Connect with us

Startups: go local first, or head offshore? [Opinion]

If you’re an entrepreneur looking to open a business in a post-Covid world, do you launch your business in South Africa first and then expand abroad, or create an offshore operation immediately?…

Published

on

If you’re an entrepreneur looking to open a business in a post-Covid world, do you launch your business in South Africa first and then expand abroad, or create an offshore operation immediately?

That’s the dilemma facing a growing number of local entrepreneurs – and there are pros and cons for both.

Ralph Wichtmann, Sovereign Trust consultant says much depends on the company’s target market, and where the intellectual property (IP) of the company will be registered. Many start-ups register a South Africa-based company to cater to local clients, and an offshore company to focus on all clients outside the country.

Wichtmann says the number of clients looking to set up offshore operations in jurisdictions like Mauritius, Gibraltar, the Isle of Man, Guernsey, and the United Arab Emirates is increasing as businesspeople look for new markets, to organically create wealth overseas, and even provide future residency and immigration pathways.

“On the one hand, South Africa still has great infrastructure and offers the potential to be one of the highest growth markets in the world. On the other, setting up an offshore company facilitates ease of trade, with the ability to pay suppliers and receive funds in foreign currency without having to go through Reserve Bank approval every time. It all depends on your objectives,” says Wichtmann.

Launching a business in South Africa first

Pros

  • South Africa has good legal, financial, and banking infrastructure, with a vibrant start-up community, including the likes of Snapscan, Luno, Pineapple, Ozow, Ukheshe, Yoco, and Sweepsouth.
  • There is an increasing amount of venture capital available from large investors such as Naspers’ venture capital arm, Naspers Foundry, and the SA Reserve Bank’s Global Fintech Hackcelerator @Southern Africa competition.
  • South Africa has a well-developed intellectual property (IP) infrastructure that protects start-ups and small businesses.

Cons

  • SA-based businesses are subject to SA’s tax system and exchange control regulations, which can be stringent, especially for start-ups. Corporate taxes on profits in SA are 28%, the dividend withholding tax is 20% and the capital gains tax is 22.4%.
  • Foreign investment, via a loan or share capital, would require Reserve Bank approval, as would the sale of IP to an offshore company. This can be a tedious and expensive process.

“A possible solution for SA-based start-ups is to create an SA Headquarter Company, which benefits from relaxed exchange control regulations and reduced taxation. However, this has specific requirements that must be met around equity shares, voting rights, and how the costs of the assets are attributed,” says Wichtmann.

Many local companies provide professional services under instruction from an offshore company. In these cases, it is clear that the instruction and design requirements came from the offshore company which owns the IP. Thus, the local company is merely a professional services provider.

Launching a business abroad from the onset

Pros

  • Depending on the jurisdiction, there are various benefits from reduced taxes and no exchange control regulations. The lack of exchange control and double taxation agreements with the offshore jurisdiction could make the start-up more attractive for foreign investment.
  • Many jurisdictions also have well-developed legal, financial, and banking infrastructure.

Cons

  • When choosing an offshore jurisdiction, one must ensure that any IP is created within that jurisdiction. If IP is considered to be created in SA, this can result in it being considered as a South African IP and would require Reserve Bank approval to sell it to a foreign company.

“Before companies choose an offshore jurisdiction, it’s important to have a comprehensive list of double taxation agreements with the countries to which they will license their IP, as they will benefit from reduced withholding taxes payable by clients to whom the IP is licensed. But ultimately, it’s vital that proper structuring advice is obtained prior to any company incorporation, IP being created or any structuring started,” says Wichtmann.

This article has been written by Ralph Wichtmann, Sovereign Trust consultant.

Featured image: Ralph Wichtmann, Sovereign Trust consultant (Supplied)

Source: https://ventureburn.com/2020/12/startups-go-local-first-or-head-offshore-opinion/

startups:-go-local-first,-or-head-offshore?-[opinion]

Reuters

Eco-friendly sneaker maker Allbirds aims for $2 bln valuation in U.S. IPO

Eco-friendly sneaker maker Allbirds Inc said on Monday it aims to be valued at over $2 billion in its New York IPO, joining a growing number of firms tapping into surging consumer demand and investor interest for such products.

