A founder called me last spring about entering Southeast Asia. Thirty minutes in, he had told me about three candidate partners: a distributor with “excellent relationships”, a sourcing agent recommended by his investor, and a potential local co-founder who had run a similar category before. He had a shortlist, a term sheet template, and a travel budget.

I asked him what the product had to retail for to make the market work. He said that was one of the things the partner would help figure out.

That is the whole problem in one sentence. He was not hiring capacity. He was hiring a judgement he had not yet formed, and he was going to pay for it with equity, exclusivity, or both.

I have watched this move repeat across dozens of founder conversations, and I have been on both sides of it. In the Jean-Michel Jarre hardware venture we built consumer products in China, and for the first stretch there was an agent sitting between me and the factory floor. Later, in Shanghai and then in healthcare across the mainland, I was the local partner that Western companies wanted to hire. I know what it looks like from the buyer’s chair and from the seller’s chair, and the gap between those two views is where founders lose years.

The pattern: an intermediary as a substitute for a decision

A new market presents a founder with three uncomfortable questions. Who exactly is the buyer, named and specific, not “mid-market retailers in the region”? What does the thing have to cost and sell for, after duty, logistics, channel margin, returns and the local tax treatment? And how do the first ten units physically move from your hands to someone who pays?

Those three questions have no answer you can read. They have answers you can only produce by making contact with reality: one factory floor, one buyer meeting, one awkward conversation where someone tells you your price is forty percent off.

Hiring an intermediary feels like progress on all three without the discomfort of any of them. You get a plan, a deck, a pipeline, a set of names. The founder’s calendar fills with partner calls instead of market calls, and that feels like the same thing. It is not. You have converted an uncomfortable unknown into a comfortable relationship, and the unknown is still sitting there, now one layer away from you.

I did this myself with Chinese manufacturing. The agent was genuinely useful at first: he spoke the language, knew which factories actually owned their tooling and which were brokers in disguise, and could tell a 300,000 unit line from a workshop with a good website. What I did not notice for several months was that every piece of cost intelligence I had was filtered through someone whose income depended on the spread. I knew the quoted price. I did not know the real price. Those are different numbers and the difference is your margin.

Why the obvious approach fails in a specific, predictable way

The failure is not usually fraud. Most agents and distributors I have worked with were competent and reasonably honest. The failure is structural, and it shows up in three places.

First, the intermediary ends up owning your market knowledge. Everything you learn about the market, you learn from them, which means you cannot evaluate what they tell you. If your distributor says the channel takes 45 points, you have no basis to argue. If your agent says the factory cannot hit the price, you cannot tell whether that is engineering reality or negotiating theatre. You have hired an advisor and a supplier in the same person, and nobody in that arrangement is paid to tell you the inconvenient version.

Second, they own the customer relationship. This is the one that kills companies quietly. Two years in, the end buyers know the distributor’s brand and the distributor’s rep. They do not know you. When you eventually want to go direct, or change partners, or raise your price, you discover that your “market presence” was actually rented, and the rent just went up. In consumer hardware, a channel partner with the retail relationship has the leverage to dictate your roadmap. They will tell you what colourway to make and what price point to hit, and because they are the only connection you have to the shelf, you will do it.

Third, and most practically: you cannot score them. This is the part founders skip. When you hire an intermediary before you have formed your own view, you have no benchmark. If the agent brings you a quote, is it good? If the distributor delivers 2,000 units in year one, is that strong or embarrassing? Without your own first-hand reference point, every result is acceptable because every result is the only data you have. I have seen founders keep underperforming partners for three years purely because they lacked the information to know the partner was underperforming.

When I was the local partner in China, Western companies would come to me having done exactly zero groundwork. I could have told them almost anything about the market and they would have had no way to test it. The good ones, the ones I actually enjoyed working with, arrived having already done one ugly cycle themselves. They had visited two factories, or sat with one hospital procurement director, or priced one shipment end to end. They asked harder questions and the engagement was better for both sides, because they could tell the difference between me doing a good job and me doing an adequate one.

The operator’s rule: outsource execution capacity, never outsource the decisions

The distinction that matters is between capacity and judgement.

Capacity is: somebody has to be in Shenzhen on Tuesday, somebody has to chase the customs broker, somebody has to call forty retail buyers and book twelve meetings, somebody has to translate the compliance documentation. These are real constraints and you should absolutely buy your way past them. Your time does not scale and a good operator on the ground is worth a multiple of what they cost.

Judgement is: who the buyer is, what the price has to be, which channel we commit to, what we will and will not compromise on in the product. These are the decisions that define the business. The moment you hand them over, you are not entering a market. You are funding somebody else’s business with your balance sheet and calling it expansion.

The practical test is simple. If the partner left tomorrow, could you still articulate the strategy? If the answer is no, you have outsourced the wrong thing.

Do the first ugly cycle yourself

Before you sign anyone, run one complete, small, embarrassing loop through the market with your own hands. Not a study. A transaction, or the closest thing to one you can manage.

That means one factory visit where you stand on the floor and ask what the tooling costs and what the minimum order is and what the unit price is at 1,000 units versus 10,000. One meeting with an actual buyer, a real retail category manager or a real procurement lead, where you present your product and let them tell you what is wrong with it. One pricing conversation where you say a number out loud and watch the reaction. One attempt at moving physical goods, even a sample shipment, so you learn what the paperwork and the landed cost actually are.

This takes most founders two to four weeks and one or two trips. It is uncomfortable, inefficient and will make you look slightly amateurish in front of people you wanted to impress. Do it anyway. You will come back with three or four hard numbers and one or two strong opinions, and those are the only things that make a partner negotiation survivable.

Then hire the intermediary, and hire them against a mandate you can score. Not “develop the market” but something closer to: fifteen qualified buyer meetings in ninety days, of which at least five at the named accounts we agreed, with a target landed cost under the figure we established, and a written monthly report on the two or three questions we care about. Define the term as something short, six to twelve months, with a renewal that has to be earned. Define who owns the customer data and the contact relationships, in writing, at the start, when it is cheap to discuss. Avoid exclusivity for as long as you can, and when you cannot, tie it to volume commitments that have teeth.

A good partner will welcome this. The ones who push back hardest on measurable mandates are the ones telling you, politely, that they intend to be irreplaceable rather than excellent.

What to do differently on Monday

If you are currently shortlisting partners for a new market, stop and ask yourself one question: what are the three numbers I would use to judge whether this person is doing a good job? If you cannot produce them from your own direct experience, you are not ready to hire. You are ready to travel.

Go do the ugly cycle. Get the quote yourself, take the meeting yourself, hear the rejection yourself. It costs you a few weeks and a plane ticket. Getting it wrong costs you your market knowledge, your customer relationship, and the three years it takes to get them back.

The intermediary is a tool, and a good one. But a tool only works in the hands of someone who already knows what they are building.

I write from twenty years of building businesses between Europe and Asia. If your company is facing this, start a conversation.