Tale as old as time.

It all starts with one person and a game-changing idea. They may or may not find a co-founder before venturing into the world and building a tech startup.

But things are never this easy in Latin America, now, are they?

Founder wasn't born rich. A little bootstrapping was good, but it could only take them so far. Quickly introduced to pesky little concepts such as capital runway and burn rate, to figure out a way to raise money to get to the point where they make money. It's time to start knocking on investors' virtual doors.

Founder sets out to talk to angels because they have the most in common. Many Zoom meetings later, they finally find someone that will consider cutting them a check for $100k.

But get this: Founder is building a startup in Brazil, and their potential investor has some conditions. The company needs to be incorporated in a trusted jurisdiction, which is legalese for "not in Latin America".

And that's when Founder starts running into some harsh truths: 8 out of the 15 most prominent venture capital firms in the world are based in the US; sure, there are still local investors, but their pockets just aren't as deep, and even some of them are not keen on investing directly in LatAm. Founder will need to speak to dozens, maybe hundreds of investors before getting a single term sheet, and they can't afford to rule out VCs based on geography.

But VCs can and will rule out founders for a multitude of reasons. One of the most common ones is their corporate structure. If a company is only set up in a country with unfamiliar laws and liabilities, they'll either get the chop or be made to jump through hoops to change their corporate structure. It really is that simple. Startup investments are already risky enough without adding another layer of unpredictability.

And so the Founder is faced with the task of setting up internationally because that will tilt the odds in their favor. $100k can sound like a lot of money, but it's not enough to justify setting up as a Cayman Sandwich yet. They need an affordable alternative.

According to Google, Delaware is all the rage, and so that's what they choose to go for. With a 'where' in mind, they still have no idea about the 'how'. Should they set up a C-Corp? Would an LLC be better suited? The research has yet to produce answers that are tailored to their specific case, so they start seeking legal advice.

As they talk to lawyers to figure out the best course of action, they quickly learn that: a) the average lawyer has no idea how to advise LatAm startups on incorporation; b) lawyers who know their sh*t about startups and VC are pretty darn expensive.

Those $100k would be quickly spread thin if they went with one of the big shots to make sure things were done right, but following the advice of a hometown lawyer with no venture capital experience is not the best idea – the last person who did it lost over $100 million in unnecessary taxes (yeah, that was me).

They go back to their angel investor and ask for help – that's what angels are for, right? The suggestion is to set up a Delaware LLC for now, and only worry about a sophisticated corporate structure when they raise more money. Solid advice, except Founder has no idea how to do that, and they don't want to look silly in front of the person investing thousands of dollars in their business.

Falling deeper and deeper into the Google rabbit hole, they come across something interesting: Stripe Atlas. $500 to set up in Delaware doesn't sound bad at all! But Founder needs to invoice customers, maybe even hire an employee or two, and their startup is operating in Brazil. There's no way they can afford to hire and pay taxes in the US, so just a Delaware LLC isn't gonna cut it.

In an ideal world, Founder would set up an operating company in Brazil as a subsidiary of the new Delaware LLC, but that's not Stripe's problem – and they don't have a solution.

Well, we do now.

Instead of spending thousands of dollars on setting up legal entities in the US and in Brazil separately before getting a lawyer to connect the dots, Founder can rely on Latitud Formation to take care of the entire process from start to finish. One single vendor instead of three separate ones. A single source of truth for the incorporation. A much friendlier price than a law firm's hourly rates.

I learned how to do this the hard way, but you don't have to.