreneurs, staying local isn’t an option. No matter what your company does or where it’s based, you need to do these things before you go global.

Make Sure You Have a Market

It’s every business owner’s nightmare: holding a sale that no one shows up for. To avoid this ignominious outcome, you need to do your homework—lots of it—ahead of time. Invest in local market research, analyze local and international competitors’ successes and failures, and speak with local business authorities who follow consumer tastes and trends. Remember: For every successful international expansion story, there’s a Target Canada debacle. Don’t be Target Canada.

Hire Local Talent

Buy local…talent. No matter how sharp your current team or how well you think you understand conditions on the ground in your target market, you can’t replicate a lifetime of insight or expertise. Before you go full-bore in a new country, make sure you have a solid team on the ground there—or, at least, an uber-competent local manager who can built that team from scratch.

Understand Local Rules and Regulations

It would be great if one set of business rules applied the world over, but that’s not always so. When you enter a new market, you need to be prepared to deal with a dizzying array of hard-to-understand regulations and customs. Some of these are “optional,” in that your business license won’t be revoked if you fail to follow them. Others, such as local tax regulations and labor laws, are not.

Raise Capital

You need to spend money to make money, and an overseas expansion isn’t your typical money-making endeavor. If you’re serious about doing things the right way, you’ll likely need to raise capital from your principals or investors before setting out. If this isn’t possible without overleveraging, hold off on expanding until your financial position is better.

There’s More?

You didn’t think this was all you had to do to launch your first international enterprise, did you?

This is just the tip of the iceberg. As noted above, it’s imperative for anyone considering an international expansion to speak with a raft of experts—peers, mentors, home country governmental authorities, trade organizations and overseas government contacts. There’s just no shortcut to international success. Doing it right means doing it the hard way. So get ready.

Bet You Didn’t Know These 5 Things About New Zealand

By Fergus Cleaver

If you have a globe handy, give it a spin. (Or just open Google Maps.) Take a gander at New Zealand, if you can find it. It’s down there, south and east of Australia, beyond the great constellation of tropical atolls and islands in the South Pacific.

Truth be told, New Zealand’s cities are among the world’s most isolated major population centers. Nevertheless, their host country holds an outsize grip on the global imagination—fueled in part by the blockbuster Lord of the Rings trilogy, much of which was filmed against an awe-inspiring Kiwi backdrop, but also by the islands’ unique, polyglot culture and friendly, laid-back lifestyle.

It’s okay to admit that you’re fascinated with New Zealand. Just don’t exaggerate how much you know about this one-of-a-kind island nation. Most non-Kiwis don’t know these five things about New Zealand, for instance. How many were on your radar?

1. Taumatawhakatangihangakoauauotamateapokaiwhenuakitanatahu

No typo here. That’s the longest place name in the English-speaking world. Of course, it’s not English—it’s Maori, New Zealand’s dominant pre-colonial language, and it roughly translates to “The summit where Tamatea, the man with the big knees, the slider, climber of mountains, the land-swallower who travelled about, played his nose flute to his loved one.”

Um, OK. Still, Taumata (as it’s mercifully known for short) is definitely worth a visit if you’re in New Zealand. It’s a prominent hill that peaks about 300 meters above sea level, near Hawkes Bay, on the southeastern corner of New Zealand’s North Island.

2. New Zealand Has No Terrestrial Snakes

Indiana Jones would love New Zealand. The island nation is home to exactly zero species of land snake. The lack of native snakes is no doubt due to New Zealand’s geographical isolation, and the lack of introduced species is probably down to the fact that snakes didn’t survive the long transoceanic journey back in the early days of colonization. New Zealand’s fragile ecosystem is beset by plenty of other invasive species, including such “mundane” creatures as common rats and possums.

3. New Zealand Has No Native Land Mammals Except Bats

Another crazy Kiwi wildlife fact: No native land mammals except flying rats!? It’s true. In prehistoric times, New Zealand was dominated by birds and reptiles, with the sole mammalian niches filled by furry, fruit- and insect-gobbling bats. The Maori, who arrived in New Zealand centuries before Europeans, introduced the first mammals, and things got really out of hand when the Brits came to town.

4. The First Bungee Jumping Company Started in New Zealand

Not surprising, given the dramatic landscape. Next time you’re dangling off a high bridge somewhere, remember what got you there—and, hopefully, what will get you out of the situation.

5. New Zealand Has More Golf Courses Per Capita Than Anywhere Else

New Zealand is often thought of as an adventure sports destination, and that’s undoubtedly true. But it’s also an unheralded golf mecca. The country has more than 400 courses—a huge number in a land with fewer than 4.5 million permanent inhabitants. The good news is that there’s less competition for tee times here.

A Non-Eye-Crossing Guide to Currency Exchange Rates

By Fergus Cleaver

Currency exchange rates are in the news a lot these days. Back in June 2016, when the United Kingdom voted to leave the European Union, the value of the British pound plunged against other world currencies, including the U.S. dollar and Japanese yen. People holding assets valued in pounds, or holding cash accounts denominated in pounds, collectively lost billions overnight.

How and why did that happen? The answer lies in the complex cause-and-effect relationships between the political, economic and even cultural forces shaping the global economy, and the subjective and objective public perceptions of the sovereign governments underwriting them.

Most people don’t know much about the ins and outs of currency exchange rates, nor do they understand how exchange rates fluctuations affect their daily lives. The good news is that a basic understanding of the relationship between global currencies, and the forces that make them tick, does not require an advanced economics degree. Here’s what you need to know—no fluff, just the facts.

Fiat vs. Gold Standard

Historically, sovereign currencies’ values were tied to the price of gold. For instance, back in the day, the value of the U.S. dollar was fixed at $35 per ounce of gold.

This arrangement suffered from systemic drawbacks. After manually adjusting the dollar-gold ratio, the U.S. government eventually abandoned the gold standard altogether. The replacement is known as fiat currency—basically, a dollar is worth whatever the government says it is.

Economic Strength and Weakness

Currency values serve as rough proxies for faith in the economic and political stability of their backers. For instance, the value of the euro declined precipitously (grew weaker) during the early 2010s, when it appeared that the European Union was in danger of collapse. The value of the U.S. dollar, whose backing government appeared more stable, rose (grew stronger) during that time.

Exchange Rate Effects

Exchange rates don’t just reflect the state of the broader economy—they can also affect it, both directly and indirectly. When a currency is stronger, its home country’s exports tend to cost more in international markets. When a currency is weaker, its home country’s exports usually cost less. Counterintuitively, then, a weak currency can actually be good for export-driven economies.

How to Calculate an Exchange Rate

Simple. Use an exchange rate calculator.

Though they rarely fluctuate wildly in one direction or another, exchange rates are quite dynamic. They’re living, breathing simulacra of the broader economy. If you’re curious about the precise value of a particular currency on any given day, use an exchange rate calculator or check popular currency pairs with a reputable financial resource, like CNBC. (Yes, CNBC is reputable, if you ignore all the breathless headlines.)

Profitable Exchange

The answer to the inevitable next question: Yes, you can make money on the currency markets. The same basic rule of trading applies to currency markets, just as it applies to equity markets: Buy low, sell high.

The foreign exchange market is often known as forex. It’s a complex and fraught landscape, one that you shouldn’t dive into without professional guidance. Suffice to say that thousands of gutsy professionals earn very good livings on the forex market. With the proper training and mindset, perhaps you can too.