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I see big problems in taxes and bank accounts. 1. Taxes: So you incorporate on the BVIs or a similar tax heaven, because you don't want to pay taxes. You are
by derda 15y ago
I see big problems in taxes and bank accounts.
1. Taxes:
So you incorporate on the BVIs or a similar tax heaven, because you don't want to pay taxes. You are not even using the infrastructure of a country, so that doesn't even feel morally wrong. But crucial parts of your company lay within the USA (servers, some investors, consultants, bank accounts..). There have been tax cases before (at least in Europe) where it has been argued that a server equals a permanent business establishment and therefore is taxable (I can not find an English language article on the quick but I remember a case where a german hat incorporated in Cyprus and used german servers). So that would be a mess.
2. Bank accounts
Does the country of the boats registration or the country you choose to incorporate have a stable banking system and currency? Can you get a Paypal (or whatever payment provider) account for this bank account? Or will you go for a US bank, which again leads us to (1), also I dont know how hard it is to open a bank account in the US on the name of a foreign company with no entity in the US. What will potential costumers think about bank accounts in county x? What happens if the US tightens rules on money laundry, making your transfers a pain?
Many questions will have to be solved on the way. I really hope the project succeeds, especially if it pushes US law-makers to think about their visas.
- anateus 15y ago1. You don't have to be a citizen to incorporate in the US. Y Combinator requires everyone to incorporate in the US regardless of their home country. It doesn't seem like Blueseed will have a similar requirement, but they should probably advise their startups to do so for the sake of it much easier to get investments. 2. Once you have a US corporation, you can have a US bank account. So while the issues you raise could be problems for some companies, it's actually fairly straightforward and cheap (there are costs to your agents in Delware and a few similar items). edited for style and coherence
- derda 15y agoThe slides said "you choose where to incorporate" (slide 26). I know its pretty easy to incorporate in the US, but AFAIK as soon as you do business with the US (rent servers from US company, have US-bank account) you are subject to the IRS (I don't know what rules apply). Why pay taxes and/or waste resources (tax consultants / lawyers) to a country that didn't want your business in the first place?
- anateus 15y agoBecause the primary point of Blueseed is to allow easy access to investments from Silicon Valley. Getting invested in without a convenient corporate and financial structure. I think the IRS is an acceptable tradeoff based on the vastly greater availability of investment in Silicon Valley vs anywhere else in the world.
- johncoogan 15y agoI too see accounting as a hurdle but think customer validation might suffer as well. "Get off the boat" actually has a nicer ring than "get out of the building" but will obviously be harder. As much as I love hackathons, there are fringe benefits to mixing with normal-folk on occasion. I can't explain how much I've learned from overhearing women explain Pintrest to one-another.
- didgeoridoo 15y agoWhat about bringing customers to the boat? Weekly "demo days" could bring a ferry-full of future customers to the ship, either dedicated to a single startup (for B2B/specialist businesses) or shared between many (for general/consumer ones). The added advantage? People who are willing to head out to the middle of the ocean to try a new product would, I'd think, be archetypical "earlyvangelists".
- mseebach 15y agoThe point of Blueseed isn't tax evasion, it's immigration policy evasion.