Published

on

A sign on the entrance to the Allbirds flagship store is seen in Manhattan, New York City, U.S., September 7, 2021. REUTERS/Shannon Stapleton

Oct 25 (Reuters) – Eco-friendly sneaker maker Allbirds Inc said on Monday it aims to be valued at over $2 billion in its New York IPO, joining a growing number of firms tapping into surging consumer demand and investor interest for such products.

The company, backed by asset manager Franklin Templeton, said it is offering 19.2 million shares priced between $12 and $14 each, along with the selling stockholders. At the top end of that range, the IPO would fetch about $269 million.

As global calls grow to limit global warming and switch to more environmentally friendly ways of living, several companies have come under investor and activist pressure to contribute to the change.

Among a handful of startups that recently tapped into investor interest in such sustainable offerings were Oprah Winfrey-backed vegan milk maker Oatly Group AB (OTLY.O) and Jessica Alba’s consumer goods company Honest Co (HNST.O). read more

Founded in 2015, Allbirds is also backed by Oscar-winning actor Leonardo DiCaprio and uses wool, fiber derived from eucalyptus and other plant-based alternatives in its products. It has partnered with Adidas to create a range of sustainable sneakers, some of which have become immensely popular across Silicon Valley where the company is headquartered.

Numerous celebrities, top business executives and high-profile personalities such as Barack Obama, Ashton Kutcher and Google co-founder Larry Page have been spotted wearing Allbirds sneakers in recent years.

Allbirds, however, toned down some of its environmental references in an amended filing earlier this month. The company, which said in August it would pioneer a framework to conduct the first-ever “sustainable public equity offering”, later removed references to the claim.

In its latest filing, Allbirds said it expects net revenue to grow up to 32% to $62.5 million for the three months ended Sept. 30, due to higher sales at its physical stores.

However, higher expenses are expected to drive up net losses to about $15 million to $18 million in the quarter, from nearly $7 million a year earlier.

Morgan Stanley, J.P. Morgan and BofA Securities are the lead underwriters for the offering.

Reporting by Niket Nishant in Bengaluru; Editing by Ramakrishnan M.

Our Standards: The Thomson Reuters Trust Principles.

Founded in 2015, Allbirds is also backed by Oscar-winning actor Leonardo DiCaprio and uses wool, fiber derived from eucalyptus and other plant-based alternatives in its products. It has partnered with Adidas to create a range of sustainable sneakers, some of which have become immensely popular across Silicon Valley where the company is headquartered.

Source: https://www.reuters.com/business/retail-consumer/footwear-maker-allbirds-targets-over-2-bln-valuation-us-ipo-2021-10-25/

eco-friendly-sneaker-maker-allbirds-aims-for-$2-bln-valuation-in-u.s.-ipo

Continue Reading

ZDNET

Comcast gave me good, precise news. The truth was precisely the opposite

Many companies believe that technology is perfect for customer service communication. Often, though, it just isn’t.

Published

on

comcast-thumb.jpg

Please be infinitely accurate, Comcast.

These things happen.

Yes, all too often they happen at very awkward times.

But we’ve allowed ourselves to be at the mercy of technology these days, so who are we to complain.

There I was on a recent Friday afternoon, writing several things and watching something on TV. This was my form of dedicated multitasking.

Suddenly, my tasks ground to a halt: All of my Comcast systems went down.

No TV, no internet, no life. (Schopenhauer was the first to say that.)

At least my iPhone was working, so I went to the Xfinity website to see what had happened and when it might unhappen.

The engineers were working on the outage, I was told. Would I like to sign up for texted updates? Of course I would.

Precision Is A Wonderful Thing.

So I sat, waited, and watched.

The first texted offering was that the outage would be fixed by 5:54 p.m. I sat, waited, and remembered I had an Xfinity app on my phone. I tried opening that too, just in case there was more immediate news.

I tried reading a book, but I had those things to do. They were quite urgent, so I became somewhat itchy.

5:53 p.m. came along. It had been more than three hours. But, when you’re told such a precise time, you believe that the texting entity is very sure that the outage is fixable by that time.

