Delaware vs Israel: where are the biggest and easiest exits?

ivcj logoThe Israel Venture Capital & Private Equity Journal (IVCJ) released that makes the case for incorporating startup companies in Israel. The author Barry Levenfeld, partner at Israeli law firm Yigal Arnon & Co., highlights the benefits of incorporating in Israel given the recent changes in tax and exit circumstances, which makes Israeli incorporation easier and in some ways more advantageous than ever before.

Some of the benefits stated in the article:

1) Tax

Not long ago Israeli founders faced a 50 percent or higher tax on the gain from the sale of their shares by either initial public offering (IPO) or acquisition (M&A). Incorporating in Delaware opened up planning possibilities, some more legal and successful than others, but it at least gave hope to avoiding the 50 percent tax.

NOT ANYMORE – One reason: the low rate of corporate tax in Israel (27 percent on its way to 25 percent, with possible significant reductions for approved enterprise status)

2) Corporate law – IPO

…there is no doubt that from a corporate law perspective, it is better today to be an Israeli company on Wall Street.

3) Corporate law – M&A

Israeli merger statutes do have some clumsy features, such as a forced waiting period of at least 50 days until closing, but, in general, purchasing an Israeli company today “looks and feels” like the purchase of a Delaware corporation.

Click here to view the full article (pdf 24kb)

Eze Vidra
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Eze Vidra

Chief Innovation Officer at Antidote
Eze is the Chief Innovation Officer at Antidote, a startup helping patients search and match to clinical trial, to accelerate medical breakthroughs. Previously, Ezewas a General Partner at Google Ventures Europe. Before GV, Eze founded and led Campus London, Google's first physical hub for startups, and was the Head Google for Entrepreneurs in Europe. He's an experienced product manager and startup mentor. In 2012 Eze founded Techbikers, a non-for profit supporting children education in developing countries.
Eze Vidra
Follow me

Eze Vidra

Eze is the Chief Innovation Officer at Antidote, a startup helping patients search and match to clinical trial, to accelerate medical breakthroughs. Previously, Eze was a General Partner at Google Ventures Europe. Before GV, Eze founded and led Campus London, Google's first physical hub for startups, and was the Head Google for Entrepreneurs in Europe. He's an experienced product manager and startup mentor. In 2012 Eze founded Techbikers, a non-for profit supporting children education in developing countries.

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