14 ms·

Stripe opens its Atlas program to US-based startups

251 points by lebek 10y ago

patio11 10y ago
We've technically speaking got a lot of US startups on Atlas, but we're happy to have more. Today's announcement also includes a number of other improvements we've made the last few months. I'm happy to answer questions if anyone has them.
- mixmastamyk 10y ago
  When might the LLC track be ready? I'm looking forward to that. Thanks.
  - patio11 10y ago
    We ship first and then announce dates because down the other path lies disaster, but LLCs are a great way to incorporate many tech businesses, and Atlas aims to incorporate most tech businesses.
    - rubiquity 10y ago
      No offense but outside of our little HN/YC bubble I think it's the other way around. LLCs seem far more common than Delaware based C Corps for tech companies. For tech startups looking to raise venture capital (a subset of tech companies) a Delaware C Corp is far more common though.
      - valuearb 10y ago
        Aren't LLC's problematic for offering employee equity options? I've done lots of startups, and you want a structure that makes it easy to put together employee pools, easy to raise funding with, and easy to sell/merge. LLCs are easy to setup, but if they create lots of problems down the road it's not a structure you want.
        brianwawok 10y ago
        LLCs are a swim army knife. You can basically do anything, with way less rules and fees. LLCs can totally offer equity. LLC's are easier to sell than a C corp. Plenty of pluses. If you don't want to get VC funded, you should default to LLC.
        valuearb 10y ago
        Of course LLCs can offer employees equity. But it's not simple, and it's not easy. And its not just VC funding, you should be wary of LLCs if you think it's likely you will need any kind of investors, as typically investors prefer not want to deal with partnership K1s. If your startup is intended to be profitable quickly, and plans to distribute those profits to the founders, an LLC offers significant tax advantages. If you want to build a big business, it can offer some significant limitations.
        brianwawok 10y ago
        > And its not just VC funding Sure, I do not know many people getting non-VC funding, but I guess if that exists for you, you can consider it.. > If you want to build a big business, it can offer some significant limitations. Not sure that is really true. There are some HUGE LLCs. Say, Koch or Cargil. https://www.forbes.com/largest-private-companies/list/ https://www.forbes.com/largest-private-companies/list/
        valuearb 10y ago
        Again, LLC is a great fit if you have a profitable business and want profits can be paid as tax efficiently as possible to you and your other founders. You'll never need investors, you'll be able to borrow money because of your great cash flows, etc. And once in a while one grows to the moon while staying private and never go public. But for most startups, you can't know if you'll need to raise funding. And funding isn't just VCs. It's angels. It's friends and family. It's even crowd-funding now that you can crowdfund equity. And maybe you even get the opportunity to go public and want to be the most public market friendly cap structure. I have a friend whose e-commerce startup just broke over $100k per month in revenue. He's an LLC, but he's starting to realize that he doesn't have enough positive cash flow to pay for the equipment needed to lower his product costs, so now he's thinking of finding investors. And he needs a simple, easy to create equity program with vesting for key employees. And since he has no plans to be profitable soon, he's moving to a C corp. A C-Corp is $500. It's not expensive and is the most flexible foundation to build a startup business on. I'm also biased against LLCs because a problem endemic with LLCs which isn't necessary a fault of LLCs is that it's so easy to just start and go. I see founders who never consider vesting as a requirement. Four founders start an LLC and agree to each getting 25% equity split. Then one quits after a month and the remaining three have a big liability issue if they try to squeeze the quitter out. A C corp usually leads to a professional cap structure where founders are forced to think through these issues a little better.
      - nodesocket 10y ago
        I have a California LLC (sole prop) which is a disregarded entity for tax purposes. LLC is perfect if: a) you don't plan on raising investor capital b) are a single founder, who just wants liability and corporate benefits and protections c) want to easily pass money from the business to personal Do be aware there is a flat $800 a year California LLC fee even if you don't make a cent (which is unfair and anti-small business), but is what it is.
        enraged_camel 10y ago
        FYI the $800 fee is forfeited during the LLC's first year of operation. BUT it's based on calendar year IIRC, so if you're penny-pinching, it may be worth waiting until January to file the paperwork. That way you get all 12 months' worth!
      - fiatjaf 10y ago
        So it seems Stripe Atlas was set with highly-funded startups in mind. Exactly the kind of startup that is not actually in need of Stripe Atlas.
    - switz 10y ago
      I'd just like to echo the sentiment that it would be fantastic if Atlas supported LLCs. Hope it comes around soon!
    - joshdotsmith 10y ago
      Does this mean you're also hoping to expand into Delaware PBCs, too? Lots of open source projects are considering this approach due to a combination of poor response to open source nonprofits from the IRS and flexibility in figuring out their funding sources. There's only trivial differences to a C Corp in terms of filing. I'd been planning to reach out to Stripe about this when it made sense; I probably should've just emailed you! We're advising folks we're bringing onto our Stripe Connect platform as managed accounts to go use Stripe Atlas where possible, but plenty have voiced support for having B Corps be part of that happy path. Honestly, I might even just pay a lawyer at some point to open up some standardized set of docs for this. Do you hope to have any way for Connect platforms with managed accounts to more directly refer people into Atlas? Having an API for the application process would be amazing.
      - ihinsdale 10y ago
        +1 for Stripe Atlas support for Delaware PBCs
      - billdybas 10y ago
        I would also like to see Atlas expand to include B Corps.
- RikNieu 10y ago
  Do you have some sort of guide or FAQ which can give potential clients a guide as to the possible extra costs involved for internationals, like typical accountants and lawyers fees? I've been interested in Atlas in the past, but the potential financial unknowns can be... intimidating. For instance, how would this compare to opening a company in Hong Kong?
  - patio11 10y ago
