One of Estonia's first "e-residents" explains what it means

Re:One of Estonia's first "e-residents" explains what it means by ProblemFactory on Wednesday April 04, 2018 @04:48AM (#16753093)

I think the confusion here might be "starting capital" vs "registered share capital". You should set the registered share capital to the minimum allowed 2500 eur. Even companies making hundreds of millions of euros in revenue set usually set it to 25000 eur. You can then invest any amount over that as your actual starting funds without increasing the registered share value.

That way the company is only required to own at least 2500 eur in assets, which should not be a problem for any serious business.

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Re:One of Estonia's first "e-residents" explains what it means by edwin01 on Wednesday April 04, 2018 @05:03AM (#16753156)

Solid advice. I was stupid enough to follow the process estonian gov had laid out and it really didn't make this distinction at any point so I registered our full capital as share capital.

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Re:One of Estonia's first "e-residents" explains what it means by jessaustin on Wednesday April 04, 2018 @11:17AM (#16755527)

If one didn't have this background knowledge, one might hesitate to enter a totally fictitious number on this form.

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Re:One of Estonia's first "e-residents" explains what it means by pavlov on Wednesday April 04, 2018 @12:07PM (#16756064)

What's the fictitious number? You do need to show proof that you have the 2500 € in a bank account.

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Re:One of Estonia's first "e-residents" explains what it means by jessaustin on Wednesday April 04, 2018 @09:05PM (#16760873)

If the actual number is 100000, then 2500 seems fictitious?

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Re:One of Estonia's first "e-residents" explains what it means by ProblemFactory on Thursday April 05, 2018 @07:04AM (#16763657)

The confusion here stems from the multiple meanings of the word "capital".

The logic is identical to for example founding a company in the UK: https://www.gov.uk/limited-company-formation/shareholders

You pick a "name value" and number of shares when founding, for example £1 x 500 shares. This is the "share capital", and official maximum liability of the founders for the company's debts. It also defines the smallest unit of ownership that can be assigned to a person. But of course the actual starting investment, assets, and the market value of the shares can be much higher.

Estonia doesn't use the concept of "number of shares out of total shares", but instead "euros of ownership out of total share capital". For a typical small business you would set it to 2500 EUR and can split ownership at 1/2500 granularity.

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Re:One of Estonia's first "e-residents" explains what it means by pavlov on Thursday April 05, 2018 @01:48AM (#16762151)

It's just a matter of how you want to structure the balance sheet.

You can have 2.5k€ share capital and 97.5k€ free capital. This is usually a better arrangement than having it all in the share capital which is "bound" equity. (Bound is probably not the right English word for this — I only know the terminology in Finnish.)

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