A successful expat businessman, who owns an "adventure" franchise with locations around Thailand and now Cambodia, said to me last night that Cambodia is essentially Thailand 20 years ago. All you have to do is look at what worked in Thailand and do it here, and you will win. The return on your money is ridiculous, he says.

It certainly feels that way. There's so much construction going on in Siem Reap that you can hardly walk a block without seeing something being built or remodeled. There's building going on in every single direction I look if I step outside my hotel - it's insane. Come here 5 - 10 years from now and this place will be transformed (I predict the situation with the women will be very interesting by that time too once the money flows more).

On top of that, it's a snap to keep a current visa here, it's cheap as shit to live and party, and they welcome foreign entrepreneurs with wide open arms.

I've formerly been fired up on Myanmar as a place to dig some heels in, but I think the competition there is more fierce because everyone has their eyes on Myanmar right now. Hence the ridiculous rental prices in Yangon.

So just for the sake of brainstorming, if you could step back in time and go to Thailand 20 years ago, where would you start? Assuming you weren't walking in with a huge bank account already? Any other frontiersman with their eyes on biz ops in the Khmer Empire?

Note: Lest I paint too rosy of a picture, the political situation in Cambodia is extremely volatile right now. An older Cambodian guy whose restaurant I go to a lot always talks politics with me, and he advises not to go anywhere near Phnom Penh at the moment. Apparently, there's a lot of talk about revolution right now. Much like the ongoing political issues in Thailand.

Nobody in their right mind opens a business as a foreigner in those countries, aside from well connected chinese that open their sweat shops there which cater to big foreign corporations like H&M and foreign restaurateurs, who cater to the rich locals and expats.

Everything you own in developing south east asia can be taken from you in a whim and this happens all the time.

If you own a restaurant this is not likely to happen, but anything a local crony could run by himself will be taken from you sooner or later. The law only exists on paper in those countries.

Quote: (09-02-2013 05:44 AM)AsiaBaller Wrote:  

Nobody in their right mind opens a business as a foreigner in those countries, aside from well connected chinese that open their sweat shops there which cater to big foreign corporations like H&M and foreign restaurateurs, who cater to the rich locals and expats.

Everything you own in developing south east asia can be taken from you in a whim and this happens all the time.

If you own a restaurant this is not likely to happen, but anything a local crony could run by himself will be taken from you sooner or later. The law only exists on paper in those countries.

Any real life examples to share?

There has to be a way to survive the system.

Quote: (09-02-2013 05:49 AM)Thomas the Rhymer Wrote:  

Quote: (09-02-2013 05:44 AM)AsiaBaller Wrote:  

Nobody in their right mind opens a business as a foreigner in those countries, aside from well connected chinese that open their sweat shops there which cater to big foreign corporations like H&M and foreign restaurateurs, who cater to the rich locals and expats.

Everything you own in developing south east asia can be taken from you in a whim and this happens all the time.

If you own a restaurant this is not likely to happen, but anything a local crony could run by himself will be taken from you sooner or later. The law only exists on paper in those countries.

Any real life examples to share?

There has to be a way to survive the system.

Even the Philipine government has conned the company which owns the Frankfurt airport out of millions of dollars for the development of a new terminal at the Manila airport.

They refused to pay over 400 million dollars for the development.

The judge in the PIs that ordered charges against the government unsurprisingly got murdered: http://www.orientexpat.com/forum/5848-ju...-murdered/

The international court case was dismissed as Fraport had paid the locally necessary bribes to get the project approved.

http://www.philstar.com/business/202190/...-investors

"Investments" in countries like Myanmar and Cambodia are something for big corporations looking to exploit the local population, the countries natural resources or to build a big name hotel.

Locals cash in on everything else which is associated with economic development and exceptions confirm the rule.

The only people that tend to survive are those that run a small biz which relies on them as owners to run (i.e. western butcher, baker etc.) or outsourcers that just hire the local work force, which is not a business a local crony could take over.

Quote: (09-02-2013 05:44 AM)AsiaBaller Wrote:  

Nobody in their right mind opens a business as a foreigner in those countries, aside from well connected chinese that open their sweat shops there which cater to big foreign corporations like H&M and foreign restaurateurs, who cater to the rich locals and expats.