    The TCO of a company depends heavily on your situation, which is one reason we find it difficult to have an official answer on that. As a single data point, my personal tax situation involved US LLCs last year, as an American living in Japan. I spent about ~$10k on accountants to file taxes in both countries plus bookkeeping services. That's towards the high end among my friends; that's nowhere near the high end for "total amount spent on accountants in a year." For comparison, Atlas would have introduced me to an accounting firm offering the US side of that for ~20% of what I ended up spending on it. (This is difficult to do an apples-to-apples comparison even in this case, because C Corp vs LLC, but trust me when I say "I was pleasantly surprised where we got the numbers to.") We're working on having an even better offering here for next year. We'll have more to say that closer to tax season 2017.
  - soloadventurer 10y ago
    Where are you from? Have you answered the following questions? a) What is my foreign affiliate reporting requirements? For a Canadian, you must file a T1134 annually. The T1134 for a controlled foreign affiliate (where you exercise control) is very onerous. It is not that bad for a non-controlled foreign affiliate. b) What is my foreign affiliate taxation requirements, in that foreign jurisdiction? This is an answer that must come from Atlas I guess. But for a foreigner owning a US LLC, where the US LLC will be controlled from a country with which the US has a tax treaty, we get into many complexities. c) Will I have an income pickup from active business income from owning a foreign affiliate? For Canada, this is a "no." d) Will I have an income pickup from passive income earned in a foreign affiliate? For Canada, this is a "yes." Canadians should never earn rental income, royalty income, or other such passive income in a US LLC, for example. e) How will I deal with the "place of central management and control?" Many countries deem a corporation to be resident in that country if you habitually exercise management and control from that country. For example, a Canadian that owns a US LLC will result in the following: - US LLC is a tax resident of the US by virtue of incorporation, and must file a tax return to report earnings from the USA (no flow through). As the LLC will be a resident of Canada as well (see below), branch profits tax of 30% may apply (IRS 884). - US LLC is a tax resident of Canada by virtue of being controlled, "mind and management," from Canada by a Canadian, and must therefore file a Canadian corporate tax return. The situation is different for Canadians owning "C" corporations. However, it brings its own complexities and nuances. The reporting requirements are challenging. For those seeking to own a foreign company, research your own reporting and disclosure requirements carefully.
- randomdrake 10y ago
  Hello Patrick, thanks for answering questions. From the looks of these most recent updates, and reading over this blog post, it seems as though Atlas is positioning itself to be an accelerator in its own right. Offering connections, assistance, setup help, guidance, and even access to investors. It seems like Atlas/Stripe is only missing a funding portion and perhaps access to a highly covered "demo day." Are those in the pipeline as well? If not, can you elaborate on what the end goal is here besides simply altruism? Is it just to get new companies in the Stripe pipeline faster?
  - patio11 10y ago
    Stripe's goal is to increase the GDP of the Internet. We're doing Atlas because we think it is instrumentally useful to achieving that. This isn't purely altruistic; we're increasing the GDP of the Internet both because it is a good thing to do and because we intend to capture a sliver of the value unlocked during this economic transformation. In terms of what we'll build into Atlas: absolutely anything that is needed by ambitious technically-oriented companies, with a particular focus on things that we feel we have a comparative advantage in shipping. Sometimes we'll be building things ourselves, sometimes we'll be partnering with folks who have part of the puzzle already.
    - good_vibes 10y ago
      I appreciate how honest your reply was and how pure Atlas is in spirit. I am grateful I am part of the Beta because my personal GDP is too low to afford all the services provided by Atlas. Cheers mate!
- boundlessdreamz 10y ago
  Do you plan to offer incorporation in other business friendly countries - say singapore?
  - ovi256 10y ago
    That would be very interesting because it would remove all risk for the founders of being considered "US persons", which has unexpected and unpleasant consequences such as not being accepted as a client by many non-US banks or financial services. It is not clear to me at the moment if incorporating currently through Atlas makes a foreign, non-US resident founder into a US person, or not.
  - soloadventurer 10y ago
    Have you considered http://startupr.com http://startupr.com? I am not affiliated with them, but are using them currently and they are providing great service.
    - wut42 10y ago
      Startupr looks nice but it doesn't seem to come with a bank account. Last time I've heard it's hard to get a bank account for a company abroad.
      - soloadventurer 10y ago
        KYC rules require you appear in front of the bank officer to open a bank account. If you are going to spend money on opening a company, and are prepared to pay the annual maintenance costs going along with financial statements, tax returns, and other reporting, you should be prepared to travel somewhere and open a bank account. Running a company is NOT cheap.
        wut42 10y ago
        I know that, yes. But it seems that Atlas somehow don't require you to travel to the US for KYC.
- lettergram 10y ago
  I setup my company through Atlas, and overall I really liked the process. My only pain point was, "why silicon valley bank"? They have high fees, is a pain to set up and manage, and it's basically the opposite of what I think of as a good experience. As some people said in another comment thread, Capital One Spark is great. I'm actually going to switch to them as soon as I have time. I do work for Capital One in my day job (for now), so if you want / need a contact I can provide one. I do realize they don't support foreign teams, but honestly anything is better than SVB.
- taysic 10y ago
  I really love what Atlas is doing, but I too would love to see a LLC option because I never intend on raising capital. My two cents.
- henrikschroder 10y ago
  We're happy Stripe customers, but our Stripe account is based in an EU country, and our entire volume is in USD. For some Stripe policy reason, we can't transfer USD from Stripe to our EU bank account, it's not allowed. You can only transfer USD to US or Canadian bank accounts. We've been in contact with Stripe support over this, and their recommended solution was to use Atlas and setup a US company and bank account, but that's the wrong solution for us. We already have a company which we're happy about, we don't want to become a multi-national entity with all the liability that follows. So, question: Are you actively going to push Atlas as the solution to our problem as well? It seems completely misguided to me, we just want to be able to transfer the USD held in our Stripe account to our EU-based USD bank account, and not do any currency conversions at all.
  - user5994461 10y ago
    You should try Adyen https://www.adyen.com/ https://www.adyen.com/ It's an European company and it's the main competitor to Stripe on our continent. They are actually a bit older and ten times bigger than Stripe, however they don't advertise much. Disclaimer: I am NOT affiliated with any of these providers.
