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Founding a company in Germany: €9600, 152 days and I still can't send an invoice

paolino.me

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Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#381

Post by marcosdumay »

coffeebeqn wrote: post #321
Zak wrote: post #274

Earlier quoted context omitted.

> A company that starts with nothing wouldn't be a GmbH (limited liability company), it would be a GoH (company without liability), and there's a good reason why those don't exist... Those do exist in other countries. An LLC in the USA does not generally need to have a certain amount of assets. Such a company is more or less without liability until it has some assets; the worst case for its owners when it comes to a…

> sometimes shit happens and debts go unpaid What’s wild is that this is pre-debt. The banks will have their own risk math for you so it’ll be a completely separate set of hoops before you get to be in debt as a company. Most will not even talk to you if you have 0€ in the business account. I don’t feel like a company with no assets or income can do that much damage to their societies. Also as a small company in the…

> I don’t feel like a company with no assets or income can do that much damage to their societies.

Keep in mind that those companies will almost always own some debit to their employees when they blow up.

IMO, $25k is a ridiculous amount of capital to require from a company before they can operate. But capital requirements are good, and they should be proportional to employment, not company existence.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#382

Post by plagiarist »

wavemode wrote: post #369
coffeebeqn wrote: post #321

Earlier quoted context omitted.

> sometimes shit happens and debts go unpaid What’s wild is that this is pre-debt. The banks will have their own risk math for you so it’ll be a completely separate set of hoops before you get to be in debt as a company. Most will not even talk to you if you have 0€ in the business account. I don’t feel like a company with no assets or income can do that much damage to their societies. Also as a small company in the…

There are ways to go into debt without dealing with banks. Any time you use something and are charged afterwards, it's a debt (which you could fail to pay by being broke by the time the invoice arrives). Common example - rent/lease. Or gas/electricity.

For a new business with $0 the individual running it will be the guarantor on those.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#383

Post by r_lee »

fakedang wrote: post #378
ExpertAdvisor01 wrote: post #272

Earlier quoted context omitted.

What should the US LLC do ? It will end up being treated like a GMBH in Germany (keyword : Typenvergleich ) and you will have to do all the bureaucracy in the us + Germany and end up paying the same taxes

The point I thought was a plus was that you'd be paying German taxes without all the German bureaucracy? Because there's definitely no bureaucracy for a Wyoming LLC except for a couple of IRS forms annually.

from what I know this is very much possible, you can also use tax treaties to transfer taxation to Germany.

e.g. Irish Ltd that is a resident in Germany

you won't have to bother with the naming problems etc. either

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#384

Post by KomoD »

markvdb wrote: post #200
wayneshng wrote: post #159

I founded my Estonian company within 3 days, that includes when the court rejected the name because a similar name already existed. Everything was online.

The real problem becomes substance in Estonia? Residence, local director, office, ...

You only need a contact person and a legal address, which is only €100-200/yr. You don't need a local director, physical office or similar, and you don't need to live there.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#386

Post by notpushkin »

earcar wrote: post #241
Lariscus wrote: post #194

Earlier quoted context omitted.

The authors inability to understand this really makes wonder how much of the rest of their story is essentially self-inflicted.

I have founded a UG and upgraded to a GmbH before. It had got us "more credibility" with our clients, and 12,500EUR less in each other's bank accounts. Thanks for your insults.

Don’t let the insults get to you.

But yeah, obviously, the more capital you pay in, the more “credible” your company looks. The whole concept of limited liability means that if your company capital is X €, the creditors can only get the X € (unless you do something stupid, see https://en.wikipedia.org/wiki/Piercing_the_corporate_veil).

The fact that the minimum capital amount is so high in Germany is bonkers to me.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#387

Post by figassis »

My country, Angola, implemented online incorporation recently. They're very proud of it, but oh boy, do they need to burn it and salt the earth it stands on. It's harder and takes longer to incorporate online than brave the long lines at the government agency. I can incorporate IRL in 1 day. It took 2.5 months to do it online. Ultimately I gave up and told them to cancel the whole thing. And then it got incorporated the next business day. Maybe I'll also post about that experience.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#388

Post by jeroenhd »

ecshafer wrote: post #294
Lariscus wrote: post #194

Earlier quoted context omitted.

The authors inability to understand this really makes wonder how much of the rest of their story is essentially self-inflicted.

The author can surely understand it. And this system is what is keeping Germany and many European countries from propelling their economies forward by reducing market dynamism. Its not a coincidence that China, US and many other countries, which have more dynamic markets and large GDP growth let you set up a company in a day.

Registering a private limited liability company in the Netherlands costs around 400 euros. If you can file all of the taxes and other legally required paperwork yourself, you can be set up in a week or two. You will be a salaried employee of your own company, though, with a minimal salary you will need to rake in.

The combination of "no personal risk whatsoever, minimal funds/risk coverage, maximal profit extraction" doesn't lend itself well to places with basic regulations.

Capital investments in Europe are definitely not as easy to obtain as in the US for various economic, cultural, and historic reasons, which all led to some pretty weird laws here and there, but the extra week it takes to set up a business isn't the cause.

The reason this all took so long and was so expensive is simple. As the author states:

> I wanted real limited liability

They wanted two different companies with different setups to get out of having to save up the funds or find investors while also paying the least amount of tax possible. They set up a two-company system with all the risk in one and all the earnings in the other. It's like one of those tax dodging schemes the multinationals like, except within a single country. That comes with overhead.

Funnily enough, they then end with:

> Which leaves the only real question. Why 25,000 at all? It is my company and my risk.

Weird to think it would be their own risk if they spend so much time, money, and effort setting up a system that explicitly removes all the risk from them.

All of this feels like it was based on a business plan generated by some over-eager AI that tried to optimize to tick as many boxes as possible, ignoring the real-world consequences of those choices.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#389

Post by echoangle »

NooneAtAll3 wrote: post #347
onli wrote: post #341

Earlier quoted context omitted.

But you can't. It's not like you can bribe the bureaucrat working on your form, and there is no regular fast pass.

> It's not like you can bribe the bureaucrat working on your form are you trying to say "bureaucrat can't speed up" or are you doubting someone physically can't give someone else some cash?

The third option is “they could speed up but won’t do it for a bribe”.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#390

Post by bloppe »

_fat_santa wrote: post #276
WarmWash wrote: post #224

Earlier quoted context omitted.

They are jealous of the US system where you can create an LLC in one hour for $200, and by the next day be doing business with all your personal assets isolated.

The US system is built to support entrepreneurship while the EU system broadly is to support the consumer and employee. The US will never be able to match the EU's consumer and employee protections and the EU will never be able to match the US's ease of doing business, because to have one you have to fundamentally give in on the other. Depending on who you ask, one system is wildly better than the other, but at the e…

In a healthy market economy, entrepreneurs are meant to support the consumer, and they do so partly by competing with one another for talent, which requires supporting the employee. We could argue ad nauseam about the health of the US's market economy, but ultimately is has resulted in unignorably higher wages than in Europe, even at the lower end of the economic ladder.

This probably also has a lot to do with it's much tighter market integration than the EU, although they seem to be finally addressing that issue with the 28th regime.

A popular theory of Europe's historic economic outperformance relative to the rest of the world, leading up to the industrial revolution, relies on competitive market theory: constant warfare spurring innovation, as well as relatively free movement of the best and brightest to seek greener pastures elsewhere on the continent. These days, the most ambitious Europeans tend to move to America to raise money and find talent, and it seems many EU countries are finally waking up to the fact that they need to do better to support entrepreneurship.

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