Everything you own in developing south east asia can be taken from you in a whim and this happens all the time.

If you own a restaurant this is not likely to happen, but anything a local crony could run by himself will be taken from you sooner or later. The law only exists on paper in those countries.

Thanks for your perspective, AB, and welcome to the forum.

That's certainly an opinion shared by many but it's not the only one. There are plenty of successful expat entrepreneurs in Southeast Asia. Are there significant risks? Yes, and most acknowledge that before getting started. Is it smart to be extremely cautious and hedge your bets as much as possible? Sure.

But I think to imply no one in their right mind would enter these markets is a bit extreme. I've met very grounded men all over the region who are doing extremely well for themselves.

Just like any developing country, there are real dangers involved but there's also quite enough reward to make it worthwhile when you get it right.

Also, you mentioned catering to rich locals and expats as if it was an aside. Those are two very lucrative demographics that create opportunities in a wide range of different industries. I'm not sure I understand why that was presented as an irrelevant exception...

You also mentioned outsourcing. That's definitely something I've considered as a business to set up here. So again, not sure why it's mentioned as if it's beside the point.

I think most of the men on this forum are level-headed enough to know that launching a business here is not something to be taken lightly. Meanwhile, I'd love to hear more of your ideas about what does work. Possibilities are much more interesting to me than impossibilities.

i would open up a hostel like they have done all over vietnam (the one with the buffalo logo)

Quote: (09-02-2013 07:31 AM)Que enspastic Wrote:  

i would open up a hostel like they have done all over vietnam (the one with the buffalo logo)

Can you elaborate? I only went to Vietnam for a month - is that a chain of some sort?

I looked up Cambodia in the World Bank's Doing Business rankings, which, while not totally reliable, at least reflect the opinion of transnational capitalists trying to operate in a particular place. Cambodia is pretty low in the rankings - 133 out of 185, but rising.

Like AsiaBaller said above, contract enforcement can be a problem in developing economies. So you want to think of something that doesn't depend on getting someone else in the country to deliver, or at least someone else you can't immediately replace with minimal cost.

You have to be the value added. Think of something the locals don't have a clue about, and run with that. That way, if you have a local partner, they depend on you. It's tough, because people everywhere can now do the most essentially "American" things. For example - I met the owner of the Saxophone Pub in Bangkok last night - he's a Thai guy. The bar hosts jazz, funk, and blues bands 7 days a week - almost all Thai musicians.

Even so, a bar might be the way to go, if you can become Rick in Rick's Cafe in Casablanca. Another idea is doing something in media to link Cambodia with Cambodian-Americans.

Another thing with cheap start-up costs is printing t-shirts with clever designs and phrasing for tourists and locals.

What's the local music scene like? Could you recruit and train kids to be pop stars like New Edition, New Kids on the Block and the K-Pop groups?

Quote: (09-02-2013 08:05 AM)Sp5 Wrote:  

Even so, a bar might be the way to go, if you can become Rick in Rick's Cafe in Casablanca.

Someone was telling me last night you don't even need a liquor license here.

Quote:Quote:

What's the local music scene like? Could you recruit and train kids to be pop stars like New Edition, New Kids on the Block and the K-Pop groups?

Interesting you mention that. I met a producer in Thailand that was doing that - older French guy. He recruits talent in Bangkok and promotes them in Hong Kong - turns them into stars. Lived in the most gorgeous custom home I've seen in Thailand with his old ass wife.

Worth checking out for those looking to open a business in Cambodia:

http://www.state.gov/e/eb/rls/othr/ics/2013/204614.htm

Quote: (09-02-2013 07:27 AM)Beyond Borders Wrote:  

Quote: (09-02-2013 05:44 AM)AsiaBaller Wrote:  

Nobody in their right mind opens a business as a foreigner in those countries, aside from well connected chinese that open their sweat shops there which cater to big foreign corporations like H&M and foreign restaurateurs, who cater to the rich locals and expats.

Everything you own in developing south east asia can be taken from you in a whim and this happens all the time.

If you own a restaurant this is not likely to happen, but anything a local crony could run by himself will be taken from you sooner or later. The law only exists on paper in those countries.

Thanks for your perspective, AB, and welcome to the forum.

