Startup Voice

Wednesday, August 10, 2016

Summary of Blog Post Topics on Startup Voice

To find a post of interest, use the search box at the top left-hand corner of the screen, review the list of "labels" on the right, or simply browse the posts listed below by topic.

I have tried to provide on my blog answers to most frequently asked questions relating to company formation and obtaining investment. If there are other general interest topics that you would like to see covered, please make a note of it in the comments section and maybe sometime soon you will see an answer posted on this blog!

General

Commonly Asked Startup Questions Answered (Expertorama Interview)
10 Basic Principles of Effective Networking
“Silicon Valley” Series – a corporate law perspective

Company Formation & Corporate Maintenance

Fundraising Process

Investment Terms

Investors' Perspective

“Silicon Valley” Series – a corporate law perspective

Over the past week or two, I binge-watched the first three seasons of HBO’s much talked-about series “Silicon Valley.” In truth, I only started watching because everyone was talking about it, and I felt that, given what I do, I needed to be able to participate in the conversation. But, I confess, I got sucked in, despite what, in my book, is an overabundance of profanity.

Given that counseling startups on corporate matters is my life, and one that I enjoy immensely, for that matter, I thought it would be interesting to analyze the legal basis to support Pied Piper’s predicament.

SPOILER ALERT! Don’t read any further if you don’t want to know what happens in the series through the end of the third season.

Board of Directors. The Board of Directors plays a key role in the fate of any company and we see the Board meet maybe four or five times throughout the series to make some pretty key decisions. But what is actually required for a Board to make a decision, legally-speaking? Here’s where the show took some liberties, for dramatic effect. There are only two ways that a Board can vote – by unanimous written consent, or at a meeting of the Board. The meeting must be attended by at least a majority of the directors, but all directors must be aware of the meeting. Meetings can be either regular (based on a pre-approved scheduled) or special. Each director must, typically, be given at least 48 hours’ prior notice of a special board meeting. Board meetings can be called on shorter notice, but only if each director waives notice.

If you’d like to get technical, notice requirements for special board meetings along with other corporate governance matters, can be found in the bylaws of a company. If you are a stockholder of a US corporation, the corporation is required to provide you with a copy of its bylaws on request.

How is it possible that Richard Hendricks did not know he was being fired as the CEO? In the show, Monica is the one to tell him. It’s a huge surprise and disappointment! But only the Board of Directors can fire or hire the CEO. They didn’t do it by written consent, because it has to be unanimous and Richard did not sign it. So they did it at a meeting, which he did not attend. That the CEO would miss a Board meeting is possible, though unlikely. However, It seems, he did not even know that a meeting of the Board was being held. Oops, that’s a problem from a corporate law perspective!

We see the same flop when Jack Barker, the outside CEO, gets fired in the next season. Richard and his co-founders come to the office to find his empty chair and Laurie Bream cleaning out his office. After Russ Hanneman sells his position to Raviga, Raviga acquires control of Pied Piper’s Board (three votes to Richard and Erlich’s two), so at a meeting they could certainly outvote the other members. But how ever did they meet in secret, without Richard knowing? But, let’s admit, the version in Silicon Valley is more fun! Laurie unexpectedly retaliating against Jack for his arrogance – a total Hollywood trope, no?

Convertible Loan. When Hanneman first offers a term sheet, the Pied Piper team is very excited. It saves them from having to sell to Hooli, and Jared (the only one to read it) thinks the term sheet isn’t bad. “It’s even structured as a loan,” they say, or something along those lines, making it sound like that’s the next best thing since sliced bread. Since we are talking startups, I can only assume they meant that he offered them a convertible promissory note.

For a $5M investment, at an early stage, using a convertible note is odd. Typically, we see convertible loans being used for much smaller investments early on. It is especially odd given that Hanneman apparently included a number of significant rights for himself, which aren’t usually given in a bridge financing. The primary reason why startups like convertible note financings is the simpler framework, which can be put in place in a matter of days, if needed, and at a fraction of the cost of a full-blown equity round.