    - no1youknowz 10y ago
      Adyen does not work with startups. I contacted their sales and they slammed the door shut immediately. They were actually quite rude and the tone was like an automated email. Their wording was they only wanted to work with LARGE companies which already processed LARGE volumes. Unless someone from Adyen wants to clarify?
      - cmdkeen 10y ago
        Their pricing page says: "The minimum charge is 1,000 transactions a month, so the transaction cost will be at least €100 a month." Doesn't look startup friendly at all.
        no1youknowz 10y ago
watsonc73 10y ago
I'm a fan of Stripe generally and loved the concept of Atlas when I first heard about it. I'd be slightly concerned about the commitment bias that might creep in though for startups who rely on Atlas for all their incorporation and financial needs. As a future gatekeeper for some pretty crucial operational issues, do you see any risk in Stripe eventually becoming a dependency for startups? I'd compare it slightly to the App Store where Apple made it simpler for developers to submit, launch and market their apps. As the gatekeeper they then kept increasing their portion of in-app charges. Reduced friction at the start for developers resulted in a sort of sunk cost problem at a later stage. As Da Vinci said "it's easier to resist at the beginning then it is at the end".
- jl17 10y ago
  Using Stripe is completely optional AFAIK.
- patio11 10y ago
  We incorporate real companies for real businesses. If one ever wants to e.g. get legal advice from a professional other than ones Atlas recommends, we’re more than happy for our companies to do that. (Many of them do, already.) We see ourselves more as a builder of doors than a keeper of gates. There is a formidable wall of operational nonsense which separates entrepreneurs from building things and selling them to people. We want to get them through that as quickly as possible, rather than creating additional hurdles. For similar reasons, Atlas is more than happy to help folks take payments with Stripe, but that’s not required or exclusive in any way. If your company thinks Paypal or Apple is a better way to get money from your customers, awesome; your company is no less able to transact with them than any other company. (We literally help people on our forums get set up with DUNS numbers to get on the App Store, for example.)
  - watsonc73 10y ago
    Got it, thanks for clarifying Patrick. That sounds like a fairly clear ethical line in the sand so kudos for taking that position. Good luck with the US launch :)
blowski 10y ago
OT - the Atlas website kills my 1 year old Macbook Pro.
- madlynormal 10y ago
  Works on my 2013 MacBook Pro. Downgrade needed?
  - blowski 10y ago
    It works, it just uses a heck of a lot of CPU. Using Chrome in El Capitan if that makes a difference.
- fiatjaf 10y ago
  Works on my 6 year old Celeron.
chejazi 10y ago
I apologize for the begging, but if anyone has an invite, I would love to use Stripe Atlas with my co! chejazi@umich.edu
- nebabyte 10y ago
  Why would anyone invite you without knowing what they're recommending? For that matter, it sounds like the founder or someone who works there is in this thread, but even if you were going to appeal to them, the information you could give them would likely just be the same information that the (linked in the post) signup/product pitch page's application form would ask for. And fundamentally, why would someone want to work with someone who wasn't proactive in figuring this out? I'm sure as Atlas grows they'll be happy to take your money regardless, but right now they obviously wish to filter out the noise as they likely have a vested interest in starting with the most success-oriented founders. I can't imagine someone who didn't take the 2 minutes to figure out that they have a non-invite-requiring route, and that that's likely because they don't want to shut the door on anons like yourself asking for an in but don't want their existing members having to recommend people they don't know.
  - chejazi 10y ago
    Thanks, but: 1) If the HN community is so noisy then why are you here? :P 2) I deliberately used my university email address to create trust, and if someone wanted to do due diligence I use the same handle everywhere else. 3) I've been following this project for longer than 2 minutes and applied previously.
  - piratebroadcast 10y ago
    You sound like a fucking jackass.
- ploggingdev 10y ago
  Contact patio11 directly by email (it's in his HN bio) and ask for an invite. I remember him making an open offer to all HNers who don't have an Atlas invite but need one.
delibaltas 10y ago
As a foreigner that used Atlas to incorporate my consulting business, I can certainly vouch for it. It is an excellent example of "one stop shop" philosophy.
- markdown 10y ago
  They let you incorporate a consulting business? Are you in a niche field? All their marketing has led me to believe they exist to support businesses like typical techcrunch-worthy SV startups, just based elsewhere.
  - delibaltas 9y ago
    Yes they did. For what it worths I had established clientele and cashflow.
preetish 10y ago
Appreciate your response, Patrick. Quick question - is it necessary for a start-up to have payment side to apply for the program? What about a start-up that is pre-revenue?
- patio11 10y ago
  We have many companies that are pre-revenue before they incorporate. We'll ask for some detail on what the general plan is for making money, so that we (and our banking partner) know, but we don't quite need the same level of detail that e.g. an investor would need.
- fiatjaf 10y ago
  I've got an invite with just a one-paragraph description of my business and a landing page. But later I started to think that if don't know yet if I will be able to turn a profit from this business then I shouldn't commit myself to incorporating a business in US. To be frank, I was under the illusion that Stripe Atlas would facilitate things much more than they do. There's too much bureaucracy to be faced even after Atlas.
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fiatjaf 10y ago
As a foreign developer with a small startup I'm pretty lost with the guides Atlas provides. Is it actually possible to run an Atlas company without ever going to the US and without hiring an US accountant (or PwC, as recommended by Atlas somewhere)? Also, nowhere in the FAQ it is mentioned if it is possible to close the company and how would that work. The SVB terms are also scary to me: "SVB will share more details on its pricing once you have an account". What? What if they're charging me a million dollars? I'll only know after the fact?
- rodionos 10y ago
  Long time SVB customer here. Their international wire is rather expensive. I think they charge $40 per wire, then they deduct $20 from the amount to cover their own correspondent banking fees so you have to always keep the $20 in mind which is painful. On top of that - monthly analysis fees. So... you raised a good question. Make sure you get answers from the program managers.
  - pbarnes_1 10y ago
    Their rates are also bad. Use USForex instead.
nodesocket 10y ago
