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How to start a home-based business in California

Date: 08/04/2021 | Category: | Author: developers

How to start a home-based business in California?

In the digitally connected world of today, there is a higher engagement of home-based businesses with technology and online e-commerce platforms. There are a variety of industries where you can start a home-based business in California right from computer-based consulting to food delivery services. This is a guide specifically created to help you understand how to start a home business in California including business registration, tax registration, licenses and permits, and zoning laws and regulations.

Home Based Business in California

There are 4 million small businesses in California and a majority of such businesses are startups from home. There are almost 15 million home-based businesses in the U.S and it is not surprising that 69 percent of startups have sprung from home-based business ideas.

A home-based business also known as “HBB” is basically a type of small business, which operates from the residence of a business owner or entrepreneur. It is no hidden fact that some of the industry and global leaders like Apple Computer, Hallmark cards, Baskin-Robbins, Amazon, Disney, Microsoft, Google, Harley Davidson, Hewlett-Packard, and Nike were initially home-based businesses and some of them have their roots in California.

Your startup idea can also be started from a garage, home, or even the kitchen including California’s famous meal delivery kits, which has turned into a trend that entrepreneurs in other states are planning to follow. You will need to apply and obtain home business licenses or permits and ensure compliance with zoning laws for your home-based business to become operational.

Why start a home-based business in California?

If you are planning to start a home-based business in California then it is certainly a good decision as the state itself promises opportunities, infrastructure, and a robust platform for any form or type of business. The GDP of California is $3.09 trillion and much of it can be owed to the 4.1 million or more small businesses that are currently operational in the state. It has the second-highest number of small businesses in the nation and its economy has been growing at an annual rate of 3.5%, which is more than the U.S economy. If you are wondering how to start a home business in California then there is a process for the same but first it is important to understand what makes California one of the first choices for entrepreneurs and home based startups. There are several aspects that make California popular and this includes:

  • Networking: One of the biggest benefits of a home-based startup is the availability of networking opportunities. When you start a home-based business in California, you can join any of the networking groups and participate in meetups, conferences, and events. The important aspect of becoming a part of such groups is that you will be able to meet and communicate your business ideas to industry experts, investors, and probable customers or retailers. The networking groups provide a platform for showcasing your business ideas.
  • Diverse industries: If you have home-based business ideas then California offers you the platform to set up a new business in a variety of industries. The fastest growing industries include construction, hospitality, healthcare, agriculture, and technology although the biggest industries in the state are the services sector including tourism, film industry, and agriculture. The industries also vary from one city to another like the largest industry in San Francisco is tourism while the largest industry in Los Angeles is the high-tech industry and then there is the Silicon Valley. You can choose your industry in accordance with your startup idea, obtain home business licenses, and make your enterprise operational.
  • Robust Business Infrastructure: California, nicknamed the Golden State has a robust and strong economy, is ranked 5th largest in the world, and represents 15 percent of the U.S economy ($22.68 trillion). The clean and efficient economy along with innovative policies have helped change the industrial landscape thus helping new-age entrepreneurs to start a home-based business in California successfully. At the heart of the economy is the robust business infrastructure, which includes logistics infrastructure like railroads, ports, airports, trucking companies, and warehouses. The supply chain in California runs deep and is one of the key drivers of the economy.

Popular home-based business ideas

California is home to small and medium sized enterprises (SME’s) and a majority of such entities have grown from home-based business ideas. In order to understand how to start a home business in California, you need to first identify the type of home business that will bring you growth and success. There are several industries or areas where you can form a startup but if you are looking for trending ideas then here are some:

  • Online Consulting Business: You can start a home-based business in California as an online consultant. The type of consulting will vary according to the knowledge and skills acquired over the years. Some of the key areas of online consulting include career consulting, leadership and team building, green living consulting, organization and efficiency, digital marketing, virtual assistant, social media consultant, and stress management among others.
  • Online Services: This is a wide area and the type of work you offer will determine the home business licenses and permits required. The scope and opportunity is huge and encompasses several areas right from blogging to affiliate marketing, publishing ebooks, graphic designing, information research, and selling home-made products through ecommerce websites.
  • Handmade Crafts: One of the areas that have gained popularity in recent times is handmade crafts. Entrepreneurs are actually converting their hobbies into serious businesses like jewelry designing, T-shirt designing, ceramics making, Wood DIY, handmade cards, pour paintings, stone or rock painting etc.
  • Home-based food services: This is an area where you can start a home-based business in California. Food services have always been a high-growth area and there are a variety of niches that you can experiment with. Some of the popular ideas in this category include creating and selling baked goods, specialty items like gourmet chocolate, cooking instructor, nutrition coach, food blogger, home-based cookie business, food photographer, and home chefs or home cooked meals.
  • Computer based businesses: There are different areas within this category that you can focus on depending on your strength and skills. It is important to understand that most businesses in this category will require home business licenses or permits. Some of the most popular areas include computer trainer or tutor, computer repair, desktop publishing, IT consulting, Tech blogging, technical writer, website design, App development, software development, and game development.

Steps to Start Home Based Business in California

If you are wondering how to start a home business in California then it is important to understand that there are certain aspects within the entire process that you will need to consider. There are specific elements that will drive your home-based business ideas from their conception stage to implementation and finally operational stage. Starting a business from home will provide you with greater flexibility in terms of time spent and initial startup expenses. So, let’s take a look at the key areas that you need to focus in order to start your home business successfully.

1. Create a business plan

Before you can start a home-based business in California, it is necessary to create a business plan. A business plan is considered to be a strategic tool for business owners and entrepreneurs. This type of strategic plan takes into consideration several aspects related to the conception phase, the operational phase, and the sustenance phase of a business. It helps entrepreneurs to focus on areas crucial to the overall success of the business like market research, need for home business licenses, short-term and long-term objectives. Some of the key areas of a business plan for home-based startup are:

  • An executive summary of your home-based business ideas
  • Research of the market you plan to launch in
  • Existing and expected competition
  • Marketing, Advertising, and Sales strategy
  • Ideal customer identification
  • Financial planning
  • Operating plan
  • Startup Expenses

2. Check zoning laws and regulations

Anyone can start a home-based business in California but it is always important to check local zoning laws and regulations first. It is important because if you start a home business without checking zoning regulations then your business can be red flagged by zoning officials and this can even lead to penalties. You are probably wondering what are zoning laws and how you can check out the laws in your area. Let’s look at an example.

You are planning to form a home-based startup in Los Angeles city and want to obtain home business licenses for the same. Your residence is situated at WILCO – 2525 Wilshire Blvd, Los Angeles, CA 90057. Now, you will need to visit the Los Angeles city Planning website and check what the zone classification for your residence is. If the zone classification is C-2 then it means that certain types of businesses will be restricted in that zone based on the City’s Zoning Code. You can also visit the public counter at Los Angeles City Planning’s Development Services Centers (DSCs) for consultation on the applicable zoning laws and the regulations you need to meet to start a home-based business in California.

3. Register Your Business

A business can have different forms or structures and if you are planning to start a home-based business in California then identifying the structure is important. When you choose a structure like a partnership, sole proprietorship, or LLC then the business registration requirements will be in accordance to the structure. If you form a domestic limited liability company then you will be required to file “Articles of Organization” to register the business. If you form a General Partnership (GP) then a “Statement of Partnership Authority” has to be submitted. If you are planning to form a sole proprietorship then you will be required to obtain home business licenses, permits, and zoning clearance. We at IncParadise can provide guidance on choosing the right business structure and also help you register your new business.

Start a California home-based business with ease!

4. Get Mail Forwarding

If you are someone who travels a lot or if you are residing outside California and want to start a business in the state then a mail forwarding service can be quite convenient and helpful. The service is also helpful if after you start a home-based business in California there is a permanent or temporary change of address. In such a scenario, all your important mail may get lost, stolen, or returned to the sender.

