Attending an Accelerator program in the US as a EU foreigner – a comprehensive guide for founders.

This post has been written by Arnaud Dahan and Eric Biny, 2 of the co-founders of Nybber who want to share their experience with the community.

Our team joined Travelport Labs, a 17-weeks accelerator program in Denver, Colorado, as a member of the Feb-2016 batch. None of us had US citizenship, nor a green card or any kind of visa or residency permit (that’s right, it means, among other things, no SSN –social security number– nor credit rating).

We are all French, and were living in our home country prior to moving to the US for the program.

• Did we have to deal with a lot of pitfalls? Kind of.
• Was it costly? In the end, mostly time-wise.
• Was it a good idea after all? Definitely.
• Will it be easier if we had to do it again? You bet!

This guide is intended for those (especially coming from the EU) who plan to relocate in the US for the entirety of their program. We did so, and will advise you to do it too: you’ll get so much more value out of an acceleration program by having your team there, in person, the whole time.

1 – Get the right visa – act fast!

If your country of citizenship is participating in the Visa Waiver Program, and your program last less than 3 months (12 weeks is pretty popular), you can be tempted to go for the ESTA: it’s fast and cheap (about $14).

If your country doesn’t qualify, or if your program is longer, you’ll need to go through the visa procedure in order to get the regular B-1 visa that allows you to stay up to 6-month (for those who are wondering: visa runs are extremely risky in the US, don’t do that like you’ll do in Asia).

But even if your program is short and you are eligible to the ESTA, you should consider applying for a B1/2 anyway: the program you’ve been accepted in should allow you to qualify for a 6-month multiple entries B1/2 visa valid for 10 years. This chance to get this visa is probably worth the $160 application fees (instead of $14 for the ESTA).

Here is how getting the B1/2 looked like for us:

Going through your local US embassy website (US consulates don’t deliver Visa in France), you’ll be able to apply online and pay the $160 related to the application fees. Be careful: only Debit cards are accepted (no Credit card). If, like in France, nobody has Debit card, you’ll need either a foreigner friend to pay for you, or to make a bank transfer that can take up to 1 week to proceed. Once the payment is received, the embassy will give you a physical appointment.

There is a website that gives you an estimation of the current appointment wait time, which may vary by city and time of the year. For the appointment, you’ll need a signed letter from the Program director of your accelerator, stating that your startup has been accepted for a X-months training, and that you’re required to be there in person the whole time.

After your visit to the embassy, you should get your passport with the visa delivered to your home about 1 week later, by standard mail.

Be warned that this process can take about 1 month: you should start it as soon as you know you’ve been accepted.

2 – Flight

The US custom and border being what it is, if your first stop in the US is not your final destination, you may be stuck there for a couple of hours and miss your connection. If your border agent is moody and has no clue what an acceleration program is, he can put you in a room for an hour or two until someone more competent can take the time to interrogate you. Although the interrogation itself should be pretty straightforward, the wait time is more than likely to make you miss your connection. The company shall rebook you on their next flight at no extra cost, but it can significantly delay your arrival at your final destination: keep that in mind.

3 – Travel health insurance

Whatever healthcare is covering you in your country you should know that there are a very few chances that they will pay the fees for your directly if you have a problem in the US, but will expect you to advance the money. We hope no one will be confronted to health problem but better safe than sorry. So what we recommend and what you should do each time you go to a foreign country is to subscribe to a complementary insurance which will pay the advance for you and be repaid by your healthcare service.

We used ACS AMI cost around 34€/month and cover medical, hospital and surgery expenses, sanitary repatriation, civil liability and luggage insurance.

4 – Setup a company

If your accelerator requires you to have a Delaware C-Corp (or if you want to), you have several options. We picked LawTrades.com, and for a flat fee of $1000, they took care of what is absolutely needed:

• All government filing fees
• Certificate of Incorporation
• Bylaws
• Restricted stock purchase agreements with vesting provisions
• Capitalization Table & Stock Certificates
• Invention/intellectual property assignment
• Initial board consent
• 83B election (see 8 – 83(b) election – ITIN)
• EIN Number (see 9 – EIN Number)

Beware: as foreign founders, everything can be longer and trickier than expected. Make sure the person you’ll be working with understand that.

5 – Open a bank account

First of all, know that you need an EIN number to get your account open (see 8-). We suggest you tackle this as soon as possible, because it’s way more convenient to be able to receive and dispose of the founding directly in USD, with a US bank account.

Once the EIN obtained, the process has been relatively seamless for us thanks to Silicon Valley Bank. What you will need at minima are a couple of debit cards, the possibility to make a few bank transfers within the US and maybe 1 international transfer per month. All of that should be free, or nearly.

If your accelerator is a member of GAN, you could consider Atlas, a service by Stripe that will get your company incorporated and your bank account opened for $500.

