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A startup doesn't need to be a unicorn

mattgiustwilliamson.substack.com

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Re: A startup doesn't need to be a unicorn

#341

Post by shafyy »

nickpsecurity wrote: post #324
shafyy wrote: post #210

Earlier quoted context omitted.

I have founded multiple companies in Germany and in the US. Sure, in the US you have services like Stripe Atlas that make it a bit easier. But still, I would not say it's much crazier registering a company in Germany compared to the US. Of course, it helps if you have a bit of an idea of legal concepts and accounting, but to be honest, that also makes sense, since you are starting a business. This is not to say that…

Here it is in Mississippi: https://www.chamberofcommerce.org/how-to-start-an-llc-in-mis... How does that compare to Germany?

I think the main difference is that you physically need to go to a notary in Germany. But that meeting takes like 10 minutes, it's all boilerplate.

Re: A startup doesn't need to be a unicorn

#342

Post by Propelloni »

nottorp wrote: post #279
Propelloni wrote: post #264

Earlier quoted context omitted.

The barrier to entry is the idea that you need a limited liability corporation to start something digital by the seats of your pants. You can always start as a GbR (virtually no costs, spend a day at your city's administration to get a tax id). I mean this in the most charitable way, what kinds of liabilities are you afraid of in that scenario? Once your idea gets traction and money comes in you hopefully will be abl…

> I mean this in the most charitable way, what kinds of liabilities are you afraid of in that scenario? Why do you think I know all the kinds of companies one can register in Germany? :) I'm not even german or in germany, just keeping myself informed. You never know when it becomes useful. Up until today I only knew of the GmBH. Now I know of two more types.

I've got the impression that you knew a little about German corporations, but I have been wrong before, so my apologies.

I guess, one can assume that all countries with working institutions (and some without) have at least a simple personal liability corporation, which is easy and cheap to establish, and a basic limited liability corporation, which is a little bit more involved and expensive to establish. I guess, because I haven't done any research, but I've come across such corporate forms in Germany, Italy, France, UK, Luxembourg, Hungary, Serbia, Congo, UAE, Estonia, Netherlands, Denmark, Norway, USA, Canada, the Philippines and probably a few more.

Re: A startup doesn't need to be a unicorn

#343

Post by Propelloni »

notpushkin wrote: post #281
Propelloni wrote: post #269

Earlier quoted context omitted.

> Mimimum capital is 1 €, If you are talking about an OÜ this is often repeated and technically wrong (the best kind of wrong). One, actually the minimum capital requirement is 0.01 Euro per shareholder, and two, Estonian courts are pretty clear that in an OÜ with less than 2500 EUR capital the shareholders are personally liable to cover the difference between share capital and 2500 EUR to trustees.

Yeah, you’re technically right (the best kind of right!) — on both counts. However, if I understand everything correctly (IANAL), personal liability is basically the same. If you go for 2500 € capital and your company becomes undercapitalized, you’ll still be personally liable for any claims against your company, no? (But personally, I just like how this opens opportunities even for people for whom 2500 € is a seriou…

Sweet gorilla of Manila! Anyway, I only had to deal with an OÜ once, so take it with a grain of salt. And IANAL, too ;) What I took away is that you are sheltered from claims against the company by economic avtivity, ie. outstanding fullfilment, but you are liable for claims against the company from management misconduct, ie. neglecting tax duties or, worst case, bankruptcy.

Re: A startup doesn't need to be a unicorn

#344

Post by nottorp »

Propelloni wrote: post #342
nottorp wrote: post #279

Earlier quoted context omitted.

> I mean this in the most charitable way, what kinds of liabilities are you afraid of in that scenario? Why do you think I know all the kinds of companies one can register in Germany? :) I'm not even german or in germany, just keeping myself informed. You never know when it becomes useful. Up until today I only knew of the GmBH. Now I know of two more types.

I've got the impression that you knew a little about German corporations, but I have been wrong before, so my apologies. I guess, one can assume that all countries with working institutions (and some without) have at least a simple personal liability corporation, which is easy and cheap to establish, and a basic limited liability corporation, which is a little bit more involved and expensive to establish. I guess, be…

> I've got the impression that you knew a little about German corporations

I did, about the GmBH, from other discussions on HN. As I said, now I know more, thanks.