Silicon Valley bank is frankly awful. I used them for three years but just recently switched over to Capital One Spark Business Checking[1] and love it. Spark is all online, has zero fees unlike SVB (I used to pay $15/mo), and has solid technology again unlike SVB. The account gets setup instantly and your debit card and checks arrive about a week after opening. The Spark iOS mobile app is really solid and allows for check deposits. I highly recommend Spark business checking over SVB. [1] - https://www.capitalone.com/small-business-bank/ https://www.capitalone.com/small-business-bank/ EDIT: Also want to mention, I have two software products and was able to create two bank accounts under the same corporate tax id with Spark, which I was unable to do at SVB. This allows me to isolate income and expenses for each product as each has their own Spark checking account number and transactions under a single unified login.
- seanmccann 10y ago
  SVB's biggest value is in more complicated financial products for startups when traditional banks may not want to work with startups. I've worked with SVB in the past for an AR line that almost no bank would have given us. If you just need a checking account, then there are lots of cheaper banks with better UIs.
  - jforman 10y ago
    Agreed. When I needed a letter of credit BofA refused to issue one to a new company, despite us having ample cash to cover our commercial lease. We switched to SVB, they issued one quickly, and we've been happy ever since. Their technology stack may be a little antiquated, but they are very startup-friendly in their policies. They offer lots, especially to well-funded startups, that you just won't find elsewhere.
  - nodesocket 10y ago
    You have to acknowledge a bank named Silicon Valley and having absolutely terrible technology and only recently a mobile app that is not even native is somewhat of an oxymoron. They also nickel and dime fees. While I am sure SVB does assist with loans, investors, legal, most small businesses and startups just need a checking account and going with SVB is a mistake.
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jstoiko 10y ago
If you're looking for a guide/checklist before going through the "The Twelve Tasks of Asterix"[1] involved in setting-up a startup, I found this one particularly helpful: https://github.com/leonar15/startup-checklist https://github.com/leonar15/startup-checklist [1] https://en.wikipedia.org/wiki/The_Twelve_Tasks_of_Asterix https://en.wikipedia.org/wiki/The_Twelve_Tasks_of_Asterix
WordSkill 10y ago
Info I would find useful in deciding to proceed with Atlas: 1. What are the ongoing costs for a company which, worse case scenario, makes little or no money? 2. What are the costs to close such a company, fulfilling the likely tax and regulatory requirements? I do understand that Stripe is not a law firm or an accounting firm, and I have read through the publicly available documentation. Even so, I find myself uneasy about the possible downsides of getting tangled up with the US system. Obviously, if everything goes well nothing will be a real problem: the money coming in can cover all sorts of ridiculous fees, tax demands and ridiculous bank charges. I am sure, however, that many potential owners are, like me, more focused upon the possibility that they might find themselves in a financial and paperwork blizzard that will drag on for years. I am grateful that Atlas makes it easy to jump in, but how difficult will it be to jump out if necessary? Related: I get that making the entire Atlas Forum members-only adds to the perceived value of membership, but it is frustrating for potential applicants who are hungry to hear about the experiences of others. Having just one open section would almost certainly encourage more people to go ahead and sign up.
kyssetoremotd 10y ago
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davenull 10y ago
How does the AWS credit work? This, for me, is the biggest selling point of the whole shabang.
- zupreme 10y ago
  They probably use the AWS Activate program (which my main startup is part of). It basically gives you a set amount of "credit" with AWS. We got ours almost a year ago and it just ran out this month. It allowed us to run key workloads on AWS for a year at zero out of pocket cost. Of course Amazon does this, in part, because once you have built a functional business on their platform(s) you are more likely to stay there and to continue paying them long-term.
- manigandham 10y ago
  Part of AWS Activate. You can get it through various VC's, accelerators, programs like Atlas, or applying directly. Usually somewhere between $5-25k of credits that will be applied to your bills automatically until they run out. Azure and GCP both also have similar programs (and both also have very high end packages that are $100k+).
thetli8 10y ago
We incorporated using Stripe Atlas during the beta. If anyone has any questions, feel free to ask. Would be happy to provide another perspective on incorporation.
- markdown 10y ago
  1. Do you sell a product or a service? 2. What part of the world are you in (Europe/Asia/Oceania/South America/etc)? 3. Were you already a functioning business with revenue already flowing in?
  - thetli8 10y ago
    1. Yes, we sell a back-house automation subscription service for restaurants. 2. From the US! Grateful to have been able to be a part of the beta, even in the US. 3. Nope. You don't need to be generating revenue to work with Stripe Atlas. Companies decide, on their own, when they need to incorporate.
    - markdown 10y ago
      Thank you, that's helpful.
- lkki 10y ago
  Do you need to set up a business at your home country too?
  - thetli8 10y ago
    Hey lkki, I'm based in the US and we got access to the beta!
danellis 10y ago
One of the benefits of Atlas is the AWS credit, which has been useful for us. We would have much preferred to be on Google's cloud, though, and Google's startup program offers a lot more credit. Is there any plan for Atlas companies to become eligible for that?
markfer 10y ago
Does anybody have an invite code they wouldn't mind sharing for Atlas?
- joshmn 10y ago
  Seconded. Launching in 41 days, this couldn't have been more timely.
- ploggingdev 10y ago
  [Reposting my comment] Contact patio11 directly by email (it's in his HN bio) and ask for an invite. I remember him making an open offer to all HNers who don't have an Atlas invite but need one.
coupdejarnac 10y ago
Is there a roadmap for Stripe supporting more countries? I'm working on an on-demand/marketplace app where buyers and vendors could be anywhere, particularly the Middle East at the outset. The alternatives, Paypal and Payoneer, don't really look too appealing.
markdown 10y ago
Only one of the showcased customers sells physical products, and even then they appear to be a retailer of third party products. I wonder whether they'd accept a startup trying to manufacture and sell a physical (botanical) product from the other side of the world.
npx 10y ago
Is it possible to start an S corporation instead? Part of the appeal of Delaware is that transitioning from S->C is a well defined process, and a C corp seems a bit silly for many businesses.
samuraibunny 10y ago
Smart business idea! Help startups succeed, and in turn, they'll generate revenue for Stripe.
themihai 10y ago
>>>Tell us about what you’re working on and we’ll get back to you within two weeks. How is this better than a traditional bank?