At 5:54 p.m. came the bad news. It would be precisely 9:54 p.m. Oh dear. This evening wasn’t going well.

My wife and I cooked. We sat at the dining table, facing each other. We talked. You see, there’s something marvelous about a Comcast outage. It eliminates the temptation of a TV dinner. Instead, you chat about how annoying it is that there’s a Comcast outage.

But I needed to get those things done that night. Because I did. We had plans for the weekend and we wanted to stick to them.

After Midnight. You Can’t Let It All Hang Out.

Next came a new update. The outage wouldn’t be fixed at all that day. Instead, it was now going to be 12:10 a.m. the next day. Precisely.

Please forgive me if, by this stage, I was getting a touch annoyed with this useless precision. Why be so exact when all you’re doing is exacting my nerve ends?

I can appreciate that some things are harder to fix than others. Yet if you’re giving customers such precise information, shouldn’t they expect to trust that information?

And when they discover that the information is precisely useless, won’t you be driving them precisely bonkers?

As the evening began to concede that night was approaching, I kept refreshing my Xfinity app. I feared the next update would say “in three days time, at precisely 3:43 p.m.” I feared I may not even get a text to confirm it, as the texting machines hadn’t been in touch.

Somewhere near 10 p.m., the app refreshed and there was suddenly no mention of an outage.

I tried turning on the TV. It worked. The internet chugged back up. I could do the things I had to do, through yawns of joy.

Curiously, though, I hadn’t received a text to say that everything was working again. Which, lest you forget, was the reason I signed up for the texted updates in the first place.

Of course I could forgive Comcast. It’s compulsory. The company has become somewhat more customer-oriented over the last couple of years. I know it’s been trying.

Oh, but then came Saturday. I could watch Premier League football (saacker) from the very earliest hours. I could watch golf. I could ignore college football.

Good News. Really Good, Imprecise Late News.

Later we went out, sticking to our plans. It was a lovely afternoon. We were in Safeway buying soup and chicken.

Suddenly, a text. Yes, from the Xfinity out there, also known as Comcast.

It began: “Good news.”

I was going to get a rebate for the complete lack of services that lasted seven hours?

Hope is the mansion with non-existent foundations.

Instead, Comcast texted me: “The outage has been resolved at approximately 3:28 p.m. PDT.”

Please imagine the depths of my pained chuckle. Comcast wanted me to know that it had just fixed the outage that it had fixed the previous evening.

So who had I been receiving Comcast services from the previous night and that morning? From the Xfinity Space Station?

And please note the utter deliciousness of the word approximately. Having been so definitive about the time of fixing, now I was only offered an approximation.

The text didn’t stop there, though.

It added: “Thanks for your patience. Your services should be back up and running. Let me know if you’re still experiencing service issues.”

Should be back up and running? But you told me precisely that the outage was resolved.

Naturally, this all caused me to worry.

As with my abject text-based experience with FedEx a couple of weeks before, I fear that companies have no control over the texts they send to customers.

If you’re going to do it, please be accurate. If you’re going to use such technology, make sure it’s not dribbling finger-in-the-air precision that can only frustrate your customers more.

It’s fine to apologize. It’s less fine to offer the wrong information.

If you can’t make the system work, don’t have the system.

Oh, what am I saying? Technology is customer service these days.

Source: https://www.zdnet.com/article/comcast-gave-me-good-precise-news-the-truth-was-precisely-the-opposite/

comcast-gave-me-good,-precise-news.-the-truth-was-precisely-the-opposite

Continue Reading

Bioengineer

Sex differences in COVID-19 outcomes

Credit: Mary Ann Liebert, Inc., publishers In a study of more than 10,600 adult patients hospitalized with COVID-19, women had

Published

on

In a study of more than 10,600 adult patients hospitalized with COVID-19, women had significantly lower odds than men of in-hospital mortality. They also had fewer admissions to the intensive care unit and less need for mechanical ventilation. Women also had significantly lower odds of major adverse events, including acute cardiac injury, acute kidney injury, and venous thromboembolism, according to an article in the peer-reviewed Journal of Women’s Health. Click here to read the article now.

