If you want to win the confidence of the parents of Chinese students, you must give them detailed introductions to the EB-5 process and to your project. As in any legitimate business deal, they would want to confirm that the project promises a reasonable opportunity to meet or exceed their expectations. We’ve talked a good deal about the need for the student (and the parents) to be able to trust you. They must also be able to “trust the project itself. Your integrity will be signaled by your full disclosure of all the realities of the project. Once you have gained their interest with a project overview and a detailed prospectus, it is time to invite the client to the EB-5 project site.
The first person to invite is the student. If he finds it appealing, he will be inclined to invite his parents to visit the site as well.
Here is where we must add an important caveat. You should be prepared to do much more than show them the site. You should provide complete documentation, even beyond what is customary, to prove that the property and the project you are showing them is exactly what you have discussed and detailed. Deeds and documents of incorporation are essential. Present verifiable documentation that links directly to the property and business in question.
Often what Americans in China see as unscrupulous business practice, is considered the norm by the Chinese. They have accepted the modus operandi, but it has caused them to be wary of dealings with other cultures. For this reason, they may be suspicious of your motives.
When trying to attract U.S. business to their country, it is a common practice to appeal to a U.S. business on the pretense of manufacturing components or complete products exclusively for them in a dedicated facility. They will even show photos of the facility. What they do not tell you is that they are selling the same bill of goods – and often the same product – to your competitors.
Of course, you are invited to come to visit at any time to see the factory. It only becomes problematic when more than one of their “exclusive” customers shows up on the same day. This is not hypothetical. It has happened. There are cases where the first group to visit is ushered into a private area where they are unable to see the second group, and where the second group cannot see the first. Once the first group has been escorted out of the building, via a path that does not cross that of the second group’s,
the cover-up has succeeded.
If Chinese businessmen have no compunctions about doing that to Americans, why would they not expect Americans to do the same thing to them? Legal or illegal, moral or amoral, the practice is a norm. If it is considered a norm in China, why would Chinese investors consider it abnormal in the U.S.? What I am telling you here is to go above and beyond “the norm” to prove conclusively that everything that you have said or presented, including the project site, is what you have promised it to be.
Provide them with proof of your integrity and hold yourself to a significantly higher degree of accountability than they are accustomed to seeing.
Even though a student communicates a project to his parents, you should extend a more formal invitation to them. Send that invitation in a format that reflects your professionalism and your respect for their status. You are inviting them to invest a minimum of $500,000 and, in most cases, probably much more than that. Be courteous enough that they understand you are offering an opportunity for them to invest and expect a reasonable return – not to mention to establish permanent U.S. residency. Do not go over the top with your courtesy, however; that can create the impression of a con
artist. Be real.
A visit to tour the project site and review business plans should be at the potential client’s expense. This is not Las Vegas and they are not your whales. They are candidates for an EB-5 visa project because they can afford it. They can surely afford the airfare. On the other hand, you may wish to foot the bill for a nice hotel room for the amount of time attributable specifically to the presentation of the project. Look at it this way: they show their serious interest when they pay for their flight; you show your credibility by paying for a nice, not extravagant, hotel room. If you are confident that the client is genuinely interested in the project and you are sure that he is, offer to pay for a second trip for the express purpose of reviewing and closing the deal.
A visit by a prospect to your project may be the single best opportunity to close the deal, but it is also — and more importantly — the single best opportunity for you to get to know your client, and for them to get to know you. Therefore, focus on the latter. One way of accomplishing your objective is to actively request prospective clients’ input not about their level of interest, but about how they would run the business and, in particular, what they see as the SWOT factors. By doing this, not only will you profit by gaining important insights, but their input becomes their initial investment in the project.
Two Suggestions
One: English may be the business language of the world, but that does not mean that everyone speaks it or that those who speak it do so fluently. You should expect to have to overcome a language barrier. I am about to share a secret that most American businessmen never understand: Because of the barrier, you have no idea how much the other person really knows or comprehends. Foreign businessmen all over the world have often used the language barrier to obscure their thinking.
People of other cultures and languages are accustomed to faking us out by pretending that they do not understand English. I knew a highly respected businessman (not from China) whom I thought, for years, did not understand English. He always used an interpreter. One day, after about eight years doing business together, he spoke to me in fluent English. You could have knocked me over with a feather. He had finally arrived at a point where it was wasting our time to have an unnecessary translator.
Application: There is a huge temptation for American businessmen to show off their skills at speaking Mandarin. Don’t do it. Hire a fluent interpreter of Mandarin and make sure that he or she will be loyal to you. You should do this regardless of what you know or do not know about the language. The very best way to do this is to introduce the translator as an associate. Do not have them translate. Have them listen! If absolutely necessary, hire another person to do the real-time translating. You will learn more about what the potential client is thinking by a regular debriefing with this associate than nearly any other way. In no case, whatsoever, should anyone know that your “associate” understands
Mandarin.
Two: Do not worry about your competition. Be aware, but do not worry. When the Giants play the Dodgers, the Giants are focused on doing what they themselves do and doing it well. When they play the Cardinals, they are still focused on doing what they themselves do, not on the competition. Go to batting practice. What they are doing has everything to do with improving their own skills, not focusing on the other team. In no case, whatsoever, should anyone know that your “associate” understands
Mandarin.
Two: Do not worry about your competition. Be aware, but do not worry. When the Giants play the Dodgers, the Giants are focused on doing what they themselves do and doing it well. When they play the Cardinals, they are still focused on doing what they themselves do, not on the competition. Go to batting practice. What they are doing has everything to do with improving their own skills, not focusing on the other team.
You are not the only one on the playing field with an EB-5 project. It is possible that a potential client is looking at multiple opportunities, some of which are not yours. As Tony Soprano would say, “Fuggetaboudit.” Your business is your business. Their business is their business. Stay focused on the right thing: your business. You do not have to land this particular fish; there are a lot more where this one came from.