A mail forwarding service ensures all your important mails are not lost or stolen and instead are sent to a physical location in the state where your home business has been registered. Mails can include anything from business registration documents to annual report notices, health care information, and tax notice from IRS, bills, renewal notices for home business licenses and checks among others.

5. Check if you need to obtain EIN

Home-based business ideas can be transformed into a startup in California but the business structure will determine whether you need to apply for and obtain an EIN (Employer Identification Number). Normally, if you start a sole proprietorship business then you will be required to file taxes using your social security number (SSN). Simultaneously, if you were to hire employees or form a partnership or a limited liability company, then you will need to apply for an Employer Identification Number from the IRS. You can also obtain an Employer Identification Number even if you don’t require one as it has several benefits like it helps avoiding identity theft.

6. Register for taxes

If you start a home-based business in California then you will be required to register for taxes in the state. Whether your business is an LLC, corporation, or sole proprietorship, you will need to file franchise taxes or income tax return. Once you have formed your business and obtained home business licenses and permits, you will have to report all your income or losses from the business through individual income tax return using Form 540. According to the Franchise Tax Board, California, you may be required to report your business income as well as expenses on the IRS Form 1040 Schedule C.

7. Obtain necessary licenses and permits

Once you have applied for formation of a home-based startup, the next important step would be to look up home business licenses and permits you may require. In the state of California, there are primarily two types of licenses:

  • General Business License: This type of license is applicable for any business owner including those planning to start a home-based business in California. The general business license will be issued by the city in which your home-based startup is located. This type of license is also known as a business tax certificate in some of the cities like the City of San Diego and City/County of San Francisco. You can find more information on the type of license or permits required from California’s CalGOLD website.
  • Regulated Professions and Industries Licensing: The “Professions and Industries Licensing” is required by businesses only if they fall under specific categories and this is apart from your general business license. If your startup falls under categories or professions mentioned in the California professional licensure guide then you will have to apply for home business licenses and permits with the Department of Consumer Affairs (DCA) and the Department of Industrial Relations (DIR). If you start a home-based business in California like a real estate salesperson or broker, acupuncture services, Manicurists (nail care), and veterinarians among others will require this type of licensing.

Identify business licenses and permits required by your California Startup

Ready to Start Your Home Based Business in California?

A home-based business is quite different from the medium sized enterprises in terms of business structure, operations, and market although there are several examples of California home-based startups becoming big corporations with time. If you start a home-based business in California, you can leverage the state’s economy, the business infrastructure, and small business incentives. The first step though is to form or register your startup in the state. If you have been wondering how to go about registering your home-based startup then IncParadise can provide you with valuable assistance. We are a reputed California registered agent and our team of experts can guide you with the process and filing for starting your business in California.

We are one of the top new business formation service providers in California and can also provide additional services to help start a home-based business in California like filing of annual reports, and EIN assistance among others.

Start a California home-based business with IncParadise!

How to form a startup in Silicon Valley

Date: | Category: | Author: developers

How to form a startup in Silicon Valley?

The foundation for the Silicon Valley startup ecosystem as we know it was placed in the 1940’s and the 50’s. The area between San Jose and San Francisco is famously known as the Silicon Valley and was almost single handedly created by one of the most successful entrepreneurs – Leland Stanford. There are several notable names behind the growth of this valley including Bill Hewlett and Dave Packard, who went on to create the brand “HP” and William Shockley from Palo Alto was awarded the Nobel prize in physics. The success stories are many and if you are planning to register a Silicon Valley startup then this is the article that will provide you with a path towards establishing your business here.

Silicon Valley Startup Heaven

Some of the top entrepreneurs and first time business owners want to form a Silicon Valley startup as the business environment and startup ecosystem is just perfect when it comes to valuable resources and business growth enablers.

The Silicon Valley located in the southern part of the San Francisco Bay Area is considered to be a global center for innovation and high-end technology. The largest city in this area is San Jose and is home to top startup industries in Silicon Valley. Some of the top names include PayPal, Cisco Systems, Adobe, eBay, Western Digital, and Hewlett Packard Enterprise among others. Some of the other major cities in the Silicon Valley that are home to startups include Palo Alto, Santa Clara, Sunnyvale, Mountain View, Redwood City, Cupertino, and Menlo Park.

The valley is not only home to more than 30 Fortune 1000 businesses but also receives one-third of total venture capital investment being made in the United States. Today, it is a global synonym for any areas or regions that consist of high-tech research as well as enterprises. The question is what does the startup ecosystem constitute?

Silicon Valley startup ecosystem

Silicon Valley is home to different types of business organizations and institutions, which have facilitated the creation of a robust business environment. This environment is a part of the Silicon Valley startup ecosystem and is highly conducive towards the successful creation and operation of startups, leadership in several high-tech specialization areas, and disruptive business models. The ecosystem is driven by several components and has a variety of characteristics, which make the Silicon Valley system work in a synchronized manner thus making it conducive to register a Silicon Valley startup.

At the heart of the Silicon Valley startup ecosystem is the Silicon Valley Innovation and Startup Model. The model comprises of three different levels and they are:

  • The Micro level: Focuses on Product, People, and Pivot
  • The Meso level: Comprises of Capital, Universities, Government, and Support Networks
  • The Macro level: Revolves around Culture inspired by generations of startup founders

The 1,854 sq. miles of the Silicon Valley startup ecosystem not only represents the world’s 19th largest economy but is also home to several world-class research institutions including corporate research labs. The startup ecosystem of Silicon Valley is 3 times bigger than New York City and 12.5 times bigger than Berlin. Such a thriving and constantly evolving ecosystem helps top startup industries in Silicon Valley to achieve strong growth. The startup ecosystem of Silicon Valley comprises of six players and they are:

  • Startups
  • Large tech companies
  • Investors
  • Accelerators
  • Universities
  • Co-working spaces

Why is Silicon Valley good for startups?

The Silicon Valley startup ecosystem boasts of a dual ecosystem consisting of startups and large firms existing symbiotically. Silicon Valley is considered to be a comprehensively integrated as well as balanced business ecosystem that ensures startups are able to leverage from the leading-edge innovation, pro-startup culture, and pioneering entrepreneurship. The Silicon Valley ecosystem provides support to startups so that they can push forward their dreams into a global market. Some of the factors that play a key role if you plan to register a Silicon Valley startup are:

  • Successful entrepreneurs as well as startups can enjoy high financial returns
  • Availability of top-level global human resources for various stages of a startup
  • Existence of strong business and industry like accounting, IT, law, etc.
  • It is the most competitive market for venture capital (VC’s) and other investors
  • Ivy league and top ranked universities like Stanford, UCSF, and UC Berkeley
  • Most human resource clusters are anchored around these top universities
  • Availability of top startup accelerators in the Silicon Valley provide startups with advice, mentorship, and resources
  • The government plays an extensive role in shaping current and future technological trajectories
  • There is a fine balance between open innovation, secret protection, and intellectual property protection amongst highly competitive industries
  • There is a high mobility of labor at different management and talent levels
  • There is a strong and positive culture of accepting failures leading to effective evaluation as well as monitoring

Top startup industries in Silicon Valley

The Silicon Valley as well as the Bay Area is considered as the greatest hub for new businesses and startups. This is because when you form a Silicon Valley startup; the existing and continuously evolving and expanding infrastructure provides the necessary platform to a business in its nascent stages. Silicon valley also provides a favorable advantage when it comes to the tech industry but the truth is that there are several other top startup industries in the Silicon Valley area that have garnered equal attention and reputation. Let us briefly look at the hottest industries in Silicon Valley.