251 points by lebek 10y ago

We've technically speaking got a lot of US startups on Atlas, but we're happy to have more. Today's announcement also includes a number of other improvements we've made the last few months. I'm happy to answer questions if anyone has them.

mixmastamyk 10y ago
When might the LLC track be ready? I'm looking forward to that. Thanks.
- patio11 10y ago
  We ship first and then announce dates because down the other path lies disaster, but LLCs are a great way to incorporate many tech businesses, and Atlas aims to incorporate most tech businesses.
  - rubiquity 10y ago
    No offense but outside of our little HN/YC bubble I think it's the other way around. LLCs seem far more common than Delaware based C Corps for tech companies. For tech startups looking to raise venture capital (a subset of tech companies) a Delaware C Corp is far more common though.
    - valuearb 10y ago
      Aren't LLC's problematic for offering employee equity options? I've done lots of startups, and you want a structure that makes it easy to put together employee pools, easy to raise funding with, and easy to sell/merge. LLCs are easy to setup, but if they create lots of problems down the road it's not a structure you want.
      - brianwawok 10y ago
        LLCs are a swim army knife. You can basically do anything, with way less rules and fees. LLCs can totally offer equity. LLC's are easier to sell than a C corp. Plenty of pluses. If you don't want to get VC funded, you should default to LLC.
        valuearb 10y ago
        Of course LLCs can offer employees equity. But it's not simple, and it's not easy. And its not just VC funding, you should be wary of LLCs if you think it's likely you will need any kind of investors, as typically investors prefer not want to deal with partnership K1s. If your startup is intended to be profitable quickly, and plans to distribute those profits to the founders, an LLC offers significant tax advantages. If you want to build a big business, it can offer some significant limitations.
        brianwawok 10y ago
        > And its not just VC funding Sure, I do not know many people getting non-VC funding, but I guess if that exists for you, you can consider it.. > If you want to build a big business, it can offer some significant limitations. Not sure that is really true. There are some HUGE LLCs. Say, Koch or Cargil. https://www.forbes.com/largest-private-companies/list/ https://www.forbes.com/largest-private-companies/list/
        valuearb 10y ago
        Again, LLC is a great fit if you have a profitable business and want profits can be paid as tax efficiently as possible to you and your other founders. You'll never need investors, you'll be able to borrow money because of your great cash flows, etc. And once in a while one grows to the moon while staying private and never go public. But for most startups, you can't know if you'll need to raise funding. And funding isn't just VCs. It's angels. It's friends and family. It's even crowd-funding now that you can crowdfund equity. And maybe you even get the opportunity to go public and want to be the most public market friendly cap structure. I have a friend whose e-commerce startup just broke over $100k per month in revenue. He's an LLC, but he's starting to realize that he doesn't have enough positive cash flow to pay for the equipment needed to lower his product costs, so now he's thinking of finding investors. And he needs a simple, easy to create equity program with vesting for key employees. And since he has no plans to be profitable soon, he's moving to a C corp. A C-Corp is $500. It's not expensive and is the most flexible foundation to build a startup business on. I'm also biased against LLCs because a problem endemic with LLCs which isn't necessary a fault of LLCs is that it's so easy to just start and go. I see founders who never consider vesting as a requirement. Four founders start an LLC and agree to each getting 25% equity split. Then one quits after a month and the remaining three have a big liability issue if they try to squeeze the quitter out. A C corp usually leads to a professional cap structure where founders are forced to think through these issues a little better.
    - nodesocket 10y ago
      I have a California LLC (sole prop) which is a disregarded entity for tax purposes. LLC is perfect if: a) you don't plan on raising investor capital b) are a single founder, who just wants liability and corporate benefits and protections c) want to easily pass money from the business to personal Do be aware there is a flat $800 a year California LLC fee even if you don't make a cent (which is unfair and anti-small business), but is what it is.
      - enraged_camel 10y ago
        FYI the $800 fee is forfeited during the LLC's first year of operation. BUT it's based on calendar year IIRC, so if you're penny-pinching, it may be worth waiting until January to file the paperwork. That way you get all 12 months' worth!
    - fiatjaf 10y ago
      So it seems Stripe Atlas was set with highly-funded startups in mind. Exactly the kind of startup that is not actually in need of Stripe Atlas.
  - switz 10y ago
    I'd just like to echo the sentiment that it would be fantastic if Atlas supported LLCs. Hope it comes around soon!
  - joshdotsmith 10y ago
    Does this mean you're also hoping to expand into Delaware PBCs, too? Lots of open source projects are considering this approach due to a combination of poor response to open source nonprofits from the IRS and flexibility in figuring out their funding sources. There's only trivial differences to a C Corp in terms of filing. I'd been planning to reach out to Stripe about this when it made sense; I probably should've just emailed you! We're advising folks we're bringing onto our Stripe Connect platform as managed accounts to go use Stripe Atlas where possible, but plenty have voiced support for having B Corps be part of that happy path. Honestly, I might even just pay a lawyer at some point to open up some standardized set of docs for this. Do you hope to have any way for Connect platforms with managed accounts to more directly refer people into Atlas? Having an API for the application process would be amazing.
    - ihinsdale 10y ago
      +1 for Stripe Atlas support for Delaware PBCs
    - billdybas 10y ago
      I would also like to see Atlas expand to include B Corps.
RikNieu 10y ago
Do you have some sort of guide or FAQ which can give potential clients a guide as to the possible extra costs involved for internationals, like typical accountants and lawyers fees? I've been interested in Atlas in the past, but the potential financial unknowns can be... intimidating. For instance, how would this compare to opening a company in Hong Kong?
- patio11 10y ago
  The TCO of a company depends heavily on your situation, which is one reason we find it difficult to have an official answer on that. As a single data point, my personal tax situation involved US LLCs last year, as an American living in Japan. I spent about ~$10k on accountants to file taxes in both countries plus bookkeeping services. That's towards the high end among my friends; that's nowhere near the high end for "total amount spent on accountants in a year." For comparison, Atlas would have introduced me to an accounting firm offering the US side of that for ~20% of what I ended up spending on it. (This is difficult to do an apples-to-apples comparison even in this case, because C Corp vs LLC, but trust me when I say "I was pleasantly surprised where we got the numbers to.") We're working on having an even better offering here for next year. We'll have more to say that closer to tax season 2017.