An equity financing (the sale of shares), on the other hand, usually comes with all kinds of bells and whistles, which can take weeks or even months to properly negotiate with the investor and his counsel. Basically, doing a complex convertible note deal defeats the purpose of such investment structure for the company. So, let’s just say, whatever Hanneman’s term sheet said, it was a far cry from a standard Silicon Valley bridge financing deal, though certainly possible. For the sake of honesty, I will say that I have seen very simple equity deals with almost no bells and whistles and unduly complex convertible debt financings loaded with investor rights, even for much smaller investments than $5M. So, sometimes reality can be even stranger than fiction.

Later in the series, Hanneman’s assets fall below a billion, and he is no long a member of the three comma club. To remedy this, he sells his interest in Pied Piper to Raviga Capital. But what exactly did he sell? It sounded like he was selling shares. But if his investment had been in the form of a convertible note financing (a “loan”), he would not have had shares. Convertible notes will normally convert in a qualified (sufficiently large) equity financing round, which Pied Piper did not have. So, if Hanneman invested on a note, it should still be a note. Ok, maybe in the series they didn’t get into the fine details that I find so interesting. Maybe Raviga Capital acquired the promissory note. But it sure didn’t sound like it. In fact, on CrunchBase – yes, Pied Piper has a CrunchBase profile – Hanneman is listed as a Series A investor (https://www.crunchbase.com/organization/pied-piper/investors). Series A is a series of preferred shares, which are typically sold in an early equity financing (following Series Seed and preceding Series B).

Blocking Rights. Remember when Laurie buys Erlich’s shares for next to nothing, giving him just enough to cover his debt? She then explains to Richard, when he confronts her, in an exasperated manner, that under the terms that she inherited from Hanneman, she had the right to block any sale by Erlich. Full blocking rights on a sale by another stockholder? That is very unusual! Company right of first refusal on transfers by founders – sure! That’s quite standard. But all that would do is give Pied Piper the right to buy out Erlich if he had a third-party buyer for his shares, having to match the price offered to him by his buyer (in this case, $5M for half of his shares). Investor’s right of first refusal – could be. But that would give Raviga Capital the right to match Russ Hanneman’s price, and buy the shares that Erlich was offering to Russ Hanneman. No standard rights offered to investors would grant Raviga Capital the kind of blocking rights that it seems to enjoy in the series. In the U.S. and especially in Silicon Valley deals, we just don’t see an outright block by an investor on the sale of shares by another. So that was a bit sensationalist. Of course, just because the series is called “Silicon Valley” doesn’t actually mean it has to depict its protagonists being offered middle-of-the-road standard investment terms, and this is another instance where they weren’t.

Drag-Along. How was Raviga able to force the sale of Pied Piper? Control of the Board alone is not enough here. Such a sale would require an affirmative stockholder vote by, at a minimum, a majority of the outstanding shares, and Raviga is not a majority stockholder. I can only assume that among the terms that Pied Piper accepted from Russ Hanneman was a drag-along. A drag-along is a voting agreement among stockholders, which allows one group of stockholders to force the others to vote to approve an acquisition of their choosing. The group of stockholders that can force the sale depends on the deal. In certain scenarios, it can be a single influential investor. A drag-along would provide the necessary mechanism to support the forced sale of Pied Piper to Bachmanity.

Lawyer. How is it that Pied Piper does not have its own corporate lawyer after two rounds of financing? We are initially led to believe that Ronald LaFlamme, the extravagant guitar-playing chap, is Pied Piper’s lawyer. But he is actually counsel to Raviga! It’s on Raviga’s website – yes, Raviga has a website (http://www.raviga.com/index.html). When Pied Piper is about to enter into a white-label licensing agreement for its box, it’s Monica, who catches the grant of exclusive intellectual property rights to the customer. If it wasn’t clear enough in the show, that really is a huge red flag in a commercial agreement. So here we are, about to sign a multi-million dollar commercial agreement and an attorney representing Pied Piper hasn’t so much as laid eyes on it? Sure, Pied Piper is next-to-broke for much of the show, but this episode was actually at the height of its glory. Then again, maybe if Pied Piper had corporate representation from the outset, the founders wouldn’t have found themselves at the total mercy of their investors! And that is not a bad self-serving message for me to conclude on.