That's certainly an opinion shared by many but it's not the only one. There are plenty of successful expat entrepreneurs in Southeast Asia. Are there significant risks? Yes, and most acknowledge that before getting started. Is it smart to be extremely cautious and hedge your bets as much as possible? Sure.

But I think to imply no one in their right mind would enter these markets is a bit extreme. I've met very grounded men all over the region who are doing extremely well for themselves.

Just like any developing country, there are real dangers involved but there's also quite enough reward to make it worthwhile when you get it right.

Also, you mentioned catering to rich locals and expats as if it was an aside. Those are two very lucrative demographics that create opportunities in a wide range of different industries. I'm not sure I understand why that was presented as an irrelevant exception...

You also mentioned outsourcing. That's definitely something I've considered as a business to set up here. So again, not sure why it's mentioned as if it's beside the point.

I think most of the men on this forum are level-headed enough to know that launching a business here is not something to be taken lightly. Meanwhile, I'd love to hear more of your ideas about what does work. Possibilities are much more interesting to me than impossibilities.

In cambo you're stuck with restaurants in my opinion, as a business that is likely to stay open if you manage to find a clientel. A hostel for example any local could take over or get it shut down while setting up shop next to it. The chinese expats are catering to the "richer" locals already via online shops and I think there is no market for anything much higher end than that.

If you want to get into outsourcing you should head to the Phillipines instead. The education in cambo is a joke and you won't find many skilled IT people there.

Making money via the internet is so much easier than dealing with all the headaches of running a smaller business in a country like cambo.

What's the status of steroids in Cambodia?

I'd open a juicers gym if they're legal, and make holidays based around high speed internet, cheap juice and top quality logistics for game.

Quote: (09-02-2013 08:53 AM)AsiaBaller Wrote:  

Making money via the internet is so much easier than dealing with all the headaches of running a smaller business in a country like cambo.

That's something we can definitely agree on. I think I only even consider leaving the computer at all because it sounds more exciting than plugging away in my room all the time, but the reality is that I'd probably get burnt out and feel trapped if I ever did try. Life is good as it is.

By the way, where are you based, if you don't mind?

Quote: (09-02-2013 05:49 AM)Thomas the Rhymer Wrote:  

Any real life examples to share?

There has to be a way to survive the system.

I don't know if it's the same in Cambodia, but in Thailand a foreigner cannot have more than 49% shares of a company.
It means, most of expats living in Thailand running business have a Thai wife who owns 51% of everything.

Like Redbull, is owning by an Austrian guy, but the real owner is a thai who owns 51% of the company.

I have to agree with many of the views already expressed. I would not get involved with business in Cambodia as the risk/reward is not good enough.

20 years ago in Thailand someone did not have the option on doing business on the internet. His only option was to create a local business. You have a much better choice and that is a business that can travel with you anywhere you want to go. Imagine how trapped you would feel if 3 years in you get tired of Cambodia and want to leave but have all your assets tied up in your business. Just not worth loosing your lifestyle over.

Having said all that if you really wanted to make $ in Cambodia I would not go the bar/hostel/tourism route. I would work on learning real estate and foreign business law, while making as many connections as you can. The big money will be made in being a middle man that foreign companies can use when setting up businesses locally. If you can deal with big businesses who want to set up shop and you are able to guide them through the process that is worth a fortune to them and having a local asset that is knowledgable is a must. Beyond that you have Foreign governments and the U.N. that have huge budgets that you could do deals for down the road once you have a reputation.

I would only choose that option if you insisted on not working online. The freedom of an online business is so great I would find it hard to give up unless you knew you would make crazy money.

Quote: (09-02-2013 09:39 AM)zuma Wrote:  

Quote: (09-02-2013 05:49 AM)Thomas the Rhymer Wrote:  

Any real life examples to share?

There has to be a way to survive the system.

I don't know if it's the same in Cambodia, but in Thailand a foreigner cannot have more than 49% shares of a company.
It means, most of expats living in Thailand running business have a Thai wife who owns 51% of everything.

Like Redbull, is owning by an Austrian guy, but the real owner is a thai who owns 51% of the company.

Just to clarify, no, it's not the same. Foreigners can own 100% of their company in Cambodia. In fact, there's zero barrier to entry for getting a business visa too. Most people buy it just to stay longer - you just pay the extra fee and keep extending.