  • FintechFintech or Financial Technology is a form of emerging technology, which focuses on helping financial institutions improve and automate the delivery of various financial services. If you are planning to incorporate a Silicon Valley startup in the Fintech industry then it is one of the most rewarding and rapidly growing industries. In fact, a report by Ernst and Young estimated that the California Financial Technology market was worth $7.1 billion in 2015. In the near future, there will be enormous growth potential for startups in terms of revenue generation in this industry due to the increasing use of Artificial Intelligence in Financial Technology. Today, it is considered as one of the top startup industries in Silicon Valley and some of the highly successful businesses in this sector include Braintree, Varo Money, Brex, Morningstar, Gravity Payments, and Acorns.
  • Big Data – One of the areas or industries that are expected to even grow bigger in the years to come is Big Data. This is also one of the favored industries to incorporate a Silicon Valley startup as the existing market size globally was $41.33 billion in 2019 and its projected growth is $116.07 billion by 2027. This is more so because of early adoption of futuristic technologies like AI (Artificial Intelligence) and Predictive Analysis according to a report by Fortune Business Insights. Some of the top startup industries in Silicon Valley as well as global companies like IBM Corporation, Amazon.com, Microsoft Corporation, SAP SE, Oracle Corporation, Software AG, Infosys Limited, Cisco Systems, and Dell Technologies have been key players in the big data market.
  • Blockchain – The Blockchain technology was first outlined in 1991 and was first implemented in 2009 for transactions being made using bitcoin. It is essentially a public ledger or a distributed database of records that comprises any or all transactions or even digital events taking place and is normally shared among participating entities. The wide variety of applications of Blockchain has attracted many entrepreneurs to incorporate a Silicon Valley startup in this industry. The market size of the global blockchain technology was valued at $3.67 billion in 2020 and is expected to grow quickly. You can register a Silicon Valley startup in the Blockchain industry as it is expected to expand or grow at a CAGR (compound annual growth rate) of 82.4% from 2021 to 2028. It is one of the most promising technologies in the IT domain and is projected to reach $69.04 billion by 2027.
  • AI & Machine Learning – Artificial Intelligence is a big concept and machine learning is a subset of AI and together they are increasingly being applied in a variety of industries and areas including eCommerce, Workplace Communication, Human Resource Management, Healthcare, Cybersecurity, Logistics and Supply Chain, Chatbots, Space Exploration, and Smart Homes. If you are planning to incorporate a Silicon Valley startup in this industry then it is surely going to witness expansion and growth in the near future as market research firms like Tractica believe that Global AI market revenue is projected to reach $118 billion in 2025 while Machine Learning market size will reach $96.7 billion by 2025. The market share in the North American region for AI was $11.40 billion in 2019 while that of machine learning was $2.40 Billion. You can register a Silicon Valley startup as California is considered one of the best platforms for this industry and is home to industry stalwarts like NVIDIA Corporation, Alphabet (Google LLC), Apple Inc., Cloudera, Salt Security, and DeepMap among others.
  • Medtech – Technology is at the heart of most industries today and this includes the medical industry as well. Medical Technology is commonly known as Medtech and it refers to a variety of technology enabled medical products, solutions, and services whose applications are mostly used for diagnosing and treatment of different diseases and medical conditions. Medtech applications can vary from ultrasound scans to high resolution laser machining, nano-medicines, and even electronic health records. The US Medtech market size for medical devices was worth $156 billion in 2017 and is projected to grow to $208 billion by 2023. This industry is an integral part of the US healthcare sector and one of the chosen areas for entrepreneurs to form a Silicon Valley startup. A report by Deloitte consulting revealed that the Medtech industry is well-positioned and geared up for driving the future of the healthcare industry and this is the right time to register a Silicon Valley startup in this industry.
  • Biotech – Biotech is a field of technology where organisms or their products are used primarily for commercial purposes. It is also known as Biotechnology and uses living cells for developing or manipulating products for a variety of purposes including genetically modified food. It is a growth oriented industry that attracts entrepreneurs to incorporate a Silicon Valley startup. In fact, the U.S. biotechnology industry is expected to expand and grow at a CAGR (compound annual growth rate) of 9.2% between 2021 and 2027. This is more so because of its varied applications including in the field of genetic engineering, reducing environmental impacts of industrial processes, DNA fingerprinting, and increased crop yield among others. The US Market Size for biotechnology in 2021 is valued at $105.3 billion and its projected value in 2027 is $952 billion. This is an industry where entrepreneurs can register a Silicon Valley startup as it is considered to be expanding and evolving globally.
  • Cybersecurity – One of the key areas of technology today is Cybersecurity. Its importance lies in the fact that digital attacks of technology driven systems, networks, and programs have become prevalent in recent times and hence, such systems or technology needs to be protected. Cybersecurity is a type of unified threat management system that helps in detection, investigation, and remediation of cyber or digital attacks thus protecting sensitive data or information. Identity theft is one of the most common examples of cyber attack. It is one of the top startup industries in Silicon Valley as the Cybersecurity Market is forecasted to grow from $152.71 billion in 2018 to $248.6 billion by 2023. The North American market was valued at $156.24 billion in 2020 and is projected to reach $352.25 billion by 2026. There are several areas of Cybersecurity where you can form a Silicon Valley startup like Deployment (On-premise and On-cloud), Manufacturing, Public Utility, Retail, IT, Financial Services and Insurance (BFSI), and Banking among others.

Start a new California business in Silicon Valley!

Forming Your Startup in Silicon Valley

Silicon Valley located in the San Francisco Bay Area is home to some of the top technology companies in the world. It is the headquarters of digital giants and other companies like Apple, Alphabet Inc.-Google, Netflix, Wells Fargo & Co., Facebook, Visa, Inc., and Chevron Corporation among others. The “Big 5” tech companies in the Silicon Valley generate revenue of $802 billion, which is more than the GDP of Switzerland and Saudi Arabia.

Since Silicon Valley is one of the major epicenters of technology, innovation, accelerators, and startups; it presents an ideal business platform to register a Silicon Valley startup. Entrepreneurs and innovators have always favored the Silicon Valley startup ecosystem for launching their new ventures and so have venture capitalists and other investors. Let’s take a look at the fundamental requirements for starting a new business in the Silicon Valley region.

Prepare your startup idea and business plan

If you have a genius or innovative business idea then it’s time to incorporate a Silicon Valley startup. One of the first steps towards forming your new business is preparing and developing your startup idea and drafting a business plan. There are certain aspects that you need to consider while developing your startup idea as the business plan will be created accordingly. The most important aspect is to analyze the relevant market.

If you are planning to register a Silicon Valley startup then it is important to compare the markets in the cities situated in the valley like Santa Clara, Menlo Park, Sunnyvale, Palo Alto, Mountain View, Redwood City, and Cupertino. The next step is to execute a market survey in the chosen city and finally, develop your product, service or solution. Once you have defined your startup idea, it is time to create a business plan. There are some core areas that your business plan should focus on and they are:

  • Executive summary: This will include information about your startup and objectives in brief
  • Market analysis: This includes information pertaining to industry research, competition, and launch market
  • Company Structure: The structure of your startup like Corporation or LLC
  • Branding, marketing and sales: This area will focus on modes and plan of advertising, marketing, and selling
  • Product or service: Description of what your product or service is and how will it be beneficial for customers
  • Financial projection and business model: A broad view of the earning potential of your startup and future financial scope
  • Strengths, weaknesses, opportunities and threats (SWOT): A SWOT analysis will provide a realistic view of challenges, bottlenecks, potential threats, and opportunities available.

