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I have an e-commerce site and the company is registered in Florida, US. I'm located in Israel, and I have an idea to create a social network site. My main question is which of the following options is the best:

  1. Open a new company for the new site in the US.
  2. Create a DBA in Florida. What do you recommend for taxes issues and for the image of the company (imagine Facebook having also an e-commerce site)?
  3. Create an Israeli company from scratch without any relation to the e-commerce site in the US. At this time I don't have any registered company in Israel. Israel is known as a good place to create a startup, but also in US California.
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3 Answers

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I think you should contact a lawyer and an accountant and get official consultations.

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@ron M: Per Google translate: "He's right, you need a tax lawyer and a consultant to outline the optimal route for you." (Hebrew to English) – blunders Jun 3 '11 at 14:49
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First, I guess I've never heard of Florida being a great place to create a legal structure for a company, Delaware I believe is one of the most common.

In terms of you being a foreign national doing business in another country, in this case the United States, I have no knowledge or experience on the matter; though it would be interesting to know how hard it is to do.

In terms of starting an Israeli based company instead of one in the US, it depends on the market, but I'd say if the network of people you serve in a region, then have the business in that region would increase your odds of success.

UPDATE:

Another issue, which might even be the reason you've got a business in Florida - shipping across international lines can not online be a huge pain in some cases, but also add to the cost of doing business in a remote region.

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You don't necessarily have to register the company in the area most of your customers are in; I would say that a social network is a good example of this. However this is different in different cases and locations, which is why a lawyer/accountant consultation will provide you with invaluable knowledge and guidance in these matters. – Sam Jun 3 '11 at 15:07
@Sam D: What would a lawyer or an accountant know about marketing... :-) ...I'm not saying there's a legal reason to do it, I'm saying that having a company based in the market it services is more like to build trust. For example, if you had the choice between doing business with a company in Canada (where you are according to your profile) or in Israel... which would you prefer, especially if the nature of the business relationship was commerce; as it is in the case of the business asking the question. Thanks for the comment! Cheers! – blunders Jun 3 '11 at 15:13
Yeah I see where you're coming from. If its purely a marketing concern, (depending on how many employees the company has) you may want to look into setting up virtual offices in markets of core concentration. This should achieve the notion of your business' physical presence in these markets, even when you are not physically there. – Sam Jun 3 '11 at 15:18
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Based on your question, there are two parts:

  1. Consult an attorney for the legal.

  2. Consult a true marketing specialist on the brand part of your issue.

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