Starter Kit. Idea 320 of 500. Cluster 15
Sri Lankan-founded startups incorporated abroad with the engineering here, the Virtusa route, deliberately
The mechanism, from the book
The proof exists in Malabe. What is missing is a thousand small versions of it.
The first step
Take a product you have already built or started, and ask three prospective customers abroad whether a company registered in their country would make them more likely to buy. Then ask an accountant abroad for the cost of incorporating there and contracting the engineering here. The customers' answers and the quote let you decide before spending anything.
- Who pays first
- A foreign customer or investor who needs a company in a familiar jurisdiction but is glad to pay for engineering done here.
- What leaves today
- Engineering done here earns only wages, while the company's value, its equity and its headquarters sit abroad with no deliberate link back.
Ask first
- Department of the Registrar of Companies. Ask how a local company can contract engineering work for a parent company abroad.
- Board of Investment of Sri Lanka. Ask whether a company doing engineering for a foreign parent qualifies for any scheme.
Check before you spend
Who owns the code and the company shares, how money moves between the two countries, and the tax effect of each choice, confirmed by an accountant.
Find out these three numbers
- Would customers abroad buy more from a company registered in their country?
- What does incorporating and running a company abroad cost each year?
- How much engineering will the local company bill in a year?
A comparison from the book
Ekala, Bogala and Malabe. Chapter Three
"case the thing that was built ended up belonging to somebody else, usually for a price"
Register abroad if buyers need it, but keep the ownership and the engineers here.
The test
Does it keep value that now leaves the island, or build the proof that lets somebody else do so?
From the appendix of Why Not Sri Lanka? by Dr Maheshika Halbeisen. The idea and the mechanism are the book's; this kit was written for the site.