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What would you advise foreigners that want to stablish their start-up in US?

I am advising many start-ups, and some of them consider US as the best market to start with. But this leads to several questions that have to be solved:

1. To what extend angels (and their groups) or VC funds invest in cqase the idea and the level of preparation is good? Will it be different compared to an investment in US established team? In what aspects these considerations will be different?

2. For a foreigner to get business visa / work permit takes time. What is your experience with the process? What are the key factors the US administration takes into account in order to concede the visa? How long does it take? What is the investment amount one should be prepared to spend before the visa is granted?

Any ideas to share or resources they can look at?

11 Replies

Jay Schweid
0
0
Jay Schweid Advisor
Seasoned Entrepreneur | Producer | Executive Producer | Mentor | Advisor | Dad
Hi,
I've worked with a number of friends, colleagues and partners from Europe that came here to start or join a business.
It's not that complicated as long as the business is real and the person/people coming over have the credentials and money to back up what ever business they plan on starting.
I know some people that start the business on their own and others that bring on a US Citizen as part of the company - which can be a benefit to the company on a whole as well as for the Visa process.
Happy to connect you with our immigration attorney, who also is a dear friend, who can guide you through that part of the process.
Thanks!
Jay
Victor Danett
0
1
Victor Danett Entrepreneur
Regional Sales Consultant at TriNet
My firm, TriNet, routinely works with firms that have just obtained their Visa to set up all their HR needs including Payroll, Benefits and Risk & Compliance.
Dejan Nenov (d [at] panaton [dot] com)
3
0
Senior Technology Executive

Hello Todor,

Here is my experience / opinions:

1. Do not come to the US to raise money unless you have a revenue generating firm with at least 3+ REFERENCEABLE clients.

2. If you are doing financial service or marketing automation - East Coast (NYC specifically) is OK, for anything else you want to have an address and a conference room within 5 miles of Palo Alto. As silly and elitist this sounds there is a simple reason for it - people who tend to sit on 5 to 20 boards really like to be able to drive to the companies they invest in (so that they can be home for dinner with their families), rather than have to fly to board meetings.

3. Setting up a firm takes no time at all - BUT always work with an attorney who specializes in startups and corporate transactions - I have worked with the same San Francisco council for 15+ years and she is able to turn around in less than 24 hours most of the routine corporate registration, licensing, etc. transactions.

4. You MUST consult with a tax attorney - depending on which country you live in it makes a difference - specifically you have to decide if you are going to be a C-Corp or an LLC. A Delaware registered C-corp is the default structure for a VC funded / stock-option incentivized tech startup, but there are many different variations - one size does not fit all.

5. Business VISAs are not a problem and I work with (and employ) many people in Europe who have 10-year multiple entry business VISAs (B-1) - these make it possible to spend about 3 months per year working in the US - especially if you are doing fundraising, bizdev, sales, etc. For senior staff the L-1 VISA is the best. The process is routine and is simply a matter of filing paperwork - something we learn to do well if we do business in Europe J Timing can be a matter of weeks, but rarely more than a month or two.

Since 1998 I have helped several colleagues from Eastern Europe, Germany, Norway and the UK setup in the US (and US firms in Romania and Bulgaria :) ) - I would be happy to share my contacts with you - feel free to reach out directly to me via email - d[at]Panaton[dot]com

Best Regards,


Dejan Nenov

Benoit Bergeret (Ben)
1
1
Partner and Executive Advisor at Inovexus
1- Get your founder(s) over here. No way around this.
2- OK to keep engineering / R&D abroad (often preferable, actually).
3- You will have to "paint your company in the US colors": native US marketing, community management, whatever the case may be. Things will be much easier if everything looks, feels and smells American to a US user.
4- Don't underestimate the time and $$ commitment to make it happen: in my experience helping bring multiple companies over from Europe, including my own, you'll need 2 years and $1.5-$3M to commercial traction (unless you are operating a global web platform, in which case location is only relevant for the fundraising). Better make sure your board and investors and 100% behind you.
5- Don't try to raise from US VCs unless you have US traction (sales or adoption depending on what you do)
6- Raising VC money in the US is also a powerful marketing tool. A strong VC brand name in your area will get you exposure (helping with business growth) and brand name recognition (helping to attract tier-1 staff).
7- Hire locals in local roles as much as possible.
My 2 cents.



