Questions

What does a US company need to consider when receiving investment funds from a foreign investor?

We are a US-based tech startup raising our seed round. We may receive an offer from a foreign investment firm (family office). Does their foreign status in any way complicate our fundraise or cap table? Will other investors care, now or in the future?

2answers

If you're structured as a C-corp (which, if you're going to raise venture capital, you should be), then it shouldn't matter. Most VCs have foreign LPs. If you're an S-corp, it can be a problem due to limitations around who can own shares. Also if you're doing government work, it could be a problem. Otherwise, I wouldn't worry about it.


Answered 4 years ago

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