Start-up Corner I Have a Company That Was Formed in Another Country, but I Want to Set Up a Delaware C Corporation for Vc Investors. How Do I Process and Structure Something Like That?

• Publication year: 2024
• Citation: Vol. 7 No. 2

[Page 159]

Christopher C. McKinnon, Jim Ryan, and Scott Perlov ^*

In this column, the authors discuss how to efficiently flip from a non-U.S. company to a U.S. company, with a Delaware corporation as the new parent.

Emerging companies formed outside the United States may want to redomicile their businesses to the United States to, among other things, enhance their fundraising prospects. U.S. venture capital investors often require non-U.S. companies to flip into Delaware corporations as a condition to investment. Given that custom and preference, non-U.S. start-ups may choose to redomicile to the United States in advance to well position themselves to receive U.S. venture capital quickly, eliminating potential setbacks or preconditions during the investment process.

This column focuses on how to efficiently flip from a non-U.S. company to a U.S. company, with a Delaware corporation as the new parent.

Steps

An efficient way to flip from a non-U.S. to a U.S. company is to do a share-for-share exchange, where shares of the original non-U.S. company are given up in exchange for shares of a new...