> have at least a simple personal liability corporation, which is easy and cheap to establish, and a basic limited liability corporation, which is a little bit more involved and expensive to establish

Yes, but in RO where I am the minimum capital for a LLC is like 100 EUR not 25k :)

That's barely enough to pay a cheap accountant for a month ofc.

Re: A startup doesn't need to be a unicorn

#345

Post by AlchemistCamp »

dinoqqq wrote: post #265
pembrook wrote: post #229

Earlier quoted context omitted.

> but I also think hiring someone for [government paperwork] would be the wise choice in most places anyway. I’m not sure if you’ve ever tried founding a business or fundraising in any other non-Germany country, but this is an insane thing to say imo. Is this why Germany has no globally relevant software (or hardware tbh) companies founded in the last 40 years? Are we sure we want to be holding up this model as an ex…

You probably missed SAP then. > The company is the largest non-American software company by revenue and the world's third-largest publicly traded software company by revenue. As of December 2023, SAP is the largest German company by market capitalization. https://en.m.wikipedia.org/wiki/SAP

It was founded over 50 years ago. It had already been running for decades before Amazon, Google or Facebook were even founded.

Re: A startup doesn't need to be a unicorn

#346

Post by gsck »

haileys wrote: post #301
pembrook wrote: post #229

Earlier quoted context omitted.

> but I also think hiring someone for [government paperwork] would be the wise choice in most places anyway. I’m not sure if you’ve ever tried founding a business or fundraising in any other non-Germany country, but this is an insane thing to say imo. Is this why Germany has no globally relevant software (or hardware tbh) companies founded in the last 40 years? Are we sure we want to be holding up this model as an ex…

> Is this why Germany has no globally relevant software (or hardware tbh) companies founded in the last 40 years? Ableton, Native Instruments, SoundCloud, TeamViewer

MA Lighting, by far the largest and most dominant lighting console manufacturer.

They are the industry standard around the world, no one even comes close.

Re: A startup doesn't need to be a unicorn

#347

Post by muzani »

nradov wrote: post #327
amazingamazing wrote: post #43

Earlier quoted context omitted.

> These things do work and created a few unicorns here in Malaysia. Which ones?

Carsome and Aerodyne?

I was thinking Grab, back when they were called MyTeksi. Honestly the reason I don't answer these questions is that it's just so hard to dig up this info. It feels like genealogy, which is fine for curiosity, but I can't tell which of these questions are just being contentious.

Best I can get this this link from 7 years ago: https://vulcanpost.com/624177/malaysia-memorable-startup-fun...

And it was about their investments from ~17 years ago. These things are slow.

Re: A startup doesn't need to be a unicorn

#348

Post by youngtaff »

haileys wrote: post #301
pembrook wrote: post #229

Earlier quoted context omitted.

> but I also think hiring someone for [government paperwork] would be the wise choice in most places anyway. I’m not sure if you’ve ever tried founding a business or fundraising in any other non-Germany country, but this is an insane thing to say imo. Is this why Germany has no globally relevant software (or hardware tbh) companies founded in the last 40 years? Are we sure we want to be holding up this model as an ex…

> Is this why Germany has no globally relevant software (or hardware tbh) companies founded in the last 40 years? Ableton, Native Instruments, SoundCloud, TeamViewer

SAP

Re: A startup doesn't need to be a unicorn

#350

Post by jermaustin1 »

nickpsecurity wrote: post #326
jermaustin1 wrote: post #167

Earlier quoted context omitted.

Is this really true? I'm in the US, and have a corporation in the US. I am shielded from liability through the corporate veil, but I also have a $50/mo $2M/incidence liability umbrella. I honestly have no idea if either are necessary, in 20 years of "doing business" I've never had a single liability needing to be covered by insurance or the veil. I think it's wise to have, just in case, but even in lawsuit happy Amer…

I'll warn you that insurance companies often try not to cover a loss or all of it. They often try to cheat their customers. So, having insurance isnt equal to a structure that makes you personally immune to liability because what the insurance company will do is unknown.

And I'll warn you a limited liability entity doesn't necessarily protect your personal assets either.

Undercapitalization is a big one that people don't often realize - going without insurance an not enough funds to cover a claim will usually pierce the veil.

Same goes with little things that typically don't matter to the owner of a one person company, like failing to keep board/member annual meeting minutes and sending them to the state body that requires them, and the biggest one for most small businesses - commingling funds and "alter ego" doctrine - the company is not you, the company's money is not yours.

There are a lot of ways that limited liabilities vanish - especially for smaller businesses like OP is describing.

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