Networking/connect with industry experts

In this digital age, it goes without saying that the more people you connect with; the better it will be for your business. If you are planning to form a Silicon Valley startup then networking or connecting with industry experts will help further your startup plans or business expansion. Whether your business is currently in an ideation phase or moving towards a minimum viable product (MVP) stage; it is important to connect with industry experts as well as investors through a variety of networking channels and platforms including events, opportunities, coworking spaces, and meetups. The opportunities you can leverage when you register a Silicon Valley startup are:

  • Meetups: One of the best options for networking within the Silicon Valley startup ecosystem is by becoming members of various Silicon Valley entrepreneur groups as they organize both events and meetups. Some of the top groups for meetups are Silicon Valley Young Professionals-SVYP (Santa Clara), Silicon Valley Entrepreneurs Toastmasters Club (Santa Clara), SF Tech Ladies (San Francisco), and Bootstrappers Breakfast – Silicon Valley Startups (San Jose) among others.
  • Events: One of the greatest benefits for aspiring entrepreneurs or first time business owners in the Silicon Valley is the large number of tech and startup events that take place in the region. Some of these events are attended by executives of the top startup industries in Silicon Valley. The events can be categorized under:

    • Inspirational startup events
    • Startup Events on Best Practices
    • Events focussing on Network and forming a team
    • Hackathons
    • Investor Networking Events

Incorporate and register your startup

In most states including California, all you need to form a business corporation is submitting articles of incorporation to the office of the Secretary of State of the chosen jurisdiction. However, if you are planning to incorporate a Silicon Valley startup or a high-growth tech company then the business formation will require much more than simply submitting the articles and bylaws. Some of the aspects integral to Silicon Valley startups are rapid growth, issuance of equity incentives to employees, scaling your business, and creating the ability to take outside investments. So, how are most Silicon Valley startups formed?

A majority of Silicon Valley startups have been formed as corporations and more importantly, they have been incorporated in Delaware. The primary reason for this is that Delaware laws and management are business friendly as opposed to California corporate laws. When you incorporate a Silicon Valley startup in Delaware, it also increases the chances of finding investors and they are familiar with the Delaware laws. Once you have formed in Delaware, you will not be required to re-incorporate anywhere else, which means you are not required to register a Silicon Valley startup but instead apply for foreign qualification.

IncParadise can not only help you to incorporate a Silicon Valley startup in Delaware but also assist with the process of foreign qualification in California.

Secure funding for startup

Every business requires a startup capital; some require higher investments while others can kickstart their business with minimal capital. If you are planning to form a Silicon Valley startup then depending on the industry the startup belongs to, you may need outside funding. The question is, how do you secure funding for your startup?

The good news is that there is a large number of funding resources in Silicon Valley right from angel investors to seed accelerators. One of the key aspects towards securing funding is a strong business plan that encompasses business objectives, strategies, competition, market research, and product or idea that you want investment for. The early-stage startups can approach Angel Investors once they form a Silicon Valley startup. Some of the top angel investors include Adeo Ressi, Alexis Ohanian, Andrea Zurek, Christine Tsai, Eric Reis, and Zachary Aarons among others.

There are also several Angel investor groups, which is essentially a pool of investors pooling their resources together. Some of the big names include Angel’s Forum, F50, Open Silicon Valley Forum, and Sand Hill Angels to name a few. Some of the top startup industries in Silicon Valley have businesses, which have achieved higher growth by securing funding through angel investors in the initial stages.

The other forms of funding available are Growth Stage Funding and Seed Accelerators. The latter accepts teams and not solo founders and the investment may vary from $15,000-$150,000 in exchange for an equity of 6% to 10%. Growth stage funding involves Venture Capital firms that provide growth equity or startup capital to promising ventures.

Looking to register your Startup in Silicon Valley?

Silicon Valley is one of the most economically vibrant, technologically challenging Diaspora of innovation. It is home to some of the biggest tech or IT companies in the world and is considered to be the gold standard for technological advancement. If you have an idea and are planning to form a Silicon Valley startup then we at IncParadise are here to assist you with business formation requirements. We can help you to incorporate and register your Silicon Valley startup, so that you can begin operations at the earliest and maximize your benefits of launching a business in the famed valley.

IncParadise also provides a wide range of additional services like foreign qualification, obtaining an EIN (Tax ID) number and California Certificate of Good Standing among others.

Form your Silicon Valley Startup today!

How to change your California registered agent

Date: | Category: | Author: developers

How to change your California registered agent?

If you are planning to start a small business or if you already have a business that you want to move or expand to the state of California then you will be required to prepare documentation in accordance to the business type and this is an area of expertise for the best California registered agent like IncParadise. There may be an instance where you may need to change a California registered agent due to several reasons. This is a guide that will provide you with an insight into registered agents in California, what they do, and how you can change your registered agent in the state.

Registered Agent in California

A registered agent in California can be an individual or a firm, which is hired or designated by a business entity for the purpose of receiving service of process documents and notices, government correspondence, and different types of compliance-related documents on behalf of the said business entity. Some of the best California registered agents also provide a wide variety of services focused on business requirements like assisting with new business formation or existing business amendments, filing of Statements of Information, and helping obtain California certificate of good standing and federal tax ID among others. Whether you are hiring a new registered agent or planning to change a California registered agent, it is important to understand in detail the responsibilities and benefits you can derive by designating a registered agent.

What is a registered agent in California?

If you are thinking of forming a business corporation or a limited liability company in California, you will be required to designate a registered agent according to the California Business Codes. In fact, according to law, you will have to provide specific information pertaining to your chosen registered agent when filing the articles e.g., according to CA Corp Code § 17702.09 (2019), you have to provide the name and street address of the agent in this state pursuant to Section 17701.13. If you change a California registered agent, you will be required to notify the office of the California Secretary of state of the same.

If you are planning to change your California registered agent then you can opt for a firm, agency or even an individual to whom the office of the California Secretary of State can send business related documents including notices for tax and annual submissions.

Who can be a California registered agent?

The California Business Code dictates that one of the primary California registered agent requirements is that they should maintain a registered office, which should be a physical address in the state and not a PO box number. A California registered agent would also need to keep regular business hours so that they can accept service of process as well as any other legal correspondence on behalf of their clients or entities they are representing. If you had to choose the best California registered agent then who would it be or how would you choose? In reality, there are two scenarios

  • An individual as a Registered Agent where-in you or your company becomes a registered agent but this unfortunately is not an option in California. The state doesn’t allow entities like LLC or owners to serve as their own registered agents.
  • A Commercial Registered Agent is the second option and applicable in California. If you are starting a new business in California, you will need to hire and maintain an RA. If you have an existing business and are not satisfied with the services of your current RA then you can apply to change a California registered agent. So, who is a Commercial Registered Agent? It is an individual or firm or third party that is compliant with the statutory requirements as specified in the California Code-CA Corp Code § 17701.13. A commercial agent is someone who should have represented a minimum of 50 or more domestic and foreign business entities and should have the experience of handling service of process for a period of one year. IncParadise is one of the best California registered agents with experience of handling and representing more than 10,000 business entities across the US including California. We are also fully compliant with the California Corporations Code requirements.

What does a registered agent do?

It is important to note that different states may have different California registered agent requirements as well as processes but the purpose of a California RA will be the same as an RA of any other state. So, what is the purpose of the best California registered agent?

  • The primary purpose of the best California registered agent is facilitating service of process. Service of process is basically a procedure where a party (individual, business, or government) to a lawsuit gives notice of legal action to another party (business entity like an LLC or INC.), so that the said entity can respond to the proceedings before the court. A registered agent can accept the notice or legal documents on behalf of the party being served the notice pursuant to 416.10 of the California Code of Civil Procedure (CCCP).
  • When you change a California registered agent then they will fulfill certain secondary purposes as well such as providing the business with a legal or physical address in the state. This is quite beneficial for non-US residents or those running a business in California while being based in another state. A physical address also means that notices and government or business documents can be received by the agent’s office during normal business hours as specified by the California Corporations Code.
  • The type of services the best California registered agent provides can vary from one agent to another but some of the top agents like IncParadise provide a multitude of services depending on the requirement of a business entity. Most commonly, a top California registered agent provides new business formation including that of LLC and corporation apart from ensuring businesses are able to maintain their annual operating compliance with the state.

How Do I Change My California Registered Agent?

There are several reasons why a business would want to change a California registered agent with the most common reasons being:

  • The number of business centric additional services offered
  • Professionalism and credibility of the agent
  • Handling of both domestic and out of state (foreign qualification) business
  • Providing detailed information and guidance towards business requirement fulfillment

There could be many more reasons and once you have decided to change your agent, you need to find the best California registered agent service, which can fulfill all your business requirements. So, let us look at the process that you have to undergo to successfully change your agent in California.