Patrina Mack
0
0
Patrina Mack Advisor
Experts in global commercialization
Vision & Execution works extensively with international companies wishing to expand to the US. Key themes from a benchmark study we completed about a year ago which still holds true are "localize" your product for the US market. Most companies have a product that works well in their home country but not one that is competitive in the US market without deep segmentation and finding a niche that's underserved to enter the market. It takes longer than you think it will. Funding is possible here in the US without US founders but you will need US market traction to acquire US funding so make sure you're financially resourced through home country options. The key to success was using local (US) resources to help you navigate the US market. Even if you're fluent in English you will miss things that a local won't. You can see the report herehttp://www.slideshare.net/visionandexecution/entering-the-us-survey-resultsv4
Terri Friel
2
0
Terri Friel Advisor
CEO Doctus and Member International Advisory Board of Cracow School of Business CUE at Cracow University of Economics
I work with start ups and get them to funders and investors regularly. Lately the biggest issue is the concern that the business is only a great idea with little execution or understanding of what that might take. They are cautious, more so now than before, because so many entrepreneurs have been nothing more than someone wanting cash who never executes. I'm working as a mentor for some of these companies for investors who want my second pair of eyes on the company but also on the person who's running the company. For international entrepreneurs, I'd say that they would have to rise above a second level of suspicion from investors that they'd just abscond with the cash and be unreachable for consequences of contract breach. Thus if you want to put your companies in front of investors, they should be well versed in the issues, able to answer the financial questions confidently and succinctly and they should be generating some level of revenue on their own with little or no funding (Perhaps from friends and family...i.e. they have skin in the game.) We are not playing shark tank in the real world...these are real people with expectations of return who cannot afford to bet on losers very often. Your owners must be able to demonstrate in several ways they are winners worth backing.
Darnley Howard
0
0
Darnley Howard Advisor
President/Principal Consultant, Advansa International
To answer your first question, if the startup is based in the US, US based VCs will look at it like any other firm in assessing the business model and quality of management.That said, it might be helpful to steer the startup towards accelerators or university based programs which will help your clients build a network and get plugged into the local entrepreneurial community and help them get seen by investors. Darnley DARNLEY W. HOWARD President/Principal Consultant Advansa International 135 Pleasant Street, Suite 32 Arlington, MA 02476-8163 (c) 781/350-0610 www.linkedin.com/in/darnleyhoward/ emergingmktstories.wordpress.com smallbusinessstories.wordpress.com/
Todor Velev
0
0
Todor Velev Entrepreneur
Managing Partner, EEI Network
Thank you for all your comments, they are really helpfull and provide multiple points of view. The founders team is thinking of going to accelerator as a first step in order to establish presence, network and become "local". But accelerator normally invests small amount (to the best of my knowledge) and the aplication procedure might be long. Any suggestions on accelerator to be approached will be highly appreciated. In terms of legal structuring, the plan is to establish C-corp in Nevada. Of course, this is very preliminary plan, and comments are welcome :) PS. The spellchecker of my cellphone sometimes changes the spelling, excuse me for wrong words :) Todor Velev Sent from my mobile
Darnley Howard
0
0
Darnley Howard Advisor
President/Principal Consultant, Advansa International
Mass Challenge in Boston (www.masschallenge.org) is an accelerator that takes no equity. DARNLEY W. HOWARD President/Principal Consultant Advansa International 135 Pleasant Street, Suite 32 Arlington, MA 02476-8163 (c) 781/350-0610 www.linkedin.com/in/darnleyhoward/ emergingmktstories.wordpress.com smallbusinessstories.wordpress.com/
Michael Queralt
0
0
Michael Queralt Entrepreneur
President
Establish the C Corp out of Delaware - Investors are more comfortable with that state. I would second some of the comments- you have to bring local talent that knows the market - it will help shorten the cycle and reduce friction with customers & investors.
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