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Comment by hodgesrm

2 years ago

We are US incorporated with staff in 14 countries. We use contracts for non-US staff and recently implemented letsdeel. So it looks good. You do not need a legal entity in most countries and in fact there can be significant disadvantages. The accounting management alone is a nightmare if you do it yourself.

Ps most people set up their own company and we contract with that.

Edit: add ps

6 comments

hodgesrm

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SkyAndSand  2 years ago

Thanks for the feedback. Did you generally encounter any bigger issues with this setup or would you do it again for the next company?

Also, where in the US did you incorporate? Delaware?

  • hodgesrm  2 years ago

    Delaware, though we originally incorporated in the UK and then flipped as a condition of receiving investment. (Thanks Accel people!) The flip was the most complicated thing we've done--accounting, lawyers on both sides to avoid the dreaded taxable event, etc.

    I would absolutely do the same in future. The contract to individual or individual's company is a standard model for remote companies like us that work on open source software. Some of our staff just have email & github access and that's it.

    My email is in my profile. Send me email if you want to discuss. I'm happy to share details directly.

    • SkyAndSand  2 years ago

      Thanks for the offer. Will get in touch later but I think that public replies could hopefully be helpful for others.

      The setup sounds great! I assume that you flipped to a C-Corp? Are most of the founders in the US or are you living abroad? How long did it take to flip the UK LTD? Do you force your contractors to set up companies or is it up to them?

      At least if the contractors are in Germany and are working full-time for you then I think they would get issues with “Scheinselbständigkeit” if they don’t have a company, that’s why I am asking.

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    • __d  2 years ago

      Second this: I worked for years as a contractor for US-based companies from US, DE, and AU. No issues tax-wise -- it's just a service agreement between the two companies/legal entities.

      Similarly, I often had just a Google (email, calendar, docs, etc) and GitHub account. Legal agreements were like 3 pages total (mostly an NDA).

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