Happy company-making and enjoy Season 4, coming in 2017!

Inna Efimchik, a Partner at White Summers Caffee & James LLP, specializes in assisting emerging technology companies in Silicon Valley and beyond, providing incorporation, financing, and licensing services as well as general corporate counseling.

LEGAL DISCLAIMER

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Tuesday, September 15, 2015

Convertible Promissory Notes: 3 Mistakes to Avoid

To raise a Series A round these days a startup has to have a product, users, and traction. It may take a lot less money to get there than it did in 1999, but most startups still can’t bootstrap their way there. So before a company ever raises a Series A round, or even before it raises a Series Seed round, it will usually raise a convertible promissory note round, also known as a bridge financing.

While a convertible note financing is one of the simplest types of investment transactions, there are still a few nuances that, when done wrong, can really hurt a company down the road. For a very detailed write-up about convertible promissory note terms and structure, you can read my Annotated Convertible Promissory Note post. This post, on the other hand, is dedicated to some more nuanced mistakes to avoid.

All of the mistakes that we are going to discuss in this post are ones that won’t manifest themselves until there is a qualified equity financing, the note matures, or there are circumstances that require that the terms of the note be amended.

Conversion into a Shadow Series of Preferred. Let’s start with what is usually seen as the culmination of a startup’s early success – it has a term sheet for an equity financing round at a valuation that is significantly higher that then conversion cap on the notes. In this situation, the investors will typically insist that, despite what the note conversion provisions state, the notes convert into a shadow series of preferred stock, rather than the same series of preferred as the new investor.

The reason is that the certificate or the articles of incorporation, state in dollars the liquidation preference of each series of stock. If the purchase price per share of the new investors is $1.00 per share in the Series A round, and they are getting a 1x liquidation preference, then the liquidation preference of the Series A will be $1.00 per share. However, if the conversion price of the notes is only $0.10 per share, which may be the case if their conversion cap was 1/10 of the valuation of the new round, then with a $1.00 per share liquidation preference on each of their shares, the early investors would be getting a 10x return. This is not something that new investors will typically agree to. If there is no provision in the notes for conversion into a shadow series of preferred, and if the note investors don’t want to amend their notes, the equity financing can fall apart! Even if it doesn’t fall apart, the timing can slow down significantly, as management tries to work this out with their early investors.

For this reason, we recommend the automatic conversion provision in the notes to provide for conversion into a shadow series of Preferred Stock, if so requested by the new investor.

Conversion on Maturity. Convertible notes, despite the way that they are frequently being used by startups, are debt instruments, and as such, they have a maturity date. A “Maturity Date” is the date by which the debt must be returned, if not converted into equity. Startups, however, are not usually in the business of repaying convertible promissory notes, nor is repayment the result for which their investors are hoping when they make the investment.

As we know, building a company comes with many variables, and despite everyone’s best intentions and efforts, it is neither unlikely nor uncommon for a company to fail to raise a qualifying equity financing round prior to the maturity date. If that happens, there are several ways it could play out. The investors could agree to extend the maturity date and give the company time to raise an equity round. Or, if they are disappointed with how management has been running the company, they could demand repayment. If there has not been a qualifying equity financing round, it is unlikely that the company would be able to repay this loan, even if it has revenues. Of course, if its revenues are sufficient to repay the loan, it’s unlikely that the investors would want to be repaid!