1. Select a new registered agent

The first step towards changing your registered agent is finding the right RA. You need to identify an individual or firm that can provide service of process and also represent you in California. If you are thinking of the cost of change of California registered agent then it is minimal. There are no state filing fees but there will be a change of agent fee. If you are searching for a new registered agent then here are some tips:

  • Compliance: One of the primary factors that govern the choice of most business entities is compliance. It is important to ensure that your chosen RA meets all California registered agent requirements of the state and California Corporations Code. IncParadise is not only state compliant but also meets all state and law based requirements in California.
  • Regular office hours: One of the primary California registered agent requirements is maintaining regular office hours so that any legal notices and business documents can be received by them on behalf of their clients.
  • Physical Presence: A physical presence in terms of a business address is required by law. This helps businesses where owners reside outside the state. For example: If you reside in Michigan and want to operate a business in California, you will need a physical address. Some of the best California registered agents can provide you with a physical address in the state thus ensuring state compliances are met.
  • Evaluate their services: If you are planning to change a California registered agent then you need to evaluate what services they are offering. One of the best California registered agents like IncParadise is a leading registered agent service provider in California because of the variety of business related services offered right from new business formation to obtaining tax ID, and filing of annual reports.

2. Notify your previous registered agent

If you are planning to change a California registered agent then it is important that you notify your previous registered agent of the same. Some businesses may think that removing an agent may lead to loss of credit but that will not be the case. At the same time, when you cancel the services of your previous registered agent, the agency or firm will require a confirmation of the fact that their name is not listed in the California state records as your registered agent. In such a scenario, all you need to do is provide a copy of the “change of agent” filing along with the entity records from the SOS website.

3. File California Statement of Information to the California Secretary of State

As a business entity wanting to change a California registered agent, you may ask, if there is any form that is required to initiate this process in the state of California. Actually, you are not required to file any form but have to simply inform the office of the Secretary of State. In fact, if your business is a domestic or foreign stock corporation or an LLC then you will have to file a “Statement of Information” while other business forms like limited partnerships or general partnerships have to file a statement of amendment. The purpose of the Statement of Information is to update the new agent information in the state records.

Want to Change your California registered agent?

Cost of Changing a California Registered Agent

There is no extra cost of change of a California registered agent except for the fee for filing the Statement of Information and the fee for new agent services, where the latter will vary from one agent to another.

If you hire IncParadise as your registered agent to represent you in California then you can avail of a special deal for Registered Agent Change – $119 for one year, which includes registered agent service for $89 and $30 filing fee required by the state of California for change of agent. We also offer a special package if you order our registered agent services for 2 or 3 years. If you opt for 2 years then the registered agent service will be available for $89 for the first year and $40 for the second year. If you opt for 3 year service then it will be available for $89 for the first year and $40 for the second and $40 for the third year.

Choose IncParadise as Your California Registered Agent

If you are planning to form a new business or thinking of expanding your existing business to California; the state and business laws make it mandatory for entities to hire and maintain a registered agent in the state, especially to handle service of process. If you want to change your California registered agent then it is also important to note that the new or chosen agent should have a physical presence in the state in the form of a physical address and not just a P.O.Box number. IncParadise, one of the best California registered agents and adheres to the regulations established by the office of the California Secretary of State.

We are one of the leading registered agent service providers in California, and we can help you with the process to change your California registered agent. As your registered agent in the state, we will accept the service of process and any other communications including receiving legal, official, and business documents as our experienced staff maintain normal working hours. We also provide a secure online account to all our clients for enabling access to email notification for renewal of registered agent services in California.

Choose Our California Registered Agent Services for your businesses today!

Foreign Qualification in California

Date: | Category: | Author: developers

Foreign Qualification in California

California is one of the strongest markets for new businesses and is backed by robust infrastructure and a continuously growing economy. If you already own a business outside the state and want to expand your market and reach the San Francisco Bay Area then your company will have to undergo foreign qualification in California. This article will focus on certain key areas of California foreign corporation registration or LLC registration by providing relevant information on how the California foreign qualification process really works.

California Foreign Qualification

The state of California is home to approximately 4.1 million small businesses including domestic and foreign entities and is considered the primary drivers of economic growth. One of the reasons to establish foreign LLC in California is that the state provides a business platform that encourages new investment while reducing the overall cost of making a business operational. This has been made possible through the implementation of various incentives, programs, and zones like the California Opportunity Zones, Foreign Trade Zones (FTZ), and financing programs among others. A California foreign LLC registration will enable you to access the incentives and programs and also open the doors to apply for several grants thus reducing the initial cost of setting up your foreign company.

What is California foreign qualification?

Foreign qualification California refers to the registration of your new business with the office of California secretary of state. Once you are foreign qualified, you will be able to operate your business legally and pursue any growth opportunities within and across the state borders without the need for incorporating or forming a new business entity. The process of California foreign corporation registration is considered as the first step towards expanding your existing business to California or any other state.

The process of registering foreign corporations in California or foreign LLC may be different from that of other states and the regulations are governed by the 2019 California Code, Corporations Code. Let’s look at an example to understand this:

If you have formed a domestic LLC in Texas then it will be considered as your home state. Now, if you plan to expand your operations to California then you will be required to apply for California foreign LLC registration governed by CA Corp Code § 17708.02 (2019) so that you can foreign qualify and make your LLC operational in the state.

Along with the foreign qualification in California, you will be required to apply for and obtain business licenses or permits, hire and maintain a California registered agent like IncParadise, and also maintain annual compliances as required by the state of Texas as well as California.

Doing business in California

The type of business you are planning to form will be governed by Title 1 and Title 2.6 of the California Code e.g., foreign corporations in California are governed by Title 1, Division 1, Chapter-21 of the California Code. If you are wondering what doing business in California really means then it simply refers to the practice of conducting business activities or transacting business of a company in the state of California when the said company was actually incorporated or formed in another state. In such a scenario, California foreign corporation registration will be necessary.

According to the California Franchise Tax Board (FTB), your company will be considered to be “doing business” in California if you are executing any of the following:

  • If your business engages in any form of transaction for the sole purpose of achieving financial gain or profit within the state of California
  • If your company is organized or has been commercially domiciled in California
  • If your California sales exceed the threshold amount or 25% of total sales is more than $610,395
  • If your California real and tangible personal property exceed $61,040
  • If your California payroll compensation exceeds $61,040

Let’s look at an example to understand this:

A business corporation ABC Inc. is an out-of-state corporation that sells tangible goods through e-commerce and qualifies for protection under Public Law 86-272 (15 USC Section 381). In the taxable year 2020, Corporation ABC Inc. has recorded sales of over $1,000,000 but has no payroll or property in California. Such a Corporation will be considered to be doing business in California although due to protection under PL 86-272, it will not be subjected to California franchise tax.

California Foreign Qualification Process

If you have an established business in any other state like Delaware or Wyoming and want to expand your business activities to California then you will need to undergo foreign qualification
in California. The process for foreign qualification will vary according to the type of business. For example, California foreign LLC registration and fee will be different from that of a corporation. The California foreign qualification process is important and failing to foreign qualify can lead to penalties and prosecution. An entity may be subjected to a penalty of $20.00 per day for unauthorized intrastate business transactions. The entity may even be prosecuted by the California Attorney General and such an entity may be required to pay an additional penalty.

California Foreign Corporation Registration

If you are planning to form a foreign corporation in California then you will need to obtain a certificate of qualification from the office of the Secretary of State. This certificate permits an entity to transact intrastate business. The following steps will help you to identify the requirements for California foreign corporation registration.

