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This guy can work for a year and invest his money on the same terms as angel investors. The only technical problem how to do it tax free, b/c you obviously owe
by nivertech 15y ago
This guy can work for a year and invest his money on the same terms as angel investors.
The only technical problem how to do it tax free, b/c you obviously owe income tax and in some countries like Israel also VAT.
There are some solutions, but they are not trivial. The employee actually buys a convertible debt in the company on the similar terms as angel investor and can cash out on later rounds.
- Murkin 15y agoOr he can be a freelancer with his own company, investing from company's funds (no tax) and after the exit pulling the money from the company as dividends and getting to have only one (low) tax event.
- nivertech 15y agoYou can invest company funds, but you will still need to pay Corporate tax on your profits. Not relevant for freelancers without company, b/c they will need to pay taxes+VAT on income.