6 – Rent a flat

This one may depend on the city you are going to. If it’s like Denver, Colorado, you’ll have great difficulties to rent a flat for a few months, because there are very few furnished apartments on the market (and mostly overpriced/luxury), and almost nobody wants to sign a lease contract below 12 months without applying a huge premium to your rent.

Other problems you may consider: gas, electricity, insurance, internet, tv, sewer and garbage. All of this is not necessary included in your rent contract. You will have to set everything by yourself. Again, as you don’t have a SSN nor a credit rating, it can be messy.

What turned out to be effective was contacting hosts from websites like Airbnb, explaining our situation and budget: many of them have several apartments and will consider taking a direct offer for a couple of months. Although, you can always try to negotiate arguing that you’ll be able to move-in the next day.

We finally decided to go with a real estate renting agency specialized in corporate housing. Everything was included and furnished, but do not hesitate to negotiate because those flats are mainly destined to corporate-paid rentals, so they bulk the prices.

7 – What about a Car?

Here again, it will depend where you’ll go, but keep in mind the vast majority of US cities are designed for people who have car(s). After considering several options we eventually went for a mini-lease with AVIS. When you commit for a lease of 60 days or more, prices should drop significantly. In addition, F6S have a couple of great discounts, and those add-up to coupon codes you can find directly on the company website.  With one coupon of up to 25% discount, plus a free premium upgrade and the long term rental booking, we managed to get a pretty descent car for less than 20$/day!

The only real problem is the insurance. In the US, many people are covered for rental cars within their own auto insurance policy, but it’s very likely you’re not, which leaves you with no third-party or collision damage waiver. Sure, Avis and other car rental companies offer you to take their insurance at an extra cost, but as the price is per-day, it’s absolutely not suitable for long term rentals. The good news is there are several online insurance companies that will solve this problem for you.

We managed to get insurance for around 150$ a year for rental contract up to 60 days. As a mini-lease of AVIS is handled with consecutive 30-days contracts, it worked perfectly.

8 – 83(b) election – ITIN

You’ll certainly go for vested shares when you establish your company in the US for 2 main reasons: it will protect your company against a passive cofounder and because it will lower the tax you will have to pay in case the capital of you company is increasing (after all you are going to the US for that, right?). By unlocking 20% of your share each year and filling a 83(b) election, you’ll be protected against huge capital gain taxes if your company valuation increase drastically in the upcoming 5 years.

What you may not know is that to fill the 83(b) election, you’ll need to apply for a ITIN number. Took us 2 months to get it (but it’s ok because you can fill the 83(b) with “ITIN: Applied for”).

2 options: First is to ask a lawyer and pay him to do it and follow up for you (we’ve been quoted $150 for 3 applications).

Second is what we did:

• Download W7 form (ITIN application) (linkfor download + instruction)
• Download 1040NR form (income declaration) (linkfor download + instruction)

What did work (after some round trips between our office and IRS):
Disclaimer: Use our advices at your own risk. We decline any responsibilities for any problems that could occur.

• For the W7 form, reason you are submitting: check (b) : Nonresident alien filling a US tax return as the reason you are then filling the 1040NR with everything set to 0 - if you do not have income in the US of course…
• For the 1040 NR just fill everything with zeros. This is only to justify you application to ITIN.

Do not try to talk about 83(b) election as apparently not everybody at the IRS know what this is…

You will need a certified copy of your passport. A good idea would be to make one at home before going to the US. (But the French consulate in Denver did it for us, for free, in 48h, when we called and said we needed it for the IRS, and that the alternative would have been to mail them our original passport.)

9 – EIN Number

To get your EIN number you need a SSN number OR an ITIN number from one of the founders. As the chances to receive your ITIN before arriving to the US is small, know that you will need to ask your attorney to apply for your company EIN number in your name. Make sure it’s included in the fees you pay to set up your company.

Checklist – Reminder

Administration:

• Apply for B1/2 as soon as you know you’re accepted in your program
• Get a certified copy of your passport
• Apply for ITIN (W7 form)
• Send your 1040NR form
• Set up the company (for the EIN: don’t forget to ask the attorney to apply for you using his SSN)
• Do not forget the 83(b) election

Flight:

• Waiting for you visa to get accepted is certainly the best way to not miss your flight and waste money

Insurance:

• Get travel health insurance as soon you got your flight tickets
• Get a rental car insurance before your rent your first car
• Avoid house rentals with no insurance included

Banking:

• Find a bank and start the opening process
• Finalise the opening when you receive your EIN number

Housing & car:

• Prefer house furnished and with everything included: gas, electricity, internet, insurance, TV, sewer.
• If you are not in a city well equipped in public transportation or too far from the city, just go for a long-term car rental. Combine coupon and make sure you are covered for damage.

We really hope this will help you navigate in this new world, and wish you an amazing acceleration program! If you still have interrogation do not hesitate to contact us at contact@nybber.com