Startup in a 3rd world Country, What are our options?


2

I co-founded a startup that has a product belonging in the social media space and will launch a public beta in two weeks. We are located in the Philippines but we are targeting US/UK users.

I am looking for angel investment and I believe that a US-based angel investor is exponentially better for both sides. The development and running costs are cheaper without any significant penalties in execution. Risk is reduced on both sides. The question is, Is this possible? Did this kind of arrangement happened before?

Foreign Angel Investment

asked Dec 27 '09 at 19:14
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Eric
352 points

5 Answers


2

It looks like you are ready to launch and don't need angel investment right away.

Since your goal is to find an angel from Silicon Valley for instance, at some point you'll need to plan a trip here (read this for details of which meetings to attend to have a productive trip).

But before you book your plane ticket, launch your product and get some initial momentum. That's they key.

Then come to those meetings in Silicon Valley and tell everyone you meet what you have achieved. That will get you in.

PS: don't expect a check on the first visit, your goal should be to create key contacts so that by the second visit, you have a good chance of closing with an angel.

answered Dec 31 '09 at 06:56
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Alain Raynaud
10,927 points
  • this a very good answer but this costs a LOT. perhaps a 2011 action plan. :) – Eric 9 years ago

1

I can't speak for US investors, but many of the North European ones that I have worked with had upfront, clear limitations on which geographic areas they could work in. They typically stated legal risks, and large legal expenses when doing just one deal in a given jurisdiction as the reasons.

answered Dec 31 '09 at 03:49
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Jesper Mortensen
15,292 points

1

I suggest looking in Singapore for potential investors. Lots of international and government money there that is always on the lookout for good foreign investment, especially in developing economies. Ive linked a few entities below for a possible start:

http://www.infocomminvestments.com/ http://www.iesingapore.gov.sg

answered Dec 31 '09 at 16:06
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Joe
277 points
  • Yes, there is also competitions like Startup@Singapore which is open to foreigners (need to check -- probably only those willing to set up in Singapore). However, I would be extra cautious and clear about all the terms beforehand. I would recommend not to take the money simply because it is available, but take the best money. – Phaedrus 9 years ago

1

Unluckily I do not have particular pointers, but I would encourage you to pursue further the direction you have chosen. In general, a US-based investor is more experienced. understands the execution better and has a better economic sense when compared to an Asian investor (However the variance within the US investors may be large too). Some of what I have said about Asian investors has been my personal experience.

I have a feeling that the investors in emerging economies like India and China (if there are) may be a good option too. I guess the big picture is that investors from old-rich countries may be set with old mindsets (unless they belong to a country like US that thrives on innovation).

Another thing: I hope you do not assume that you will get a funding soon after you start pitching. It may take months.

answered Dec 27 '09 at 23:13
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Phaedrus
183 points
  • Yes, i am well aware that it will be a long time when we see our matching investor. I didnt mention other benefits, but add to that connections, better insights to our target market's mindset, etc. – Eric 9 years ago
  • Just found this article about the perils of going with the wrong VC. http://feeds.venturehacks.com/~r/venturehacks/~3/seUZV7B0hDQ/arrogant-vc-2Phaedrus 9 years ago

0

If you are serious about raising money, I think there is some advantage in starting a US corporation and then using that to raise money in the Valley. However it's not the most important step. The first step is to make a service that gains traction, has lots of users etc. At that point investors will be interested and you can overcome the hurdles of being located overseas. Trying to raise money before that point is difficult.

Basically I think it's very difficult to get a US person to invest in a foreign company unless you have proven that your business is on track to success.

answered Dec 11 '10 at 11:20
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Rob
151 points
  • Can non-US persons start a US corporation? That sounds a little expensive especially if there is no founder in the US as a resident or citizen. – Nissan Dookeran 8 years ago
  • Yes a Non-US person can start a corporation very easily. IT takes 5 minutes over the Internet. Getting a bank account is more difficult but fairly easy if you are in the US. I wouldn't say it's expensive? I don't think there is any requirement at all for a founder to be a resident or citizen. – Rob 8 years ago

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