  • Name Registration: The first step towards foreign qualification in California is to choose a name and check availability. If the chosen name is available then you will need to register the corporate name with the office of the Secretary of State, Business Programs Division, pursuant to CA Corp Code § 2101 (2019). The fee for registration of a corporate name is $50. You will be required to also file a “Submission Cover Sheet” along with the name registration paperwork. If the chosen name of the foreign entity is not available for use in California then the entity will have to qualify using an assumed name.
  • Registered Agent: An important aspect of California foreign corporation registration is designation of a registered agent for the service of process pursuant to CA Corp Code § 2102 to 2105 (2019). You can hire IncParadise as your California registered agent as we possess experience and expertise in foreign qualification in California and can help you qualify for the same.
  • Certificate of Good Standing: It is also known as the certificate of existence or entity status letter depending on the state your corporation is registered in. You will require a Certificate of Good Standing from your home state or state of incorporation and will be submitted along with foreign qualification in California paperwork.
  • Foreign Corporation Qualification: If you want to apply for California foreign corporation registration by yourself then you need to download, fill, and submit the Statement and Designation by Foreign Corporation form. It has to be submitted with the office of the California Secretary of State. You have to submit a current Certificate of Good Standing with the form along with a fee of $100 for foreign stock corporations.

Do you want to form a California Foreign Corporation?

California foreign LLC registration

Are you thinking of setting up a foreign LLC in California? If yes, then you will need to obtain a certificate of registration from the office of the Secretary of State. This certificate permits the foreign limited liability company to transact intrastate business. The following steps will help you to identify the requirements for California foreign LLC registration.

  • Name Registration: The first step towards foreign LLC in California registration is to choose a name and check if it is available. The chosen name should be distinguishable in the SOS records from names of other limited liability companies in the state. If the chosen name is available then you will need to register the LLC name with the office of the Secretary of State. A name reservation is not necessary for California foreign LLC registration but you can apply for the same with the office of the Secretary of State pursuant to CA Corp Code §17701.09(a) and CA Corp Code § 17708.05 (2019). The LLC name can be reserved for a period of 60 days and the California SOS will issue a certificate of reservation for the same.
  • Registered Agent: An important aspect of foreign LLC in California registration is designation of a registered agent for the service of process pursuant to CA Corp Code § 17708.02 (2019). IncParadise can be your California registered agent as we have the expertise and experience towards ensuring help with your California foreign LLC registration.
  • Certificate of Good Standing: It is also known as the certificate of existence or entity status letter depending on the state your corporation is registered in. You will require a Certificate of Good Standing that has been issued within 6 months by a government agency in the state of formation. The certificate has to be submitted along with foreign qualification in California paperwork.
  • Foreign LLC Qualification: If you want to apply for foreign LLC in California qualification by yourself then you need to download, fill, and submit the Application to Register a Foreign Limited Liability Company (Form LLC-5). It has to be submitted with the office of the California Secretary of State. You have to submit a current Certificate of Good Standing with the form along with a fee of $70. You can also avail of expedite services for California foreign LLC registration that are valid for documents being submitted in person (drop off) to their Sacramento office. There is an additional non-refundable $15 fee for counter drop off.

Do you want to form a Foreign LLC in California?

Need Any Assistance in Applying for California Foreign Qualification?

If you already have an LLC or corporation in any other state and if you are planning to expand to California then you will need to undergo the process of foreign qualification in California. As one of the leading registered agents in California, IncParadise can assist you with the process of California foreign qualification and also assist you with the process of incorporation in California.

We can also help you to acquire a Certificate of Good Standing from your home state and provide you with additional services that will ensure you are in compliance with all requirements pertaining to foreign qualification in California. We also provide foreign qualification services in all 50 states, which will make it easier for you to expand your business across all 50 states in the USA.

Want to apply for California foreign Qualification?

Forming California company as a Non-Resident or Foreigner

Date: | Category: | Author: developers

Forming a California company as a Non-Resident or Foreigner

California is the home to the technology revolution of the 21st century and entrepreneurs and businesses in the state have been responsible for creating 1.5 million new jobs since 2009. The state has an ever-evolving technology sector but that is not the only industry where you can start a company in California as a foreigner. If you are a non-US resident and want to form your startup in California then it is very possible. The process to start a US business for foreigners is similar to the process to register a California business domestically except for a few regulations and requirements that you need to be compliant with. This article will guide you through the requirements for forming a California company as a foreigner.

Starting a Company in California

There are 4.1 million small businesses based in California today and stand among the top ten largest economies in the world. In 2019, the gross domestic product (GDP) was approximately $3.14 trillion with foreign direct investments controlling ownership in several businesses in the state. Entrepreneurs from several countries find it attractive to start a company in California as foreigners with Japanese entrepreneurs and firms leading the table with 3,880 firms followed by the UK at 2,303 and France at 1,888. You can also choose to register any type of business entity like LLC, professional corporations, limited partnerships, and other business entities and the California business environment will ensure your startup gets the initial positive thrust it requires.

California business or startup environment

The California business environment and startup ecosystem is different from that of any other state and this makes the state unique in terms of forming your first startup. As an entrepreneur in California, the business environment ensures strong economic growth but there are certain elements of the ecosystem that work together to aid in business growth. Some of the top elements are:

  • It is an economy that grows constantly and consistently – One of the top reasons to start a business in California is the trillion Dollar economy, which is still growing at a steady pace. Today, California is considered as the Sixth Largest Economy in the world and accounts for almost 13 percent of the US output. The economy is extremely diversified and not dependent on any single industry. The single largest industry sector in this state is services and includes computer and software design, engineering, and motion picture production among others. Some of the other sectors driving the California economy include finance, export or trade, manufacturing, and tourism. The economic activity also differs from one region to another. For example, the key industries in the San Francisco Bay Area are High-tech manufacturing and Software development while key industries in Southern California are Motion pictures and tourism. These are some of the elements driving the strong economy and enabling the functioning of a robust California business environment.
  • Foreign Trade and Trade Zones – One of the areas that attract entrepreneurs to start a company in California as a foreigner is foreign trade. California exported to approximately 227 foreign markets like Japan, Canada, Mexico, China, and South Korea in 2020. The exports from California in 2020 were $156.1 billion and that accounted for 10.9% of the total U.S. exports. Foreign direct investment (FDI) in the state was approximately $45.49 billion in 2019 and the top industry sectors for FDI are business services, industrial equipment, software & IT services, financial services, and communications. California is also home to the highest number of small and medium-sized enterprises (SME’s) in the trade sector including exports and imports. One of the salient aspects is the Foreign Trade Zone (FTZ), which is a key element in creating a high-end California business environment. The FTZ is responsible for providing exporters, importers, distributors, and manufacturers with opportunities that help in reducing U.S. Customs duties and for deferring payment until their product leaves the foreign trade zone. One of the top foreign trade zones is the City of Industry in Los Angeles County.
  • California business or startup environment – California has been a leader where innovation and knowledge-based economy is concerned and it is home to several successful global companies that are globally renowned for entrepreneurship and creativity. The State launched the California Innovation Hubs (iHub) Program in 2010 with the primary objective of leveraging convergence between incubators, stakeholders, and investors for propelling startups towards growth and success. California Innovation Hubs (iHub) Program is one of the most advanced and forward thinking programs that ensure you can start a company in California as a foreigner and enjoy its many benefits. The iHub has helped in creating a robust innovation-based economic development support network across the state. There are 16 iHubs that have been responsible for making the California business environment highly creative and vibrant. Some of the top iHubs include the Sacramento iHub, iGATE iHub, CalValleyTech iHub, iHub San Joaquin, San Jose/Silicon Valley ET iHub, and Innovate North State iHub among others.

Steps to Form a California Company as a Foreigner

If you are an entrepreneur thinking if it is possible to start a company in California as a foreigner then the answer is yes. The second most important aspect is restrictions and California does not impose any kind of restrictions on entrepreneurs or startups registered in the state. It is important to note that the regulations and documents required to register a California business as a non-US resident would be quite similar to that of a foreign company. Let’s take a look at the various processes and steps that you need to take to successfully establish your business as a foreigner in California.

