I was first in Taiwan for my grandpa's funeral. It was a short (20 hr) bittersweet trip. Although sad to see him like that and sadder to see how broken up everyone was, it was amazing to hear some of the stories about him and how he touched so many people's lives. I also got to meet relatives I never knew before.
Went on to Indonesia to spend a week with my cousin. She's just recently gotten certified as a scuba diver and I was excited to try to help introduce her to the underwater world. We spent 5 days doing the beach thing in Central Sulawesi at a German-run place called Prince John Resort in Tanjung Karung, and then decided to "rough it" a bit by going out to a remote national park. It was definitely an adventure and merits its own blog entry. I'll post it later :)
Then back to Taiwan for my high school best friend's wedding. I was the best man, but I think I actually took the duty more seriously than my friend! Typical exchange -- Me: "Hey K, what's going on with the rehearsal?" K: "Um, rehearsal?" It was in a gorgeous location, Taiwan's northeast coast, at a resort called the Leo. Other than some thunderstorms that interrupted the reception dinner at inopportune times, things went well. The afterparty went on pretty late and I didn't go the distance because we had an early morning flight the next morning and Sarah decided to call it a night early.
I came back to Shanghai ready to get a jump on the business again, and checked in with my assistant/intern as soon as I got back. She had two pieces of unwelcome news. First, the two local Chinese companies that I had met with before leaving and had counted on to be my subcontractors had both backed out. We had good meetings and I thought that they were both onboard to do the environmental testing for us. So it was a bit of a shock to find out how they had responded to the letter I asked my assistant to write to them. One company contact seemed impatient, like he couldn't be bothered to provide us the information we were asking for. The other guy, a young manager that I got along well with (we were both former military), inexplicably said that he had heard we had contacted many companies and didn't want to do business with us. Very disappointing news.
Then to pile on to this, my intern, H, who has been invaluable in every aspect, but mainly in dealing with translations and business development with Chinese partners, informed me that her Ph D advisor was putting her on a full-time project in Wuhan in a week and she'd be unavailable to continue with the project. Not good news.
So, that was the two steps back. Within the first couple of days after I returned, though, I did make some progress. I met with the website designing company and we hashed out a plan. Since the website is such a big part of marketing and customer education (and demand creation), I was happy to have a plan in place. For $1500, I'll be pretty happy if we can pull this off without too many complications. Second, I was able to get some more information on incorporation. Registering my company is actually a pain in the ass. In the US, you can easily incorporate for a couple hundred dollars. In China, it costs about $2000-10000, depending on what agent you use and where you incorporate. Also, many WOFEs (wholly owned foreign entities) first incorporate in Hong Kong and then make that holding company the parent company registered for the China WOFE. This is to givev more flexibility around changing equity ownership and in moving money around. However, this is an additional ~$2000 to setup and an additional ~$500/yr to do the accounting/tax filing, even if you don't even run money through the HK entity. So, I had to figure out whether the pros outweighed the cons. Usually, the best way to get answers is to ask potential consultants or agents who are hungry for your business, so I talked to about 5 of them, plus an accountant. I was left more confused than when I started. What complicates things is that since I'm a US citizen, the IRS taxes me on my global income. So, for most people, it makes sense to move profits to HK in order to lower their tax bill. However, as far as I can tell, it really doesn't matter if you're a US citizen because you have to report global income from dividends no matter where they're distributed. There's probably some way to game the system, but my tax guy in the US is a pretty straight shooter and won't tell me.
Anyhow, still a work in progress -- hope to have our first customers in about 3 weeks.
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