Launching WFOE Companies in China
The New-Co team and I made a quick trip to Dalian China this month to launch the company in stealth mode. Think killer app for mobile devices / social networks. It's totally new; don't ask because we aren't ready to tell... It's a great new adventure on the frontier of business... Not coincidentally, I picked up Jim Rogers (speculator, author, adventure capitalist) book "A Bull in China" at Relay Books in Hong Kong to keep me company on the long flight.
Paul Kullich (speculator, polo player, entrepreneur), Robin Greenlees (banker, Buddhist, capitalist) and I (space ghost) decided to chase after the biggest potential market and take the intellectual property to China under state and local government assurances it would be protected. The promise of a faster rate of growth, large user population, business incentives, and our seed capital going much further was hard to resist. Back in July Paul and I were the only two technology entrepreneurs (from outside China) present at the China International Software and Services Fair. (which was surprising, and made us the center of much curiosity and attention.) In the spirit of Richard Branson, we said, "Screw it, let's do it!" and started planning for New-Co in China. We brought on an exceptionally talented MBA from Beijing University (Vivin, who parks her flying saucer on a hill above the city) to be our eyes and ears on the ground in China while we prepped and to help guide us through the process. It's an honor to be working with such an awesome team.

The process of actually creating WFOE (Wholly Foreign Owned Enterprise) was fairly straightforward. After validating that Dalian was "the place" (versus other potential locations in China) we wrote up the articles of association, filled out all the required forms, booked our tickets and ventured forth. On arrival it took about a week to get all the WFOE details sorted out, starting from downtown Dalian we moved out to the economic development zone where all the high tech stuff is happening to meet with officials and sign final documents. It's about the same amount of work required to set up a LLC in the USA, although the experience was far less bureaucratic than similar structures I have formed in the US, EU or Japan. The Dalian Municipal Peoples Government clearly understands the value of technology sovereignty and importing Silicon Valley entrepreneurship. They proved their commitment to developing a culture of innovation by offering significant corporate tax advantages and exceptionally attractive lease terms for our first year in one of their technology parks. Of course the real work on this project is just beginningc