“This comprehensive analysis is the largest study to date that directly assesses the impact of sex on COVID-19 outcomes,” stated Rachel-Maria Brown, MD, Zucker School of Medicine at Hofstra/Northwell, and coauthors. “Our study strongly demonstrates female sex to be associated with lower odds of in-hospital outcomes, major adverse effects and all-cause mortality as compared to male sex after controlling for confounding variables.” The authors propose some of the protective factors that may contribute to these findings.

In the accompanying editorial entitled “Lessons Learned from COVID-19 Sex Disparities,” Annabelle Santos Volgman, MD, Rush University Medical Center, and coauthors, suggest various mechanisms by which female sex may confer a protective advantage against COVID-19 infection. One advantage may be the extra X chromosome, which carries multiple genes responsible for innate and adaptive immunity.

Volgman and coauthors emphasize that “although women have less mortality risk with COVID-19, we need to exercise caution not to send a message to deliver subpar care to women with COVID-19 or decrease measures to prevent their infection. Our evolving knowledge should not reduce attention paid to women admitted for COVID-19.”

###

Research reported in this publication was supported by the National Institutes of Health under Award Number R24AG064191, R01LM012836, R01 NR018443. The content is solely the responsibility of the authors and does not necessarily represent the official views of the National Institutes of Health.

About the Journal

Journal of Women’s Health, published monthly, is a core multidisciplinary journal dedicated to the diseases and conditions that hold greater risk for or are more prevalent among women, as well as diseases that present differently in women. Led by Editor-in-Chief Susan G. Kornstein, MD, Executive Director of the Virginia Commonwealth University Institute for Women’s Health, Richmond, VA, the Journal covers the latest advances and clinical applications of new diagnostic procedures and therapeutic protocols for the prevention and management of women’s healthcare issues. Complete tables of content and a sample issue may be viewed on the Journal of Women’s Health website. Journal of Women’s Health is the official journal of the Society for Women’s Health Research.

About the Publisher

Mary Ann Liebert, Inc., publishers is known for establishing authoritative peer-reviewed journals in many promising areas of science and biomedical research. A complete list of the

Source: https://bioengineer.org/sex-differences-in-covid-19-outcomes/

sex-differences-in-covid-19-outcomes

Continue Reading

Title

Reuters18 hours ago

Eco-friendly sneaker maker Allbirds aims for $2 bln valuation in U.S. IPO

Eco-friendly sneaker maker Allbirds Inc said on Monday it aims to be valued at over $2 billion in its New...

ZDNET2 days ago

Comcast gave me good, precise news. The truth was precisely the opposite

Many companies believe that technology is perfect for customer service communication. Often, though, it just isn't.

Bioengineer5 days ago

Sex differences in COVID-19 outcomes

Credit: Mary Ann Liebert, Inc., publishers In a study of more than 10,600 adult patients hospitalized with COVID-19, women had

Techcrunch6 days ago

Resistant AI scores $16.6M for its anti-fraud fintech tools – TechCrunch

Resistant AI, which uses artificial intelligence to help financial services companies combat fraud and financial crime — selling tools to...

Techcrunch6 days ago

Facebook reportedly plans to change its name to focus on the metaverse – TechCrunch

Facebook is planning to rebrand the company with a new name to focus on building the metaverse, according to a...

Bioengineer1 week ago

UTHSC awarded $1.5 million HRSA grant for sexual assault nurse examiner training

Credit: UTHSC Memphis, Tenn. (June 16, 2021) - The University of Tennessee Health Science Center's College of Nursing has received

Techcrunch1 week ago

Does the NFT craze actually matter? – TechCrunch

Hello friends, and welcome back to Week in Review! Last week, we talked about Apple’s subscription addiction. This week, I’m...

CNBC2 weeks ago

Earnings

Corporate Company Earnings, Find Earnings Per Share and Earnings History Online

ZDNET2 weeks ago

Even computer experts think ending human oversight of AI is a very bad idea

The UK government is thinking of scrapping the right to ask for a human to review decisions made entirely by...

Crunchbase2 weeks ago

The Briefing: Hailo Lands $136M Series C

Crunchbase News' top picks of the news to stay current in the VC and startup world.

Review

    Select language

    Trending