According to India’s Finance Minister Nirmala Sitharaman, a staggering 25% of startups in Silicon Valley are managed by people of Indian origin.Â

That’s one in four— meaning if you step into a co-working space in Palo Alto, there’s a good chance you’ll hear someone debating chai vs. coffee while pitching their next unicorn.

But this shouldn’t be surprising. The U.S. has long been the promised land for entrepreneurs because of the following reasons:

• Access to capital – Raising venture funding in the U.S. is significantly easier than in India, thanks to a well-established ecosystem of VCs, angel investors, and startup accelerators (think Y Combinator and Techstars).

• Massive market potential – The U.S. has a huge consumer base with high spending power. Whether you’re launching a B2B SaaS tool or a DTC brand, scaling is faster here.

• Business-friendly regulations – The U.S. has clear-cut business structures like LLCs and C-Corps, making it easier to register, attract investors, and expand.

• Innovation ecosystem – Silicon Valley is an entire mindset there, not a location. The U.S. rewards big ideas, risk-taking, and disruption, which is why Indian entrepreneurs thrive here.

So, if the U.S. is the perfect launchpad for startups, why isn’t every Indian entrepreneur setting up a business there?

In 2022, the Reserve Bank of India (RBI) introduced Overseas Direct Investment (ODI) regulations. These rules make it more complicated for Indian entrepreneurs to legally set up a business abroad.

Many founders previously turned to Stripe Atlas, a service that helps global entrepreneurs incorporate a Delaware C-Corporation (C-Corp) or a Delaware Limited Liability Company (LLC) in just a few clicks.Â

It’s a great option for global entrepreneurs, except if you’re from India. Due to ODI regulations, Stripe Atlas does not support Indian founders anymore, which means you’ll need an alternative that ensures compliance.Â

And that’s exactly where doola comes in to help.

This guide will break down ODI compliance and why it matters for Indian founders. We’ll also talk about why Stripe Atlas isn’t an option anymore.

Plus, we’ll discuss how doola helps Indian entrepreneurs register their U.S. business hassle-free while staying compliant.

Understanding ODI Compliance for Indian Founders

Let’s clear up some basic doubts related to ODI compliance and regulations introduced by the Reserve Bank of India (RBI).

What Is ODI Compliance?

In layman terms, Overseas Direct Investment (ODI) compliance is basically the RBI’s way of keeping tabs on how Indian residents invest in foreign companies. It’s a set of rules that regulate how money flows out of India for business purposes.

Why Does ODI Compliance Matter?

You can’t dodge ODI compliance. If you don’t comply, you could face penalties, legal troubles, and even restrictions on future international investments.Â

The RBI put these rules in place to keep foreign investments under check and ensure businesses follow India’s financial laws.

How the RBI’s 2022 ODI Regulations Impact Indian Entrepreneurs

The 2022 ODI rules require:

• Indian founders to set up an Indian Limited Liability Partnership (LLP) before forming a foreign company.

• The Indian LLP, not an individual, must own shares in the foreign entity.

• Even paying the incorporation fee to start a U.S. company can be considered an ODI investment, meaning you need to follow RBI’s compliance process.

What Is Stripe Atlas? Why Doesn’t It Work for Indian Founders?

Stripe Atlas is an incorporation service launched by Stripe, one of the biggest online payment processors, to help entrepreneurs worldwide set up a U.S. company in just a few steps.Â

With Stripe Atlas, you can:

• Form a Delaware C-Corp or LLC in just a few steps.

• Obtain an EIN (Employer Identification Number) from the IRS.

• Set up a U.S. business bank account, subject to meeting banking requirements.

• Access business tools like payroll, accounting, and cloud computing with exclusive discounts.

• Start accepting payments through Stripe with waived payment processing fees for the first year.

Sounds great, right? But there’s a small problem.

Stripe Atlas is designed for individual founders, meaning it doesn’t support the Indian LLP structure that ODI regulations require. This is why Indian founders can’t use Stripe Atlas to incorporate their U.S. business.

If you’re from India, you need a service that understands ODI compliance and helps you stay on the right side of the law.Â

This is where doola makes things easier, fill out this form to get started.

How doola Helps Indian Founders Navigate ODI Compliance

doola is the best alternative for Indian entrepreneurs looking to start a compliant U.S. business.Â

Here’s how doola makes it easy:

ODI-Compliant Business Formation

doola ensures your business structure meets ODI compliance requirements, helping you:

• Set up an Indian LLP before incorporating your U.S. business.

• Manage paperwork and reporting obligations.

• Ensure your company structure aligns with RBI guidelines.

RBI & ODI Compliance Support

ODI compliance comes with its own set of formalities, like:

• Filing Form ODI with an Authorized Dealer (AD) bank.

• Annual compliance reporting to the RBI.

• Managing foreign exchange laws and approvals for investment.

You can fill out this form to get started with doola.

Streamlined Payment Transfers

Since paying incorporation fees for a U.S. company is considered an ODI investment, doola helps you set up the correct payment channels to remain compliant.

Business Banking & Tax Compliance

doola helps Indian founders:

Final Thoughts

ODI compliance is non-negotiable for Indian founders who want to start a U.S. business. Since Stripe Atlas doesn’t cater to Indian entrepreneurs anymore, you need an alternative that ensures compliance.

With doola, you get a seamless, compliant, and hassle-free way to start your U.S. business while meeting all ODI requirements. If you’re looking for the best way to expand internationally without legal roadblocks, doola is your go-to partner.

Navigating the complexities of ODI compliance can be challenging. Reach out to doola for personalized ODI guidance and support tailored to your entrepreneurial journey.

Common Questions & Additional Insights

Can I start a U.S. company without ODI compliance?

Nope. If you’re an Indian resident, you must follow ODI compliance before setting up a U.S. company. Skipping this step can cause regulatory headaches and financial penalties.

What happens if I don’t follow ODI regulations?

Non-compliance with ODI regulations can lead to:

• Fines and penalties from the RBI.

• Legal restrictions on future international business operations.

• Difficulties in managing financial transactions between India and the U.S.

Does doola help set up an Indian LLP?

While doola specializes in U.S. business formation, we guide founders on the necessary ODI compliance steps, including working with Indian professionals to set up an LLP.

What should I do if I’ve already incorporated through Stripe Atlas?

If you’ve used Stripe Atlas without considering ODI compliance, it’s best to consult a legal professional to ensure you meet RBI regulations.