For this reason, we recommend building into each note from the outset a formula for how the note will convert on maturity if it has not converted prior to such time in a qualified equity financing. The parties should decide on the class and series of shares into which the note will convert on maturity, which can either be common stock, a new series of preferred stock, or an existing series of preferred stock, if the company already has issued preferred stock. If the note is going to convert into a new series of preferred stock, then the parties have to agree on at least the basic rights, preferences and privileges of this series. The notes should also specify the valuation that will be used in the conversion or another algorithm that will be used to determine the number of shares that will be issued to the investors in the conversion in cancellation of the loan.

Amendment Provisions. The “Amendment” section of an agreement is the section that specifies how that agreement may be changed in the future. If there are only two parties to an agreement, this is simple – the agreement can be changed with the consent of both parties. On the other hand, if we have an agreement with many parties, like a shareholders’ agreement among fifteen shareholders, in order to make it possible to ever amend that agreement, we might set some minimum threshold, e.g., the shareholders representing a majority of the voting interests must approve the change for it to apply to the agreement and bind all the other shareholders. This prevents one party from holding everyone else hostage when changes need to be made.

Now that we understand the principle of it, let’s talk about how it applies to convertible notes. On the one hand, each note is an instrument issued by one party – the company, to the other – its investor. If there are 15 investors, then there are 15 different notes. On the other hand, we can think of these notes as part of one bridge financing transaction. They will usually have substantially the same terms, and will frequently be issued pursuant to a single note purchase agreement to which all of the investors will be parties. Finally, in the ideal world, all of these notes will convert in the company’s next equity financing into most likely the same series of stock with the same rights, preferences and privileges. From this perspective, it is in the company’s interests to make the process of amending the notes, which frequently must be done in connection with a qualified financing round, as painless as possible. If, in order to amend 15 notes, the company must get the consent of each of the 15 investors, this slows down the equity transaction and gives each of the investors a lot of leverage. For this reason, our strong recommendation is to draft the amendment provisions of the promissory notes issued by a company as part of the same bridge financing transaction, even if that transaction spans over the course of six months or a year, to allow for amendment by a majority-in-interest of the note holders.

Happy company making!

LEGAL DISCLAIMER

Copyright Notice. The copyright for all original content in this post and any linked files is owned by Inna Efimchik. All rights are reserved.

Friday, January 23, 2015

What Do Startup Investors Want?

It is a well-known fact that startup investors, whether they are angels or venture capitalists, ultimately make their investment decisions emotionally, or, to say it another way, based on a gut feeling.

However, if you are an entrepreneur looking for funding for your startup, this knowledge alone does not help because it does not answer the question “what does an entrepreneur need to convey to the investor, for the investor to have the right emotional reaction which leads him to write the check”.

What then do early-stage investors in the tech sector look for when they are evaluating a project? What are the factors that make them excited about one project but not another?

People. The investor needs to believe in, in fact, be inspired by, the entrepreneur and his initial team. He needs to be convinced that this particular team has at least the following characteristics:

the necessary technical skills to complete the project in the proposed timeframe,
the required steadfastness, dependability, and firmness of character to see the project through, and
the personalities among the founding team that will complement, rather than detract from, one another, especially when times get tough (as they often do in startups).

Some ways to demonstrate to an investor that the team has what it takes, to name just a few, are (i) a history of working together as a team on a prior successful project, or (ii) external validation of the project for which funding is being sought through market traction.

Opportunity.

Economic. To elicit the right emotional response from an investor, an entrepreneur needs to persuade the investor that, when properly executed by the right team, there is tremendous economic opportunity in the project. That may mean that the project is in a fast-growing market and that its premise is promising in light of what are perceived to be future trends. It also means that the investor can (and does) imagine a scenario where, with the right execution, the project will generate a significant economic upside, a return on investment of 10 to 30X.

Impact. Some investors will be looking specifically for projects which promise to generate a measurable, beneficial social or environmental impact alongside a compelling financial return. This is called impact investing and it is becoming more widespread. When pitching, it is critical for the entrepreneur to know whether the investor subscribes to this investment mandate. If so, he will be a lot more excited about a project that seeks to build literacy than the next “Cut the Rope” app.

