One month ago I landed with my family at the Hong Kong airport. I expect we’ll live here for three or four years, perhaps more. While here I am opening a branch office of my online marketing firm, which is headquartered in Salt Lake City, Utah. I do not speak Cantonese. I have never lived in Hong Kong or Asia before. The first time I ever came to Hong Kong was in March of this year. And now I own a business here. Where it will end up I can’t exactly predict, but here’s how I got it started.
Opening a business in Hong Kong was a piece of cake. I’d like to say it’s because the government has a quick, easy, and affordable online process that caters to Americans, but it doesn’t. I found the Hong Kong business registration website quite confusing. But there are many companies happy to take care of the entire process for you. Through Startups HK, a networking group for entrepreneurs and investors, I connected with HK Commons and they took care of everything for around $400 USD. I found that a modest fee to pay to avoid 20 hours figuring it out myself and to obtain the peace of mind of knowing it would be done correctly. This was all completed prior to my stepping foot in the country.
Getting a virtual office is the fastest and most affordable way to get a business address in Hong Kong. Whereas in the U.S. the term “virtual office” often means renting an actual office, here you can start out renting no space at all, but receiving the services of a business address, phone and fax numbers, and staff to answer calls in English, Cantonese, or Mandarin. Since I’m starting out with a home-based office, this is all I need, and with a promotion it cost me $400 USD for the first year. These virtual office businesses, including HK Commons, Compass (my provider), and Centre O, also provide co-working space, conference rooms, individual private offices, and full service large offices. If I need a conference room for a meeting or am ready to upgrade, they’re ready to meet my needs. Linkedin’s Hong Kong office is housed at the same address I use for my business.
HSBC holds a near monopoly on business and personal banking in Hong Kong. There are other options, but don’t expect to see any American banks here. Citibank and Wells Fargo have a limited presence in Hong Kong, but one Citibank customer we met here says the U.S. and Hong Kong branches of the bank don’t communicate well with each other. I went with HSBC primarily because everyone else uses it, and since payments for business services here are made primarily via electronic transfers rather than paper checks, it seems most convenient to go with the flow.
Although it’s all fine now, opening an account at HSBC was the most challenging aspect of getting my business up and running here, due to the fact I could not open an account without being here in Hong Kong in person. This introduced a significant delay in our visa process, as I’ll explain below.
Hong Kong has various visa options or “schemes” as they call them here. Most people come on work visas as employees of firms here. One can also come for 90 days on a simple tourist visa, and extend it for another 90 days simply by going over the border to China and then coming back. Because I own a majority of my business, I was not eligible for a work visa, and so I started looking into the Quality Migrant Admission Scheme because hey, my mom says I’m cool. If I’m not high quality, who is? Notwithstanding my mother’s endorsement, it turns out this option appears to be primarily for celebrities, although I’ve heard that some people have made it in based on academic and/or professional qualifications. There is also the Capital Investment visa, but this requires one make a deposit into a Hong Kong bank of approximately $840,000 USD. As we tried to figure out which visa scheme fit our circumstances, we stumbled onto Stephen Barnes, a Hong Kong visa consultant who runs an informative blog on immigration to Hong Kong at HongKongVisaGeeza.com.
Through his company Hong Kong Visa Centre, Stephen offers multiple levels of services ranging from simple advice to full-service, we-do-everything(contact Stephen directly for pricing). Although the price seemed high, we decided since this would make or break our plans to move to Hong Kong, we wanted to make sure our visa application was successful. And Stephen’s expertise along with his guarantee to get us our visas or give us double our money back gave us the confidence to work with him. I don’t want to gush too much, but Stephen was perhaps the most professional person I have worked with, ever. Never have I seen someone juggle so many different pieces of information and stay on top of things and in touch with the client as well as he did. When I was in college I often felt as though the professors were unaware that we were taking any class but their own, based on the amount of homework we were assigned. With Stephen I couldn’t understand how he could be working with any other clients, given how much attention he was giving us. As the complexity of the paperwork grew and we went through multiple submissions of information, my wife and I many times commented on how glad we were to not have tried to do it ourselves.