Quote: (09-02-2013 09:46 AM)DirectDanger Wrote:  

I have to agree with many of the views already expressed. I would not get involved with business in Cambodia as the risk/reward is not good enough.

20 years ago in Thailand someone did not have the option on doing business on the internet. His only option was to create a local business. You have a much better choice and that is a business that can travel with you anywhere you want to go. Imagine how trapped you would feel if 3 years in you get tired of Cambodia and want to leave but have all your assets tied up in your business. Just not worth loosing your lifestyle over.

Having said all that if you really wanted to make $ in Cambodia I would not go the bar/hostel/tourism route. I would work on learning real estate and foreign business law, while making as many connections as you can. The big money will be made in being a middle man that foreign companies can use when setting up businesses locally. If you can deal with big businesses who want to set up shop and you are able to guide them through the process that is worth a fortune to them and having a local asset that is knowledgable is a must. Beyond that you have Foreign governments and the U.N. that have huge budgets that you could do deals for down the road once you have a reputation.

I would only choose that option if you insisted on not working online. The freedom of an online business is so great I would find it hard to give up unless you knew you would make crazy money.

You make some excellent points, DD.

As Warren Buffet says when other people are fearful it's time to be greedy. Cambodia looks good but Myanmar looks better. Real estate is something I would hedge my bets on but unfortunately I haven't been able to find a trustworthy local partner to do that. I've been hunting for cambodian-americans or burmese-americans who have the necessary connections in America and abroad to try and get something going but no dice so far. The problem with going into business with a real local is that they can rip you off with little recourse. If you find a dual citizen you can at least negotiate collateral of their assets stateside so they don't bail with your investment.

I find the same principle applies in Thailand. The most successful expat businessmen there (think the Pizza company guy) had fantastic connections to begin with.

Quote: (09-02-2013 10:21 AM)El Chinito loco Wrote:  

As Warren Buffet says when other people are fearful it's time to be greedy. Cambodia looks good but Myanmar looks better. Real estate is something I would hedge my bets on but unfortunately I haven't been able to find a trustworthy local partner to do that. I've been hunting for cambodian-americans or burmese-americans who have the necessary connections in America and abroad to try and get something going but no dice so far. The problem with going into business with a real local is that they can rip you off with little recourse. If you find a dual citizen you can at least negotiate collateral of their assets stateside so they don't bail with your investment.

I find the same principle applies in Thailand. The most successful expat businessmen there (think the Pizza company guy) had fantastic connections to begin with.

Yo Chinito - when you say you're hunting for a cambodian-american or burmese-american, what do you mean? Are you actively doing this or just keeping an eyelid propped open? What is your networking process?

I read an article a while back about a burmese-American who had moved out to Myanmar and teamed up with a local. They're making a killing importing cars.

Quote: (09-02-2013 10:21 AM)El Chinito loco Wrote:  

As Warren Buffet says when other people are fearful it's time to be greedy. Cambodia looks good but Myanmar looks better. Real estate is something I would hedge my bets on but unfortunately I haven't been able to find a trustworthy local partner to do that. I've been hunting for cambodian-americans or burmese-americans who have the necessary connections in America and abroad to try and get something going but no dice so far. The problem with going into business with a real local is that they can rip you off with little recourse. If you find a dual citizen you can at least negotiate collateral of their assets stateside so they don't bail with your investment.

I don't know if you speak some French, but there are a lot of people living in Paris coming from Cambodia, Laos and some from Vietnam.
What we call Chinese quarter in Paris is in fact a place full of Cambodia and Laos people.
I know a friend of my mother, who is working near Paris, he's from Cambodia. He will retire next year and will go back to his country where he has his family. He bought an House in Cambodia, it's very cheap and he can live and help his family with his retirement allowance.

The young generation from Cambodian descendant in Paris don't speak the language, or some, but they still have connections through their family. People over 50 years old speak the local language.
It's the same in Cambodia, old people speak good French because of the Indochine.

Quote: (09-02-2013 10:37 AM)Beyond Borders Wrote:  

Yo Chinito - when you say you're hunting for a cambodian-american or burmese-american, what do you mean? Are you actively doing this or just keeping an eyelid propped open? What is your networking process?