Competitive Advantage. Finally, there needs to be a convincible competitive advantage, one that will allow this particular project to succeed over others in the same space. Its people, with deep specific expertise in an obscure area highly relevant to the project, for example, may be such competitive advantage. It may also be the technology behind the project, preferably protected by strong patents. Having a significant head start in an industry with a high barrier to entry might be another.

One way or another, an investor needs to feel that the horse he is asked to put his money on, the particular project that he is asked to invest in, in keeping with the metaphor, will come in first. The factors listed above, when applied to a startup especially, are highly subjective. It is the entrepreneur who is able to convince investors that his project excels in all three categories that attracts capital easily and gracefully!

Happy company making!

Inna

LEGAL DISCLAIMER

Copyright Notice. The copyright for all original content in this post and any linked files is owned by Inna Efimchik. All rights are reserved.

Monday, January 6, 2014

Information Rights of Shareholders in a California Corporation

Generally, all shareholders of a corporation registered in California are entitled to obtain from the corporation, upon request, certain corporate information. The type of information and the requirements that a shareholder must meet to get access to it it depend on the size of the corporation and the size of the shareholder’s equity interest in the corporation. In certain instances, it is required that the shareholder state a “purpose reasonably related to such interest.”

When Is “Reasonably Related Purpose” Not Required

Generally, all shareholders irrespective of the size of their equity ownership in a corporation are entitled to receive an annual report (CA Corporations Code Section 1501), except that a corporation with fewer than 100 shareholders may expressly waive this requirement in its bylaws. In such a case, the shareholders are entitled to receive a financial report similar to what an annual report should entail.
All shareholders irrespective of their of the size of their equity ownership are entitled to receive a copy of the corporation’s bylaws (CA Corporations Code Section 213).
All shareholders irrespective of of the size of their equity ownership are entitled to receive the results of vote at a regular, special or annual meeting (CA Corporations Code Sections 1509-1511).
Shareholders owning individually or in the aggregate at least 5% of corporate shares are entitled to obtain and copy shareholders register and records (CA Corporation Code Section 1600) and quarterly financial information (CA Corporations Code Section 1501(c)-(d)).

When Is a “Reasonably Related Purpose” Required? Other than the situations delineated above, all other shareholders are required to state in writing a reasonable relationship between their interest in the corporation and the purpose of their inspection of books and records. In fact, if such relationship purpose of inspection of records and books is stated, then such shareholders are entitled to inspect (CA Corporations Code Sections 1600 and 1601):

Shareholder lists and Records
Minutes of Books and Records
Accounting Books

What is a “Reasonably Related Purpose”? The courts are unfortunately not clear on the answer and the legislation is not clear as to the time frame during which the written demand should be made on the corporation. Hence, the corporation is afforded some time to intelligently evaluate the “reasonable purpose” and ascertain the next course of action. If the corporation decides to withhold the information to a shareholder owning less than 5% of shares in the corporation, then the next venue will probably be courts.

What is an Annual Report? An Annual Report encompasses the following (CA Corporations Code Section 1501(a)):

Income Statement; and
Statement of Cash Flows for the Applicable Fiscal Year

Other Important Rules

The statutory right of shareholders to inspect and copy corporate books cannot be limited by articles of incorporation or bylaws. (CA Corporations Code 1600(d)).
The copies of corporate books, under this section, could be made by person, attorney or agent. (CA Corporations Code 1600(d)).
The shareholder’s right is to inspect records at the corporation’s office and to make copies and extracts of the records. The corporation has no obligation so send such records to the shareholder.

Happy company making!

Inna

LEGAL DISCLAIMER

Copyright Notice. The copyright for all original content in this post and any linked files is owned by Inna Efimchik. All rights are reserved.

Monday, September 30, 2013

What Can Startups Disclose, Before Filing a Patent Application

The current wisdom on attracting investment for a startup states that the way to get the attention of frazzled investors is to present them with a short video that draws them in. From the perspective of getting emotional buy-in from investors and willingness to spend 5-10 minutes reading a startup’s executive summary or browsing its investor deck, a promo video is the way to go.