1. Prepare your California business plan

Every business needs a plan before they can actually start a business in California and this holds true for non-US resident entrepreneurs and business owners. A strong business plan can take a new business towards success and a weak business plan can lead to bottlenecks and problems. A business plan is essentially a business roadmap that contains the primary and secondary business objectives as well as strategies.

A business plan provides a long view of where your company is, where it is expected to go, and how it will get to that point. This type of business roadmap provides a bird’s eye view of several aspects like the capacity (time and resources) of each team, individual contributions, fundraising, growth-related initiatives, infrastructure and improvements among others. What does a strong business plan entail? If you want to register a California business as a foreigner then a business plan should focus on the following areas:

  • Vision and Mission Statement
  • Executive Summary
  • Company Description
  • Long-Term Goals
  • SWOT Analysis
  • Competition and Market Analysis
  • Breakdown of Products and Services
  • Marketing Plan and Sales Strategy
  • Financial Projections and Funding

2. Secure business funding

If you are planning to start a company in California as a foreigner then there may be higher initial costs depending on the type of business activity like an IT firm will need investments in tech equipment. The thumb rule is that it will cost money to start any type of business and the expenses include cost of registration or incorporation in the state along with obtaining licenses and permits.

Securing funding is one of the most important and key financial choices that you will have to make as a foreign or non-US resident entrepreneur. It is important to note that the funding opportunities chosen will affect the structure and the operations of the business. Some of the funding opportunities that you can benefit from before you register a California business are:

3. Choose a company name

A business name is as important to your business as are your customers because a customer can relate your business name to the product or services offered by your company. In a way, a business name can help in creating an excellent first impression hence it is important to choose the right name before you start a company in California as a foreigner. When choosing a business name, it is essential to ensure it is unique but not a tongue twister.

Once you have chosen a name, it is recommended that you search for name availability in the California SOS database. According to the California Secretary of State, you will need to reserve the chosen name for a period of 60 days and should be distinguishable in the records from any other business name. Since you are planning to register a California business as a foreigner or non-resident, you will have to register the business name in compliance with California Corporations Code Section 2101.

4. Choose a business entity

If you have decided to start a business in California as a non-resident or foreigner then the primary consideration should be the type of business entity you want to form. The different types of entity you can form in California include:

The type of entity you want to register as a California business will depend on your specific requirements and what you are planning to achieve. Each type of business has its advantages and disadvantages, risk areas, and rewards. Some of the factors that will help you to choose the right entity include:

  • Cost of new business formation or start up costs
  • Taxation
  • Continuity and Transferability
  • Liability and Asset protection
  • Sharing of profits

5. Choose a Registered Agent

One of the primary requirements in the state of California for new businesses is hiring registered agent services. This is especially true if you plan to start a company in California as a foreigner. If you were to form a foreign corporation then it is mandatory to designate a registered agent for the service of process pursuant to CA Corp Code § 2102 and 2111 (2019). A California registered agent is also known as an agent for service of process and is appointed by a company mainly for the purpose of accepting all types of official correspondence and legal notices. A registered agent like IncParadise will not only handle service of process but can help you register a California business and also provide other business related services. IncParadise is one of the leading registered agent service providers in California today!

6. Register your company with California Secretary of State

There are several processes that you have to undergo in order to start a company in California as a foreigner. The first and foremost is registration of your business with the California Secretary of State. If you are a non-resident planning to register a California business then you will need to apply for foreign qualification. The type of registration will be dependent on the type of entity.

Entities like foreign corporations will be required to file a certificate of qualification pursuant to CA Corp Code § 2106 (2019) while foreign LLCs will need to file a certificate of registration with the Secretary of State pursuant to CA Corp Code § 17708.02 (2019). IncParadise, one of the top registered agents in California can help you with the process and filing your California company registration. You can order new LLC or INC online right here – right now and thus save valuable time.

Planning to start your new business in California?

7. Get EIN

If you are a Non-U.S. citizen and are planning to start a company in California as a foreigner then you will need to apply for and obtain an Employer Identification Number (EIN) without the need to have a Social Security Number (SSN). The EIN is a 9-digit unique identification number and is also known as a Federal Tax Identification Number (FEIN). You have to apply for the EIN with the Internal Revenue Service (IRS) and have to obtain it before you register a California business as a non-US resident. Since you will be incorporating or forming your new business in the US; EIN can be applied for online.

8. Open a bank account for your business

It is always recommended to open a business bank account if you are planning to start a business in California as a non-resident. A business bank account also known as a Business Checking Account will keep your business income and expenditure separate from personal income and expenses. This will also help you to manage expenses and file taxes. You can refer to our bank account opening guide to understand how business banking works in California or the U.S.

Each bank has its own USP and advantages like some banks offer night depository services and a minimum opening balance of just $100. Each bank also has their own set of requirements but some of the common documentation required by Non-US residents for a business bank account includes:

  • Certificate of qualification or registration
  • Federal Tax ID Number (EIN)
  • Proof of address
  • Photo ID (such as a valid passport)
  • Copy of the Business License

9. Obtain necessary business licenses and permits

You can start a company in California as a foreigner in a variety of sectors but you will need to obtain a business license or permit first. Applying for and obtaining a business license basically means that you have the permission to operate your business or transact in the state of California. There is no separate requirement for non-US residents when applying for a business license except that you may require a single or multiple licenses depending on your business activity and location. Once you register a California business, you can apply for any of the following licenses:

  • A general business license
  • Business license/permits for specific industries
  • County business licenses

You can also opt for our “Business License Research Report” service, which is an in-depth informative report that contains a list of filing instructions, license types, supporting documents required, and fees for business licenses and permits in California.

10. Know about the annual and ongoing state filing requirements

Once you start a business in California as a non-US resident, you will need to maintain it and ensure all annual requirements are met. This will help in keeping your business status active while helping you avoid any penalties or fines for non-compliance or late filings. Different types of business entities have different annual and ongoing requirements and some of them are:

  • Name registration renewals
  • California business license or permit renewals
  • Statement of Information – Initial and Biennial
  • Franchise tax
  • State Business Tax
  • State Employer Taxes

Looking to Start a Company in California?

If you are planning to start a business in California as a non-US resident, you will require California registered agent services to help you with the formation or incorporation of your new business. IncParadise is one of the top California registered agents and we have helped thousands of companies to register a California business.

We can be your registered agent in the state of California and help you with all your annual and ongoing requirements so that your business meets all state compliances. We also provide many other additional services like EIN assistance, and S corporation filing among others.

Start a California Company as non US residents Today!

California Small Business Grants

Date: | Category: | Author: developers

California Small Business Grants

It is often difficult for startups and small businesses to fund their business operations. They are thus offered some form of financial help like loans and Small business grants in California. These can help startups to establish their operations and grow without having to mortgage anything at all unlike loans. This type of grant constitutes a small amount of seed money that may be for fulfilling specific purposes like encouraging entrepreneurship.

Doing Business in California

The California economy is the largest in the US with the gross state product at $3.02 trillion. It is also considered as the 5th largest economy in the world with the San Francisco Bay Area recording a GDP of $535 billion. It is home to more than 4 million small businesses spanning a huge variety of industries including 69,387 small business exporters. These numbers are astounding but the fact is that there are many startups that have climbed to the high growth stage with the help of small business grants in California. It is one of the most competitive markets in the US and the world and as a small business; you may need extra funds in the early stages of the business operations. This is where the new small business grants in California can provide the much needed relief.

Why do startups and small businesses prefer doing business in California?