Burmese or Cambodians who either grew up in the U.S. or are naturalized U.S. citizens and who can speak the local language but still have some family connections back there.

I've been talking to a few about investment. These are people I come across in Southern CA in the asian "community" and various functions. The problem with Cambodians abroad is that a lot want nothing to do with that country anymore. Long Beach has a pretty large Cambodian community. It's tough finding people who are serious without criminal backgrounds in CA though.

Quote: (09-02-2013 11:13 AM)zuma Wrote:  

I don't know if you speak some French, but there are a lot of people living in Paris coming from Cambodia, Laos and some from Vietnam.
What we call Chinese quarter in Paris is in fact a place full of Cambodia and Laos people.
I know a friend of my mother, who is working near Paris, he's from Cambodia. He will retire next year and will go back to his country where he has his family. He bought an House in Cambodia, it's very cheap and he can live and help his family with his retirement allowance.

The young generation from Cambodian descendant in Paris don't speak the language, or some, but they still have connections through their family. People over 50 years old speak the local language.
It's the same in Cambodia, old people speak good French because of the Indochine.

How many of these Cambodians are the ones who fled to France after the Khmer Rouge?

My impression is that the more desperate refugees went to the U.S. and ended up in the ghetto in places like Long Beach and south central Los Angeles.

Maybe the Cambodians in France are more middle to upper middle class refugees?

Quote: (09-02-2013 12:31 PM)El Chinito loco Wrote:  

How many of these Cambodians are the ones who fled to France after the Khmer Rouge?

My impression is that the more desperate refugees went to the U.S. and ended up in the ghetto in places like Long Beach and south central Los Angeles.

Maybe the Cambodians in France are more middle to upper middle class refugees?

Today, there are around 1 million Asian people in France. It's very difficult to give you some details about their roots as it's forbidden in France to do racial survey.

Anyway, the Asian are very well educated and successful in France. They have a lot of business.
For example, 50% of the Asian women in France have a High Degree whereas for the native French women it's around 37%.

Quote: (09-02-2013 01:42 PM)zuma Wrote:  

Anyway, the Asian are very well educated and successful in France. They have a lot of business.
For example, 50% of the Asian women in France have a High Degree whereas for the native French women it's around 37%.

Most asians in the U.S. have done well too but the SEA immigrants (Cambodians, Laotions, etc..) mostly lag behind Chinese, Japanese, Korean etc.. NE Asian immigrants. I suspect Asians in France may in fact be more accepted into mainstream society than the U.S. I have met a ethnic Thai person who lived in France for 20 years, he saw France as part of his heritage which is pretty rare if you know how Thai people are.

There's still a lot of prejudice/social bias against asians in the U.S.

Intermediary is where the big rewards will be. There is always a need for a middleman to do the shady go-between-deals that the big corps can't officially touch.

A family friend recently got a multi-million contract in Ukraine for facilitating a large airport contract+processing center next to the airport.

The big money is always in real-estate, construction permits, travel permits, export/import semi-smuggling, rare goods and of course raw materials (oil, gas, bitumen, gold).

The best "service" as a foreigner is a teacher of higher ed classes that cater towards locals going to the USA/Britain/Switzerland to study/work. Things like tutoring for TOEFL, SAT, ACT, various university placement exams. I know an SAT company that makes serious bank (pays teachers 4-5k dollars/month in thailand).

Quote: (09-02-2013 03:46 PM)DVY Wrote:  

Intermediary is where the big rewards will be. There is always a need for a middleman to do the shady go-between-deals that the big corps can't officially touch.

A family friend recently got a multi-million contract in Ukraine for facilitating a large airport contract+processing center next to the airport.

The big money is always in real-estate, construction permits, travel permits, export/import semi-smuggling, rare goods and of course raw materials (oil, gas, bitumen, gold).

The best "service" as a foreigner is a teacher of higher ed classes that cater towards locals going to the USA/Britain/Switzerland to study/work. Things like tutoring for TOEFL, SAT, ACT, various university placement exams. I know an SAT company that makes serious bank (pays teachers 4-5k dollars/month in thailand).

That is impressive, what sort of qualifications is needed to get a descent job over there. I've heard that unless you have a passion for teaching, Thailand isnt a place to do it as they pay you really low unlike other countries.