The visa Stephen counseled us to apply for is called the Investment visa, or more commonly the “business investment visa.” This visa is for business owners or entrepreneurs who are coming to Hong Kong to start or expand their business, and turned out the be the only visa I was qualified to apply for. In addition to the expected paperwork, I was required to submit a business plan and place startup capital in a bank account in Hong Kong. This is where we ran into delays, since I could not open the bank account without being in Hong Kong in person, and I had not planned on coming to Hong Kong prior to our move. Fortuitously, a speaking opportunity at a business conference presented itself, and in March I was able to make a business trip to Hong Kong, open the bank account, and then deposit the funds.
As to how I deposited the funds, no, I didn’t travel with wads of cash or gold bullion in my luggage. I used the services of GPS Capital Markets, a firm that specializes in currency conversion and international transfers. The service is only available to businesses, so it wouldn’t work for someone to transfer personal funds to another country. Once I was signed up with GPS they were able to do an international wire and transfer U.S. dollars from my U.S. business account and deposit Hong Kong dollars into my HSBC account in Hong Kong, and at a very favorable exchange rate compared to any other service I’ve been able to find.
We first contacted Stephen Barnes on October 15th, 2012 and signed up with him a few days later. Our visa application was submitted January 3rd, 2013, and we received our approval April 25th, 2013. The process took longer than it normally would due to the issue of getting a bank account set up. As I alluded to earlier, if need be we could have come on a tourist visa (which does not require a prior application) for 90 days while we awaited approval on the business investment visa.
The business investment visa allows me, and my family who are here on “dependent” visas, to stay here for 12 months. At the end of those 12 months the government will check in on me to see how my business is doing, and if I’m hiring local talent and growing then there should be no problem with me getting the visa renewed.
Thanks to VOIP technology, I was able to bring my office phone from Utah. Provided by Jive Communications, I can plug the phone into an Internet jack anywhere in the world and it will work just as it did while I was in Utah. Actually better than in Utah, since Internet speeds in Hong Kong commonly reach 10 times the speed they did when I was on Comcast in Utah, and at half the price, I might add.
The slightly more complicated part was getting my mobile phone to work as I wanted it to. I wanted to keep the same number I had in the U.S. and be able to receive calls and texts on my cell phone here in Hong Kong as though I were in the U.S., but simultaneously be able to make mobile calls here in Hong Kong from the same phone. I’ve gone into a bit more detail on the process here, but suffice it to say that by porting my U.S. number to Google Voice, and then using a free Android app called GrooVe IP, I’ve been able to get exactly the functionality I wanted. When someone calls me from the U.S. I pick up and talk as though I were in the U.S. When I call someone in the U.S. from Hong Kong they see my U.S. mobile number and have no idea I’m on the other side of the world. For those of you tempted to tell me I should have used Skype, I did, and trust me, this method is much, much better.
One of the most pleasant aspects of this move has been to see how easy it is to network in Hong Kong. Having few business contacts here prior to making the move, I worried about how I would get my business here off the ground. Now I worry about how I will keep up. There are more organized networking events where I can meet other entrepreneurs, business owners, and executives than I can possibly attend. This calendar from the SME Creativity Center, an outreach effort of the Hong Kong government, will give you a small view into the number and types of events available for someone looking to get out and become involved in the business community. I’ve found many great events on Eventbrite and Meetup, and I’ve heard good things about various international groups such as the American Chamber of Commerce.
There are also ample opportunities for online networking with active business communities on Linkedin, Facebook, and Twitter.
There are many more aspects of this venture I could cover such as finding housing; finding accounting, legal, and other professional services; and finding employees and hiring. These will be covered in due course as I write extensively about my experience starting and running my business here in Hong Kong.
For now, here are a few details you may find helpful:
- Mail forwarding from the U.S. is free via the U.S. Post Office. I don’t understand why, but it is.
- There are no capital gains taxes in Hong Kong. The highest personal tax bracket is 17%. The corporate tax rate is a flat tax of 16.5% on profits.
- There are many government entities dedicated to assisting businesses start up in or move to Hong Kong. The foremost of these is InvestHK which has some useful resources on doing business here. I recommend getting in touch with the people at InvestHK who can open doors and be quite helpful. All their services are provided free of charge–that is, you’ve already paid for them with your taxes.
- English is an official language in Hong Kong, and one can do business quite easily here without knowing any Cantonese. But if you’re inclined to learn, I love these videos for getting started.
After reading this you may feel moving your business to Hong Kong doesn’t sound easy at all. If that’s you, I recommend you find someone from Hong Kong who has tried to move and start a business in the U.S. That might put things in perspective.