But if a startup has not yet filed at least a provisional patent application, what can be the ramifications of such a video? I have asked Mark Beloborodov, an experienced U.S. patent attorney, to explain the risks of early disclosure.

America Invests Act. According to the expanded definition of “prior art” pursuant to the Leahy–Smith America Invents Act (AIA) that went into effect on March 16, 2013, public use, sales, publications, and other disclosures available to the public anywhere in the world as of the filing date bar patentability. Public disclosure of the invention by the inventor (or someone else who “obtained” the disclosed subject matter from the inventor) within one year prior to filing (inventor's "publication-conditioned grace period") constitutes an exception. This exception is a concession to opponents of the AIA’s “first-to-file” regime that already exists in the European Union and the rest of the world, and a carryover from pre-AIA patent law, which has traditionally given startups comfort to discuss their invention publicly before filing a U.S. patent application, in connection, for instance, with fundraising efforts.

Product for Sale. One potential problem that a promo video featuring the product may pose is that it may not fall within the “publication by inventor” exception, but may instead be considered an offer of sale of the product featured. Any novel and non-obvious features, functionalities and attributes implemented in the product that, prior to the video’s release, constituted patentable inventions, may suddenly fall into the public domain and thereby substantially reduce the value of the business. Publication. But suppose that the promo video (or an article) does not reach the level of the offer for sale and qualifies for the publication-conditioned grace period. Does that mean that it is safe in those circumstances to disclose inventions, for which a patent application has not been filed?

It’s not so simple, says Mark. While the disclosed inventions themselves may still be protected, what if a public discussion is spurred by the disclosure that builds on the information made public by the inventors? Anything that is generated in that public discussion above and beyond what the inventors disclosed falls into the public domain. If the initial publication disclosed only part of the invention, and then other elements of the invention surfaced in subsequent public disclosures, even such other elements previously known to the inventors, patent protection for those elements may not be sought later. So any disclosure prior to at least a provisional patent application is fraught with risk even in the US, not to mention loss of patent protection for the invention as a whole in other countries.

The Band-Aid Solution. So what’s one to do? In the perfect world, a startup’s patent application would be prepared by a patent attorney in advance of starting to pitch investors and certainly well in advance of publicly distributing promotional materials. Such application, even if a provisional one, would be drafted after careful consideration of the invention and would contain a detailed and enabling disclosure of how it is made and operates, which fully supports patent claims to be included later in the full-blown application.

But we don’t live in the perfect world. To preserve intellectual property rights in the product or solution that will be the subject of an upcoming promotional video, Mark recommends making at least a minimalist provisional patent application filing before the video becomes public. Even if the filing consists of little more than the video script, overview of key components of the invention, and annotated screen shots illustrating them, risky as it is, it’s better than nothing. After the founder strings together the materials that will go into the promo video, it is advisable to have a patent attorney do a quick review. This might translate in total into a $1,000-$1,500 cost, including the filing fee, but, if it may preserve intellectual property rights that might otherwise be lost forever, seems like a good compromise.

Happy company making!

Inna

LEGAL DISCLAIMER

Copyright Notice. The copyright for all original content in this post and any linked files is owned by Inna Efimchik. All rights are reserved.

Monday, September 9, 2013

Preparing for a Silicon Valley Fundraising Trip

[This post is an excerpt from my presentation entitled Silicon Valley Fundraising Trip: Tips for the Non-U.S. Based Startup Founder.]

If you are traveling to the Silicon Valley to raise capital for your startup from abroad, you can save yourself a lot of time and make the trip more efficient by preparing thoroughly and doing your homework before the trip. Here are some things that should not be overlooked:

Research. Before your trip, sign up for startup networks, groups and mailing lists, to receive announcements about upcoming events. (This is covered in more detail in the full version of my presentation.) You should know which venture capital firms and super-angels are investing in your space. You should research and consider which strategic investors you should target, if any. Based on your research, prepare a list of 10 to 20 people that you’d like to meet while you are here. This list is aspirational, so if you do not get the opportunity to meet all of them, you have not failed.

