A founder I was talking to last year had been in Shenzhen for eleven days. He came back with four business cards, three polite maybes, and one enthusiastic yes. The enthusiastic one had already drafted a distribution agreement, proposed exclusivity for Greater China, and offered to fly to Europe the following month at his own expense. The founder was thrilled. He asked me what I thought.
I asked him one question: what else does this company sell, and how is it going?
He didn’t know. Nobody asks that question, because when someone finally says yes after months of silence, the relief is so physical that curiosity shuts down. But the answer matters more than anything in the contract. In twenty years of building between Europe and Asia, in consumer hardware manufactured in China, in banking in Hong Kong, in a location-based platform that reached over 300,000 users, in healthcare expansion across the mainland, I have never once seen the first enthusiastic counterpart turn into the best partner. Not once. The correlation is so strong it has stopped being anecdotal for me and started being a filter.
Spare capacity is a performance signal, and nobody reads it
Here is the uncomfortable mechanic. A distributor, an integrator, a channel partner, a talent broker: they all have finite attention. A salesforce can carry a certain number of product lines. A business development head can run a certain number of pilots. When someone has room for you immediately, with real urgency, it is because something that was occupying that room left.
Sometimes the reason is benign. A contract ended cleanly, a category matured, they are deliberately repositioning. More often, something underperformed. A line they were pushing didn’t sell. A principal pulled the rights. A key account went elsewhere. They need a new story to tell their own boss, their own board, or their own bank, and your product is the story.
That is not a disqualification by itself. But it changes what you are buying. You think you are buying market access. You are actually buying the attention of a team that has recently failed to sell something, in a market where you cannot yet tell whether the failure was the product or the team.
The partners you actually want behave in a way that feels like rejection. They reply in nine days instead of nine hours. They ask you to come to them rather than offering to come to you. They want to see your product work somewhere else first. They have a pipeline and your opportunity has to displace something already in it. In my experience the strongest counterparts in Asia take between four and eight months from first contact to first commercial commitment, and that gestation is not inefficiency, it is diligence running in the other direction. They are vetting you as hard as you should be vetting them.
I learned this the expensive way in consumer hardware. Building in China, growing one product into eight, we had no shortage of people who wanted to represent us in new territories. The ones who closed fastest generated the least volume. The ones who put us through months of questions about spare parts logistics, warranty liability, and firmware update cycles were the ones who actually moved units, because those questions were not friction. They were the sound of someone modelling their own operational risk.
“We’ll study it” does not mean what “let’s keep in touch” means
Cross-border partner selection fails most often at the layer of interpretation, not strategy. Both sides are speaking English, usually as a second language for at least one of them, and both are using phrases that carry very different payloads in their home context.
In Shanghai or Shenzhen, “we will study it internally” is frequently a real statement about process. It means the decision is distributed, there is someone upstairs who has not yet been consulted, and the person in front of you is accumulating the evidence they will need to make the argument. It can be a soft no, but it is just as often the opening of a genuine internal sales cycle that you are not invited to watch. The right response is not to push for a decision. It is to ask what material would help them make the case internally, and then produce that material faster and in better shape than they expected. You are arming an advocate.
In Milan or Munich, “let’s keep in touch” is almost always a closed door delivered with good manners. The decision has been made in the room, by the person in the room, and the phrase exists to let everyone leave without awkwardness. Chasing it costs you credibility. Six follow-up emails to a European counterpart who said “let’s keep in touch” will not revive the deal, it will confirm that you don’t read signals, which is itself a reason not to partner with you.
The inverse error is just as common. European founders read Asian politeness as commitment and then build forecasts on it. Asian founders read European directness as hostility and withdraw from counterparts who were actually engaged. I have sat in meetings where a German buyer spent forty minutes attacking a product specification and the Chinese supplier left convinced the meeting had failed. It had not. That buyer was doing free engineering work. Interest in Northern Europe looks like interrogation. Interest in much of East Asia looks like hospitality followed by a long silence.
The practical correction is to stop reading tone and start reading resource allocation. Did they put a second person on the call? Did someone technical join? Did they send a document you did not ask for? Did they introduce you to a colleague who controls a budget? Those are facts. Enthusiasm is not.
Never sign exclusivity before a paid ninety-day pilot
If I could enforce one rule on every founder entering Asia, it would be this. Exclusivity is the single most requested and least earned term in cross-border partnership agreements. It is requested early precisely because it is cheap to ask for and expensive to give. A partner who asks for exclusive rights before they have sold anything is asking you to transfer your option value to them in exchange for a promise.
The structure I use instead is simple. Ninety days, non-exclusive, with money moving. The partner pays something: a stocking order, a pilot fee, a shared marketing commitment, a deposit against a minimum. The amount matters less than the fact of it. Money moving changes how an organisation behaves internally, because now someone has signed a purchase order and that person’s name is attached to the outcome.
Inside those ninety days you define three to five observable milestones that do not depend on revenue, because ninety days is often too short for a real sales cycle in enterprise or industrial categories. Number of qualified meetings generated. Technical certification completed. A named account in active evaluation. Sales staff trained and tested. Whether they hit those tells you more than a quarterly revenue number would.
Then, and only then, exclusivity becomes available, and it becomes available with teeth: tied to volume thresholds, reviewed annually, revertible to non-exclusive if targets are missed by a defined margin. In practice I aim for exclusivity that is renewable rather than perpetual, and I would rather give a generous margin than a long lock-up. Margin costs you money. Exclusivity costs you the market.
The founders who resist this usually tell me the partner will walk. Sometimes they do. In my experience, roughly one in three walks at the mention of a paid pilot, and in almost every case that was useful information arriving early and cheaply instead of eighteen months later with your market position frozen behind a contract you cannot exit.
The three questions, and the one that actually works
I ask every prospective partner three things, usually in the second or third conversation, never the first.
The first is about their current portfolio. What are the three products or services you represent today that generate the most revenue, and roughly what share does each hold? A real partner answers this quickly and with specifics, because they look at those numbers weekly. A business-card collector gives you a category list with no proportions. I am not looking for impressive numbers. I am looking for whether the numbers exist in their head at all.
The second is about the last failure. Tell me about a product you took on in the last three years that did not work, and what you did about it. The answer reveals their honesty, their process for killing things, and whether they take responsibility or externalise it. A partner who has never dropped a line is either very new or not telling you the truth.
The third is the one that matters most, and it is the one almost nobody asks. Who inside your organisation personally loses if my product fails?
If the answer is nobody, you do not have a partner, you have a listing. Your product will sit on a price list and nothing will happen. What you need is a named individual whose variable compensation, team headcount, or internal standing is attached to your outcome. Sometimes that is a product manager who championed you. Sometimes it is a regional sales head who committed a number to their own management. Ask for that person’s name, ask to meet them, and ask what they committed internally. If the counterpart cannot or will not produce that person, you are talking to someone collecting options, not building a business with you.
The pattern across all three questions is the same. You are not testing enthusiasm, you are testing exposure. Partnerships work when both sides have something to lose. The first partner who says yes, enthusiastically, immediately, with exclusivity already drafted, is usually the one with the least to lose, which is precisely why they can afford to move so fast.
Slow down. Let the silence happen. The counterpart who makes you wait four months and then asks you fifty hard questions is not being difficult. They are showing you, in the only language that is reliable across the Europe-Asia divide, that they take their own capacity seriously. That is the one to pursue.
I write from twenty years of building businesses between Europe and Asia. If your company is facing this, start a conversation.