- soloadventurer 10y ago
  Where are you from? Have you answered the following questions? a) What is my foreign affiliate reporting requirements? For a Canadian, you must file a T1134 annually. The T1134 for a controlled foreign affiliate (where you exercise control) is very onerous. It is not that bad for a non-controlled foreign affiliate. b) What is my foreign affiliate taxation requirements, in that foreign jurisdiction? This is an answer that must come from Atlas I guess. But for a foreigner owning a US LLC, where the US LLC will be controlled from a country with which the US has a tax treaty, we get into many complexities. c) Will I have an income pickup from active business income from owning a foreign affiliate? For Canada, this is a "no." d) Will I have an income pickup from passive income earned in a foreign affiliate? For Canada, this is a "yes." Canadians should never earn rental income, royalty income, or other such passive income in a US LLC, for example. e) How will I deal with the "place of central management and control?" Many countries deem a corporation to be resident in that country if you habitually exercise management and control from that country. For example, a Canadian that owns a US LLC will result in the following: - US LLC is a tax resident of the US by virtue of incorporation, and must file a tax return to report earnings from the USA (no flow through). As the LLC will be a resident of Canada as well (see below), branch profits tax of 30% may apply (IRS 884). - US LLC is a tax resident of Canada by virtue of being controlled, "mind and management," from Canada by a Canadian, and must therefore file a Canadian corporate tax return. The situation is different for Canadians owning "C" corporations. However, it brings its own complexities and nuances. The reporting requirements are challenging. For those seeking to own a foreign company, research your own reporting and disclosure requirements carefully.
randomdrake 10y ago
Hello Patrick, thanks for answering questions. From the looks of these most recent updates, and reading over this blog post, it seems as though Atlas is positioning itself to be an accelerator in its own right. Offering connections, assistance, setup help, guidance, and even access to investors. It seems like Atlas/Stripe is only missing a funding portion and perhaps access to a highly covered "demo day." Are those in the pipeline as well? If not, can you elaborate on what the end goal is here besides simply altruism? Is it just to get new companies in the Stripe pipeline faster?
- patio11 10y ago
  Stripe's goal is to increase the GDP of the Internet. We're doing Atlas because we think it is instrumentally useful to achieving that. This isn't purely altruistic; we're increasing the GDP of the Internet both because it is a good thing to do and because we intend to capture a sliver of the value unlocked during this economic transformation. In terms of what we'll build into Atlas: absolutely anything that is needed by ambitious technically-oriented companies, with a particular focus on things that we feel we have a comparative advantage in shipping. Sometimes we'll be building things ourselves, sometimes we'll be partnering with folks who have part of the puzzle already.
  - good_vibes 10y ago
    I appreciate how honest your reply was and how pure Atlas is in spirit. I am grateful I am part of the Beta because my personal GDP is too low to afford all the services provided by Atlas. Cheers mate!
boundlessdreamz 10y ago
Do you plan to offer incorporation in other business friendly countries - say singapore?
- ovi256 10y ago
  That would be very interesting because it would remove all risk for the founders of being considered "US persons", which has unexpected and unpleasant consequences such as not being accepted as a client by many non-US banks or financial services. It is not clear to me at the moment if incorporating currently through Atlas makes a foreign, non-US resident founder into a US person, or not.
- soloadventurer 10y ago
  Have you considered http://startupr.com http://startupr.com? I am not affiliated with them, but are using them currently and they are providing great service.
  - wut42 10y ago
    Startupr looks nice but it doesn't seem to come with a bank account. Last time I've heard it's hard to get a bank account for a company abroad.
    - soloadventurer 10y ago
      KYC rules require you appear in front of the bank officer to open a bank account. If you are going to spend money on opening a company, and are prepared to pay the annual maintenance costs going along with financial statements, tax returns, and other reporting, you should be prepared to travel somewhere and open a bank account. Running a company is NOT cheap.
      - wut42 10y ago
        I know that, yes. But it seems that Atlas somehow don't require you to travel to the US for KYC.
lettergram 10y ago
I setup my company through Atlas, and overall I really liked the process. My only pain point was, "why silicon valley bank"? They have high fees, is a pain to set up and manage, and it's basically the opposite of what I think of as a good experience. As some people said in another comment thread, Capital One Spark is great. I'm actually going to switch to them as soon as I have time. I do work for Capital One in my day job (for now), so if you want / need a contact I can provide one. I do realize they don't support foreign teams, but honestly anything is better than SVB.
taysic 10y ago
I really love what Atlas is doing, but I too would love to see a LLC option because I never intend on raising capital. My two cents.
henrikschroder 10y ago
We're happy Stripe customers, but our Stripe account is based in an EU country, and our entire volume is in USD. For some Stripe policy reason, we can't transfer USD from Stripe to our EU bank account, it's not allowed. You can only transfer USD to US or Canadian bank accounts. We've been in contact with Stripe support over this, and their recommended solution was to use Atlas and setup a US company and bank account, but that's the wrong solution for us. We already have a company which we're happy about, we don't want to become a multi-national entity with all the liability that follows. So, question: Are you actively going to push Atlas as the solution to our problem as well? It seems completely misguided to me, we just want to be able to transfer the USD held in our Stripe account to our EU-based USD bank account, and not do any currency conversions at all.
- user5994461 10y ago
  You should try Adyen https://www.adyen.com/ https://www.adyen.com/ It's an European company and it's the main competitor to Stripe on our continent. They are actually a bit older and ten times bigger than Stripe, however they don't advertise much. Disclaimer: I am NOT affiliated with any of these providers.
  - no1youknowz 10y ago
    Adyen does not work with startups. I contacted their sales and they slammed the door shut immediately. They were actually quite rude and the tone was like an automated email. Their wording was they only wanted to work with LARGE companies which already processed LARGE volumes. Unless someone from Adyen wants to clarify?
    - cmdkeen 10y ago
      Their pricing page says: "The minimum charge is 1,000 transactions a month, so the transaction cost will be at least €100 a month." Doesn't look startup friendly at all.
      - no1youknowz 10y ago