California has been one of the favorite destinations for startups and small businesses since the mid-1960s and in the 1990’s it became famous for Silicon Valley, which was the epicenter of innovation in software, internet, user interfaces, and computer operating systems. It is not just the California economy that attracts entrepreneurs but also some of the opportunities that enable the creation of a pro-business environment. Some of the factors are:

  • Networking: California is the home to several business opportunities and this is made possible through hundreds of events, trade shows, and conferences that keep taking place in the state throughout the year. These events provide the perfect platform for new as well as existing businesses.
  • Grants: Every business needs funding for their business operations but there are times when an entrepreneur may have a great idea but no funds. The small business grants in California programs provide funds to such businesses.
  • Industries: There are several different sectors or industries in which you can start your new business. Some of the fastest-growing industries include construction, healthcare, services, technology, agriculture, hospitality, tourism and the film industry.
  • Talent Pool: One of the most important aspects of a new business apart from startup grants in California is the talent pool. The talent hired by a business eventually helps the business to achieve its marketing, sales, or financial objectives and California has a deep talent pool. California is home to some of the top universities in the world including Stanford, Caltech and UCLA.

CA Business Portal State Incentives, Tax Credits and Funding

Although a CA small business relief grant can be a boon for any startup, there are several other options that can help a new business financially like federal, state and local incentives. California has a strong incentive program for small businesses and you can choose from incentive categories by industry, business operation, and type. The California relief grant program is also an integral part of the business incentive program.

Incentives by Industry

In California, you can start a new business in just about any industry with the help of a CA small business relief grant. Each industry markets a different product or service and hence the type of incentive required would be in accordance to the type of industry although there are some general incentives that are useful for businesses in any industry like California relief grant program and tax credit or exemption programs. The incentives for small businesses are categorized according to the following industries:

  • Advanced Manufacturing
  • Agricultural/Timber Industry
  • Biotech/Health Care
  • Energy and Environment
  • Film and Television
  • Food Processors
  • Manufacturing
  • Recyclers
  • Transportation

Some of the incentives are common to multiple industries. For example, the Sales and Use Tax Exemption Program can be benefitted from by startups in the advanced manufacturing industry as well as Agriculture, healthcare, energy, and manufacturing industry.

Incentives by Business Operation

Business incentives like the small business grants in California have a two pronged benefit as they help startups with financial aid through tax exemptions and training programs among others. Simultaneously, the business incentive programs like Opportunity Zone program and Foreign Trade Zones help the state to attract small businesses and startups. In California, you can apply for an incentive program based on the type of business operation. For instance, you can apply for a California relief grant program for the purpose of Business Expansion or Facility Improvements. The incentives for small businesses categorized by business operation include:

  • Workforce Development Programs
  • Business Expansion or Facility Improvements
  • Hiring & Training Programs
  • Startup or Small Business Support Programs
  • Export-Import Business Programs
  • Utilities
  • Recycling

Some of the above programs are driven towards fulfilling a specific requirement of a business. One such example is the “California Infrastructure and Economic Development Bank Export Financing Program” that provides loans to startups or small businesses selling manufactured products to other countries. Similarly, a program like the Work Opportunity Tax Credit (WOTC) is a federal incentive program for employers hiring individuals from specific target groups such as veterans.

Incentives by Type

The key objective of an incentive is to address the existing or future requirement of a small business . For example, the CA small business relief grant program has been designed to help businesses impacted by COVID-19 to provide financial aid varying between $5,000 and $25,000 to eligible small businesses and is granted by the Governor’s Office of Business and Economic Development. You can also choose to apply for an incentive program based on type of program category, which are:

  • Bonds
  • Loans
  • Grants
  • Tax Credits and Exemptions
  • Utilities

If you were searching for a grant then the new small business grants California program would be ideal but if you are looking for a loan then the Small Business Loan Guarantee Program would be a better option.

Financing opportunities

If you are an entrepreneur or are planning to start a new business in California then you may require initial funding to help with your business growth and scaling plans. Business industry experts and insiders believe that one of the primary causes of startup failure is lack of capital in the starting phase or in the business development phase. This is where state based financing opportunities can be quite beneficial like the small business grants in California, which can provide your business the necessary thrust. Financing opportunities in the state can be classified under:

  • Agriculture
  • Business Expansion/Facility Improvements
  • Green Business/Clean Tech
  • Exporting/Importing
  • Startup or Small Business Support

This basically means that if you were planning to form a new business in an industry where you require transportation vehicles then you can avail financing opportunities through facility improvements programs, small business support programs, and even green business programs. At the same time, you can also opt for the startup grant in California to provide you with extra financial support.

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California Grants Portal

The California Grants Portal is one of the best places to find small business grants in California. Whether you are a new business planning to bring your ideas into reality or an existing business thinking of growth and expansion you can find a variety of grant or loan opportunities here.

About California Grants Portal

The California Grants Portal is managed primarily by the California State Library and provides a wealth of information on different and active California relief grant programs. The Grant Information Act of 2018 (Stats. 2018, Ch. 318) authorized state agencies like the California State Library to make all information pertaining to grants for small businesses to be available over the Internet.

As a result, the California Grants Portal was launched in July 2020 to cater to entrepreneurs and business owners seeking grants. You can search the portal for CA small business relief grants as well as other grants based on the agency offering it, categories like science & technology, and disbursement method. There are currently 125 grant opportunities on the website with available funding of $20.5 billion. Let’s look at an example to understand this:

A new business like ABC Inc., is searching for small business grants in California using the California Grants Portal. They go to the find grants section and provide their specific requirements like any agency, business or individual for applicant, education, science, and technology industry category, and any disbursement method then they will get the following grants:

  • Sales Tax Exclusion (STE) Program
  • Monarch Butterfly and Pollinator Rescue Program
  • WHALE TAIL® Competitive Grants Program
  • Regional Conservation Investment Strategies (RCIS)

ABC Inc., can choose the Sales Tax Exclusion (STE) Program as this startup grant in California offers sales and use tax exclusion on purchase of equipment by manufacturers. The total estimated available funding is $100,000,000 and the funding method is through advances & reimbursements. In order to apply for the grant, they will have to submit the application with the grantor’s office, which is the State Treasurer’s Office.

Other Recent Funding Opportunities Published in the Local State

Every year, the state of California as well as the Federal government creates and implements small business grants in California so that small businesses can benefit from it. A surprising fact is that the federal budget concerning government grants is in excess of $90,919 million with additional local government funding amounting to $61,971 million. Some of the recent opportunities that exist for small businesses in terms of state funding are from a variety of sectors like education and training to innovation and conservation. For example, the Conservation Innovative Grants Program for the agriculture, environment, and natural resources sector offers a funding of $150,000 for eligible applicants. There are several other startup grants in California available through the recent funding opportunities including:

  • Cooperative Ecosystem Studies Unit, Californian CESU – Funding amount of $48,000 (G20AS00048)
  • Cooperative Ecosystem Studies Unit, Californian CESU – Funding amount of $25,000 (G20AS00078)
  • Cooperative Ecosystem Studies Unit, Californian CESU – Funding amount of $54,000 (G20AS00065)
  • INRMP Support Ft Hunter Liggett & PRFTA, California – Funding amount of $89,987 (W9126G 20 2 SOI 4876)
  • 2021 NOAA California Bay Watershed Education and Training (B-WET) Program – Funding amount of $100,000 (NOAA NOS ONMS 2021 2006749)
  • Head Start/Early Head Start Grantee-Communities in the state of California – Funding amount of $59,527,092 (HHS 2021 ACF OHS CH R09 1860)

Ready to Start Business in California?

It is never an easy decision to start a new business as making a startup fully functional entails several processes right from creating a business plan to applying for small business grants in California and eventually filing of formation or incorporation documents. The process doesn’t end here as a business has annual maintenance requirements and should remain compliant with all California state laws and regulations. This is where IncParadise has its expertise and experience. We are an expert incorporation service provider in California and can help you to start your business in the state.

IncParadise also offers a range of additional services as we understand businesses need to maintain active status and hence, we can help you with all your annual filing requirements like the annual report. Some of our additional service areas include helping you obtain a Tax ID number, and S Corporation status election among others.

Form a California new business today!