LinkedIn. Create a LinkedIn profile, if you don’t already have one. If you have one, check to see if it's time to review and update it. This is your business resume. Most professionals rely on it!

Don’t be lazy – take the time to write-up prior projects and experience, your education, and anything else relevant to what you are doing and to who you are now. This is your chance to tell people what you want them to know about you!

Note that LinkedIn is also a great place to do your own “diligence” about the people you’ll meet while networking, through introductions, or otherwise.

Video Presentation. If you have the resources, create a short video teaser and post it on YouTube or Vimeo for easy sharing with new contacts. A few excellent examples are below. Notice how effective it is if the teaser can demo your product or service. A picture is worth a thousand words. And a video is worth at least a thousand pictures, charts and graphs.

Videos work well to get you a foot in the door (not seal the deal for you). Before an investor takes the time to read your executive summary, in fact, before he even makes the decision about whether it's worth his time to do so, it is helpful if you can get him excited (or at least curious) about your product or service. The way to do it is by offering information in an easy and fun format - video - that appeals to the viewer's emotions, not just his intellect.

Executive Summary / Presentation. VCs don't read business plans. They just don't have enough hours in the day to screen companies based on their business plans, and, frankly, with business at an early stage, a business plan reads more like astrological predictions than fact.

Still, if you are talking to an investor at a networking event, or have been introduced to an investor by email, he will want to see something in writing about your company. You will be expected to send an executive summary (a one-pager that introduces the investor to your company and piques his interest) or, more frequently these days, an investor slide deck (8-10 PowerPoint slides that serve the same purpose but are easier on the eyes).

Instead of trying to work with your team back home when you are already here, faced with a time difference and time pressure, prepare this before you come. You may have to adjust it based on the feedback you receive from investors, but if you have a solid draft, it will make your life easier.

A really well-made executive summary or deck can set apart your startup from the rest and give you a fighting chance at a more involved look from the investor.

You can work with designers and advisors to help solidify your message in your materials. But do not hire someone to write them for you. You have to own your materials, and by that I don't mean the legal sense of ownership, but in the sense that you stand behind each word in that document and, if prompted, can expand in verbal or written format on any of the points made in it!

U.S. Phone Number. With your Google account, you can get a free Google Voice number and set up call-forwarding from that number to your temporary U.S. number.

Google Voice also offers voicemail functionality. Make it easy on your callers - record a greeting with your name and the name of your company, so that they know they reached the right number.

Business Cards. Your business card should be in English and should contain (1) your company name (and if you have not registered the company, the name that you think you will use), (2) your name and title, (3) your corporate domain email address, (4) the address of your physical office (if any), and (5) your U.S. phone number.

Note that you don’t have to spell your name on the card the way it is spelled in your passport. Feel free to spell it in a way that will make it easy for English speakers to read. This will save you time and annoyance, unless, of course, you like correcting people and having off-topic conversations about foreign names, the English language, pronunciation, etc.

Credit Cards. The most common and convenient payment method for most things that you’ll need to buy on your trip will be a credit card. Every online purchase will require it and some merchants (like car rental places) will take your credit card number as a security deposit, even if you pay cash.

When getting ready for your trip, make sure there is money in the account tied to the card that you are taking with you. To really play it safe, take several credit cards tied to accounts at different banks. It is best to call ahead, and let your bank know that you will be in the United States. Sometimes banks will suspect identity theft and block your card, if there is unexpected activity on your card in a foreign jurisdiction. Nothing quite makes travel so uncomfortable, as having your credit cards lock up, when you are relying on them as a primary payment method!

Driver's License. While you are visiting California, you are permitted to drive with your valid foreign license. Make sure to take it with you, as you are packing for your trip, and that it does not expire during your trip (rendering it no longer valid).

Happy company making!

Inna

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