watsonc73 10y ago

I'm a fan of Stripe generally and loved the concept of Atlas when I first heard about it. I'd be slightly concerned about the commitment bias that might creep in though for startups who rely on Atlas for all their incorporation and financial needs. As a future gatekeeper for some pretty crucial operational issues, do you see any risk in Stripe eventually becoming a dependency for startups? I'd compare it slightly to the App Store where Apple made it simpler for developers to submit, launch and market their apps. As the gatekeeper they then kept increasing their portion of in-app charges. Reduced friction at the start for developers resulted in a sort of sunk cost problem at a later stage. As Da Vinci said "it's easier to resist at the beginning then it is at the end".

jl17 10y ago
Using Stripe is completely optional AFAIK.
patio11 10y ago
We incorporate real companies for real businesses. If one ever wants to e.g. get legal advice from a professional other than ones Atlas recommends, we’re more than happy for our companies to do that. (Many of them do, already.) We see ourselves more as a builder of doors than a keeper of gates. There is a formidable wall of operational nonsense which separates entrepreneurs from building things and selling them to people. We want to get them through that as quickly as possible, rather than creating additional hurdles. For similar reasons, Atlas is more than happy to help folks take payments with Stripe, but that’s not required or exclusive in any way. If your company thinks Paypal or Apple is a better way to get money from your customers, awesome; your company is no less able to transact with them than any other company. (We literally help people on our forums get set up with DUNS numbers to get on the App Store, for example.)
- watsonc73 10y ago
  Got it, thanks for clarifying Patrick. That sounds like a fairly clear ethical line in the sand so kudos for taking that position. Good luck with the US launch :)

blowski 10y ago

OT - the Atlas website kills my 1 year old Macbook Pro.

madlynormal 10y ago
Works on my 2013 MacBook Pro. Downgrade needed?
- blowski 10y ago
  It works, it just uses a heck of a lot of CPU. Using Chrome in El Capitan if that makes a difference.
fiatjaf 10y ago
Works on my 6 year old Celeron.

chejazi 10y ago

I apologize for the begging, but if anyone has an invite, I would love to use Stripe Atlas with my co! chejazi@umich.edu

nebabyte 10y ago
Why would anyone invite you without knowing what they're recommending? For that matter, it sounds like the founder or someone who works there is in this thread, but even if you were going to appeal to them, the information you could give them would likely just be the same information that the (linked in the post) signup/product pitch page's application form would ask for. And fundamentally, why would someone want to work with someone who wasn't proactive in figuring this out? I'm sure as Atlas grows they'll be happy to take your money regardless, but right now they obviously wish to filter out the noise as they likely have a vested interest in starting with the most success-oriented founders. I can't imagine someone who didn't take the 2 minutes to figure out that they have a non-invite-requiring route, and that that's likely because they don't want to shut the door on anons like yourself asking for an in but don't want their existing members having to recommend people they don't know.
- chejazi 10y ago
  Thanks, but: 1) If the HN community is so noisy then why are you here? :P 2) I deliberately used my university email address to create trust, and if someone wanted to do due diligence I use the same handle everywhere else. 3) I've been following this project for longer than 2 minutes and applied previously.
- piratebroadcast 10y ago
  You sound like a fucking jackass.
ploggingdev 10y ago
Contact patio11 directly by email (it's in his HN bio) and ask for an invite. I remember him making an open offer to all HNers who don't have an Atlas invite but need one.

delibaltas 10y ago

As a foreigner that used Atlas to incorporate my consulting business, I can certainly vouch for it. It is an excellent example of "one stop shop" philosophy.

markdown 10y ago
They let you incorporate a consulting business? Are you in a niche field? All their marketing has led me to believe they exist to support businesses like typical techcrunch-worthy SV startups, just based elsewhere.
- delibaltas 9y ago
  Yes they did. For what it worths I had established clientele and cashflow.

preetish 10y ago

Appreciate your response, Patrick. Quick question - is it necessary for a start-up to have payment side to apply for the program? What about a start-up that is pre-revenue?

patio11 10y ago
We have many companies that are pre-revenue before they incorporate. We'll ask for some detail on what the general plan is for making money, so that we (and our banking partner) know, but we don't quite need the same level of detail that e.g. an investor would need.
fiatjaf 10y ago
I've got an invite with just a one-paragraph description of my business and a landing page. But later I started to think that if don't know yet if I will be able to turn a profit from this business then I shouldn't commit myself to incorporating a business in US. To be frank, I was under the illusion that Stripe Atlas would facilitate things much more than they do. There's too much bureaucracy to be faced even after Atlas.

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fiatjaf 10y ago

As a foreign developer with a small startup I'm pretty lost with the guides Atlas provides. Is it actually possible to run an Atlas company without ever going to the US and without hiring an US accountant (or PwC, as recommended by Atlas somewhere)? Also, nowhere in the FAQ it is mentioned if it is possible to close the company and how would that work. The SVB terms are also scary to me: "SVB will share more details on its pricing once you have an account". What? What if they're charging me a million dollars? I'll only know after the fact?

rodionos 10y ago
Long time SVB customer here. Their international wire is rather expensive. I think they charge $40 per wire, then they deduct $20 from the amount to cover their own correspondent banking fees so you have to always keep the $20 in mind which is painful. On top of that - monthly analysis fees. So... you raised a good question. Make sure you get answers from the program managers.
- pbarnes_1 10y ago
  Their rates are also bad. Use USForex instead.

