What are the benefits of Flipping?
Written By
Priya Kapasi Shah, Rohit Gandhi
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- Global Market Access: Flipping core business operations outside India provides a wider audience to the startup. This enables the startup to reach out to a global audience as compared to just India. This access is enabled because of the reasons below which act as a catalyst for such access and expansion.
- Ease of Operations to manage foreign currency transactions: Multi-currency payment gateway management is easier in jurisdictions like Singapore and the USA. This facilitates faster reconciliation, easier payment mechanisms enable the business to grow faster and swifter.
- Access to global incubator/s, investors, etc: Flipping opens up new funding opportunities for startups. Exposure and access to global incubators, VCs, and accelerators who may be restricted from funding companies abroad. The new company enables startups to pitch and seek funding from such specialized funding players.
- Flexibility of financing options and structuring: Countries like Singapore/USA have easier and more flexible regulatory frameworks for the functioning of businesses. For eg in terms of granting of ESOPs, faster IP registration mechanisms, and robust judicial procedures. This offers ease of business and malleability in business operations that startups require. Additionally, options like revenue-based financing and line of credit schemes for startups are easily available. This empowers the entrepreneurs to avail of better financing options than diluting equity all the time.
- Lower tax rates in certain countries: Multiple countries have lower tax rates which turn out to be lucrative for startups. A lower corporate tax rate helps startups to manage cash flows and plan better for resources.
About the Author
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Priya Kapasi Shah
Associate Partner | Tax & Regulatory | priya.k@treelife.in
Heads Treelife’s Financial Advisory practice, specializing in investment structuring, cross-border transactions, and tax and regulatory advisory. Also leads on AIF setups and advisory services for GIFT IFSC.
Rohit Gandhi
Senior Associate | Tax & Regulatory | rohit.g@treelife.in
Specializes in financial due diligence, valuations, business structuring, and income tax advisory. Contributes to the Financial Advisory team by helping startups and businesses make informed strategic decisions.
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