As more novel digital businesses realize the benefits of doing business in the U.S., global entrepreneurs are flocking to the U.S. to launch their US LLC, DAO LLC, or C Corp.

  • The latest reports have suggested a significant influx of U.S. business formations (on track for 5M+ in 2022 ) as the U.S. has become a more attractive location for global entrepreneurs.
  • The new Doola company formation API is one of the most prominent gateways to help manage the influx of new business formations in the U.S.
  • One of the most significant reasons for this influx of global businesses is to access the lucrative U.S. consumer market and seek the advantages of U.S. funding infrastructure.
  • Every day, foreign national entrepreneurs establish their businesses in the U.S. - typically done through the standard process. But a number of new online services that support customers through the incorporation process are growing.

This article will look at the latest innovative tool launched by Doola, which aims to expedite the process and help manage the influx of U.S. LLC, DAO LLC, and C Corp incorporations.

U.S. Business Formations Are At All-Time Highs

In 2022, over 5M new businesses are projected to be formed in the United States. Some believe 10% up to 25% of these businesses are from Non-US founders looking to launch a U.S. business to accept payments and sell globally in the U.S. dollar while expanding to a lucrative customer market. However, the company formation process, especially for Non-US residents who have to fax forms to the IRS and, until recently, fly to the U.S. to open a bank account, is ​​more complicated and expensive than it should be.

The Allure of American Business Formation

No Need To Be A Resident

Surprisingly, there is no requirement for prospective U.S. business owners to be a resident as well. Moreover, owners from other countries can run their businesses in the U.S. while residing anywhere in the country.

This factor acts as a preamble to the others explored below, as it is what facilitates owners to actually pursue the establishment of their business in the U.S. and capitalize on all the other benefits associated with forming an entity here.

Get a U.S. Business Bank Account without Visiting the U.S.

Previously, you needed to have a U.S. Social Security Number and be a U.S. resident to open a U.S. Bank Account. Times are changing, and doola is leading the charge. With Doola, you can now open a U.S. business bank account without a U.S. Social Security Number, and without living in the U.S. Doola doesn't just help companies set up an entity in the U.S.; they also get them a U.S. business bank account.

"Through doola, global founders can accept payments in $USD and use efficient U.S. payment processors. The goal here is to widen access for all founders regardless of location. We empower anyone to expand their business into one of the most lucrative customer segments globally: the U.S. consumer market," said Arjun Mahadevan, Co-Founder and CEO of Doola.

In addition to seamlessly opening a U.S. company and getting a U.S. bank account, doola takes it one step further and handles all ongoing state + IRS tax compliance. Customers call them a "One-Stop-Shop"; doola believes founders should focus on what they do best (talking to users and building products), while doola handles the rest.

No Necessary Minimum Capital

One of the paramount justifications for establishing a global business as an entity, such as an LLC, in the U.S. is the fact that there is no minimum required amount of capital - which directly contrasts the situation over the pond in Europe. In Denmark, for example, it is required under national business law that LLCs possess $14,000 as a minimum in capital in order to incorporate.

Furthermore, in contrast to E.U. regulations for entrepreneurs looking to incorporate, no such requirement exists in the U.S., resulting in greater ease of entry.

Greater Business Investment

It's generally far easier to raise venture capital in the American economy than anywhere else in the world. Raising from U.S. angel and institutional investors is also very appealing for founders globally.

In addition to all this, consumers spend nearly eight times more in the U.S. startup industry than in other regions, like the E.U. Businesses open themselves up to significant financial upside by establishing themselves as a U.S. entity.

How Non-Residents Can Form a U.S. LLC, DAO LLC, or C Corp

So how exactly can non-residents set up a U.S. company? The traditional (DIY) process, outlined below, is quite long and convoluted, though appealing for those with the time available looking to save money.

The first step involves choosing the business structure the non-resident wishes their business to incorporate as. Several online resources can aid in selecting the optimal structure for your business. However, for most startups, it is widely accepted as advantageous to opt for an LLC due to its pass-through taxation benefits.

Next, a state must be selected for the global business to be based in. There are a myriad of great options, though the best is unique to every business. Those that won't be tied down to one area in particular (i.e., no physical presence anywhere) are recommended to base themselves in Wyoming or Delaware because of its friendly taxation rates and low costs of running a business. Doola's guide shares more on the best state to form your U.S. business in.

When it comes to finally registering the business in the U.S. (and completing all the associated forms required), each state will demand different documents to be filled out. On balance, the requirements will consist of three essential components:

  • That the business's name is unique.

  • That the business appoints a registered agent.

  • That a certification of incorporation is completed.

Finally, the business must apply for an Employer Identification Number from the IRS. An EIN is the corporate equivalent of a social security number and is required for a business to be able to open a bank account in its name.

Suggested Video from Doola:

Is Doola An Easier Way To Incorporate?

This method of incorporation is established, though it can be quite confusing for novices in the area, particularly those who are not familiar with the domestic laws of the U.S. That is why the popularity of services aiming to help global entrepreneurs with the incorporation of their businesses has exploded.

One of these services is Doola. According to the startup's co-founder and CEO, Arjun Mahadevan, Doola wanted to revolutionize this space with a product that would allow users to "click a button and initialize a company."

Doola's service aims to support its clients through the process of their business's formation in the U.S. While it does provide help with all the steps above of incorporating a company (such as securing an EIN, a U.S. bank account and address, tax support, etc.), it is not a mere formation service.

In the words of Mahadevan, it aims to set its customers up to be able to "confidently collect payments, build credibility, stay legal and make more money." Furthermore, their focus on this goal sets them apart from other contenders in the space, as they do not just leave their customers to fend for themselves once their business has been incorporated.

The results of the latest innovation at Doola? It seems that Doola has now succeeded in releasing a faster service when compared to the speeds of LLC formation companies like Zen Business, Incorporation Rocket, LegalZoom, and IncFile. This may be one of the reasons that almost 200 independent reviews on Trustpilot tips it as a favorite tool for starting a new business. Interested parties can learn more at www.doola.com and on Twitter at @doolaHQ.

As one of the main backers of the Doola enterprise said: "... Creators and independent entrepreneurs want to focus on their crafts that they love. However, to build businesses around their crafts, they would also need to take care of unexciting but necessary backend business management functions (like incorporation, compliance, taxes, banking, payments etc.), for which they usually do not have expertise, nor interest, nor the time those activities demand. doola is set to address just that: so solo-preneurs can do what they love and are best at, while doola takes care of the rest. We are thrilled to partner with Arjun, J.P. and team Doola in their journey toward building a remarkable company" Jishnu Bhattacharjee (Managing Director, Nexus Venture Partner)

Closing Remarks

Online services such as Doola provide an easier and more straightforward means for global entrepreneurs to incorporate their business in the U.S. While the traditional DIY method is all well and good, it can leave many non-residents bereft of the knowledge of what to do.

For those looking to set up a U.S. company as a non-resident, Doola's API might soon become the leading gateway to doing business in America.

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