nodesocket 10y ago

Silicon Valley bank is frankly awful. I used them for three years but just recently switched over to Capital One Spark Business Checking[1] and love it. Spark is all online, has zero fees unlike SVB (I used to pay $15/mo), and has solid technology again unlike SVB. The account gets setup instantly and your debit card and checks arrive about a week after opening. The Spark iOS mobile app is really solid and allows for check deposits. I highly recommend Spark business checking over SVB. [1] - https://www.capitalone.com/small-business-bank/ https://www.capitalone.com/small-business-bank/ EDIT: Also want to mention, I have two software products and was able to create two bank accounts under the same corporate tax id with Spark, which I was unable to do at SVB. This allows me to isolate income and expenses for each product as each has their own Spark checking account number and transactions under a single unified login.

seanmccann 10y ago
SVB's biggest value is in more complicated financial products for startups when traditional banks may not want to work with startups. I've worked with SVB in the past for an AR line that almost no bank would have given us. If you just need a checking account, then there are lots of cheaper banks with better UIs.
- jforman 10y ago
  Agreed. When I needed a letter of credit BofA refused to issue one to a new company, despite us having ample cash to cover our commercial lease. We switched to SVB, they issued one quickly, and we've been happy ever since. Their technology stack may be a little antiquated, but they are very startup-friendly in their policies. They offer lots, especially to well-funded startups, that you just won't find elsewhere.
- nodesocket 10y ago
  You have to acknowledge a bank named Silicon Valley and having absolutely terrible technology and only recently a mobile app that is not even native is somewhat of an oxymoron. They also nickel and dime fees. While I am sure SVB does assist with loans, investors, legal, most small businesses and startups just need a checking account and going with SVB is a mistake.

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jstoiko 10y ago

If you're looking for a guide/checklist before going through the "The Twelve Tasks of Asterix"[1] involved in setting-up a startup, I found this one particularly helpful: https://github.com/leonar15/startup-checklist https://github.com/leonar15/startup-checklist [1] https://en.wikipedia.org/wiki/The_Twelve_Tasks_of_Asterix https://en.wikipedia.org/wiki/The_Twelve_Tasks_of_Asterix

WordSkill 10y ago

Info I would find useful in deciding to proceed with Atlas: 1. What are the ongoing costs for a company which, worse case scenario, makes little or no money? 2. What are the costs to close such a company, fulfilling the likely tax and regulatory requirements? I do understand that Stripe is not a law firm or an accounting firm, and I have read through the publicly available documentation. Even so, I find myself uneasy about the possible downsides of getting tangled up with the US system. Obviously, if everything goes well nothing will be a real problem: the money coming in can cover all sorts of ridiculous fees, tax demands and ridiculous bank charges. I am sure, however, that many potential owners are, like me, more focused upon the possibility that they might find themselves in a financial and paperwork blizzard that will drag on for years. I am grateful that Atlas makes it easy to jump in, but how difficult will it be to jump out if necessary? Related: I get that making the entire Atlas Forum members-only adds to the perceived value of membership, but it is frustrating for potential applicants who are hungry to hear about the experiences of others. Having just one open section would almost certainly encourage more people to go ahead and sign up.

kyssetoremotd 10y ago

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davenull 10y ago

How does the AWS credit work? This, for me, is the biggest selling point of the whole shabang.

zupreme 10y ago
They probably use the AWS Activate program (which my main startup is part of). It basically gives you a set amount of "credit" with AWS. We got ours almost a year ago and it just ran out this month. It allowed us to run key workloads on AWS for a year at zero out of pocket cost. Of course Amazon does this, in part, because once you have built a functional business on their platform(s) you are more likely to stay there and to continue paying them long-term.
manigandham 10y ago
Part of AWS Activate. You can get it through various VC's, accelerators, programs like Atlas, or applying directly. Usually somewhere between $5-25k of credits that will be applied to your bills automatically until they run out. Azure and GCP both also have similar programs (and both also have very high end packages that are $100k+).

thetli8 10y ago

We incorporated using Stripe Atlas during the beta. If anyone has any questions, feel free to ask. Would be happy to provide another perspective on incorporation.

markdown 10y ago
1. Do you sell a product or a service? 2. What part of the world are you in (Europe/Asia/Oceania/South America/etc)? 3. Were you already a functioning business with revenue already flowing in?
- thetli8 10y ago
  1. Yes, we sell a back-house automation subscription service for restaurants. 2. From the US! Grateful to have been able to be a part of the beta, even in the US. 3. Nope. You don't need to be generating revenue to work with Stripe Atlas. Companies decide, on their own, when they need to incorporate.
  - markdown 10y ago
    Thank you, that's helpful.
lkki 10y ago
Do you need to set up a business at your home country too?
- thetli8 10y ago
  Hey lkki, I'm based in the US and we got access to the beta!

danellis 10y ago

One of the benefits of Atlas is the AWS credit, which has been useful for us. We would have much preferred to be on Google's cloud, though, and Google's startup program offers a lot more credit. Is there any plan for Atlas companies to become eligible for that?

markfer 10y ago

Does anybody have an invite code they wouldn't mind sharing for Atlas?

joshmn 10y ago
Seconded. Launching in 41 days, this couldn't have been more timely.
ploggingdev 10y ago
[Reposting my comment] Contact patio11 directly by email (it's in his HN bio) and ask for an invite. I remember him making an open offer to all HNers who don't have an Atlas invite but need one.

coupdejarnac 10y ago

Is there a roadmap for Stripe supporting more countries? I'm working on an on-demand/marketplace app where buyers and vendors could be anywhere, particularly the Middle East at the outset. The alternatives, Paypal and Payoneer, don't really look too appealing.

markdown 10y ago

Only one of the showcased customers sells physical products, and even then they appear to be a retailer of third party products. I wonder whether they'd accept a startup trying to manufacture and sell a physical (botanical) product from the other side of the world.

npx 10y ago

Is it possible to start an S corporation instead? Part of the appeal of Delaware is that transitioning from S->C is a well defined process, and a C corp seems a bit silly for many businesses.

samuraibunny 10y ago

Smart business idea! Help startups succeed, and in turn, they'll generate revenue for Stripe.

themihai 10y ago

>>>Tell us about what you’re working on and we’ll get back to you within two weeks. How is this better than a traditional bank?