SaaS Company US Setup: Delaware C-Corp Incorporation, Fundraising, and IP Protection Strategy

Challenges Faced

Clients face multiple challenges: balancing founder control with attracting U.S. venture capital (VC), which typically requires a Delaware C-Corp; ensuring clear intellectual property ownership to avoid future disputes, particularly for core algorithms and software copyrights; designing an effective equity incentive plan to attract and retain Silicon Valley technical talent; and managing tax compliance in both China and the U.S. to prevent double taxation.

Solutions

Tiger International has designed a comprehensive U.S. corporate setup plan for our clients. For company registration, we assist clients in forming a C-Corp in Delaware. We recommend Delaware due to its robust corporate legal framework, strong protections for shareholders and directors, low registration and maintenance costs (annual fee approximately $300 USD), no requirement for physical operations in the state, and its popularity among public companies and venture capital firms, offering extensive legal precedents. Our team supports clients with drafting the certificate of incorporation, establishing a board of directors, and allocating shares. Regarding intellectual property protection, we coordinate with U.S. patent attorneys to help clients file patents for 3 core algorithms, register trademarks (including product names and logos), and record copyrights. We specifically crafted an IP assignment agreement to ensure all intellectual property is transferred to the newly formed U.S. entity, mitigating potential due diligence issues during future fundraising. For equity incentive planning, we designed a hybrid ISO (Incentive Stock Option) and NSO (Non-Qualified Stock Option) program, reserving a 15% option pool. We assisted clients in developing grant schedules, vesting conditions, and exit mechanisms that attract top talent while safeguarding company interests. In tax planning, we implemented appropriate transfer pricing strategies to ensure profit allocation between China and the U.S. complies with both countries' tax regulations. We also helped clients obtain an EIN (Employer Identification Number) and open a U.S. bank account to receive dollar-denominated funding and manage daily operations.

Achieve Results

• Successfully completed Series B financing, raising $1500 million USD and increasing valuation 5-fold to $2 billion USD.
• Holds 3 U.S. patents, 2 trademarks, and multiple software copyrights
• Established a standardized equity incentive system, successfully attracting 5 senior engineers from Silicon Valley.
• Successfully entered the North American market, signing 20 enterprise clients including 3 Fortune 500 companies.
• Annual Recurring Revenue (ARR) grew from $500 million to $2000 million.