Buying 50% Of A Business - Need Advice

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DominicanQuest

New member
Oct 22, 2012
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I am going to purchase 50% of a business here in the DR. I am American and I have no visa. I also do not have a cedula or residency. Anyone with knowledge of the way things work here - I have a few questions:

-Can an American own a company in the DR without a visa or residency?
-In your experience - what do I need to know?
-What is the paperwork I need to complete? How much does it cost? How long does it take?

Here are things I already know:
-The owner of the business is trustworthy
-The business is 100% legit -complete with a fixed location and clientele with which I have personally interacted various times
-I know the value of the business.
-I know that it is a good business, there is a lot of demand, and that I am getting a good deal with the what the owner is asking to sell me 50%


Thanks for any help you all can offer.
 
E

Expat13

Silver
Jun 7, 2008
3,255
50
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DominicanQuest said:
I am going to purchase 50% of a business here in the DR. I am American and I have no visa. I also do not have a cedula or residency. Anyone with knowledge of the way things work here - I have a few questions:

-Can an American own a company in the DR without a visa or residency?
-In your experience - what do I need to know?
-What is the paperwork I need to complete? How much does it cost? How long does it take?

Here are things I already know:
-The owner of the business is trustworthy
-The business is 100% legit -complete with a fixed location and clientele with which I have personally interacted various times
-I know the value of the business.
-I know that it is a good business, there is a lot of demand, and that I am getting a good deal with the what the owner is asking to sell me 50%


Thanks for any help you all can offer.
Click to expand...

What part of the country?
 
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Ringo

On Vacation!
Mar 6, 2003
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OP has SO many holes and flags in this that....This is not even worth TRYING to answer.
 
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DRob

Gold
Aug 15, 2007
8,234
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DominicanQuest said:
I am going to purchase 50% of a business here in the DR. I am American and I have no visa. I also do not have a cedula or residency. Anyone with knowledge of the way things work here - I have a few questions:

-Can an American own a company in the DR without a visa or residency?
-In your experience - what do I need to know?
-What is the paperwork I need to complete? How much does it cost? How long does it take?

Here are things I already know:
-The owner of the business is trustworthy
-The business is 100% legit -complete with a fixed location and clientele with which I have personally interacted various times
-I know the value of the business.
-I know that it is a good business, there is a lot of demand, and that I am getting a good deal with the what the owner is asking to sell me 50%


Thanks for any help you all can offer.
Click to expand...

If the business is profitable, with continued demand, and there are no obstacles or immediate competition (which is almost unheard of in DR for newbie expats), then why is the owner willing to sell a 50% stake? What do you bring to the table in terms of unique skills (as you don't know anything about the DR, clearly) that makes giving up a half interest in the business reasonable?

I'm not saying this to be mean, but I'm trying to understand why anyone would give up such a large stake for what you characterize to be an established, profitable enterprise.

My advice would be to do nothing and just observe, preferably while living there 6-12 months before even thinking about a business. DR really is an entirely different animal.

Given that I'm sure you really want to proceed, in the alternative I'd buy a 10% stake, get down there, learn how the business is really doing (as opposed to on the day(s) they showed it to you), work in it, practica su Espanol, learn the lay of the land, and then - maybe - proceed.

There's an awful lot to learn, but even more to lose (far more than your 50% stake, consider your time, opportunity cost, carrying and maintenance expenses (you gotta live and eat somewhere other than home, after all), etc.
 
Hillbilly

Hillbilly

Moderator
Jan 1, 2002
18,948
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Run, do not walk, to the nearest airport and get a flight home!!!

This is a train wreck waiting to happen.

Bye, bye, nice to have met you...



HB
 
M

mike l

Silver
Sep 4, 2007
3,157
466
0
DominicanQuest said:
I am going to purchase 50% of a business here in the DR. I am American and I have no visa. I also do not have a cedula or residency. Anyone with knowledge of the way things work here - I have a few questions:

-Can an American own a company in the DR without a visa or residency?
-In your experience - what do I need to know?
-What is the paperwork I need to complete? How much does it cost? How long does it take?

Here are things I already know:
-The owner of the business is trustworthy
-The business is 100% legit -complete with a fixed location and clientele with which I have personally interacted various times
-I know the value of the business.
-I know that it is a good business, there is a lot of demand, and that I am getting a good deal with the what the owner is asking to sell me 50%


Thanks for any help you all can offer.
Click to expand...

I made an offer and acceptance bid that was approved and we could close soon but would need to see your finacials in order to present this.
 
D

DominicanQuest

New member
Oct 22, 2012
148
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0
DRob said:
If the business is profitable, with continued demand, and there are no obstacles or immediate competition (which is almost unheard of in DR for newbie expats), then why is the owner willing to sell a 50% stake? What do you bring to the table in terms of unique skills (as you don't know anything about the DR, clearly) that makes giving up a half interest in the business reasonable?

I'm not saying this to be mean, but I'm trying to understand why anyone would give up such a large stake for what you characterize to be an established, profitable enterprise.

My advice would be to do nothing and just observe, preferably while living there 6-12 months before even thinking about a business. DR really is an entirely different animal.

Given that I'm sure you really want to proceed, in the alternative I'd buy a 10% stake, get down there, learn how the business is really doing (as opposed to on the day(s) they showed it to you), work in it, practica su Espanol, learn the lay of the land, and then - maybe - proceed.

There's an awful lot to learn, but even more to lose (far more than your 50% stake, consider your time, opportunity cost, carrying and maintenance expenses (you gotta live and eat somewhere other than home, after all), etc.
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I understand everyone's concern. But, let me say that it was I who approached the person with the proposition to buy into the business. I do marketing, which the business needs desperately. I know how to attract customers, both in the DR and back home in the US. It is what I have done for the past 14 years of my life.

There is a lot of competition in the DR for this particular business, but there is an established clientele, plus unlimited opportunity for growth. The reason the owner is willing to accept MY offer is because, due to poor management,the business is in jeopardy. I only learned this after I approached offered to buy into the business. I have personally gone to see for myself. The status of the business is impossible to fake, and is not in dispute.

I asked for advice because I am speaking to an abogado. I just wanted to be able to double check his advice. He does not know the business owner.


Thanks all
 
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Ringo

On Vacation!
Mar 6, 2003
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dominicanquest said:
i understand everyone's concern. But, let me say that it was i who approached the person with the proposition to buy into the business. I do marketing, which the business needs desperately. I know how to attract customers, both in the dr and back home in the us. It is what i have done for the past 14 years of my life.

There is a lot of competition in the dr for this particular business, but there is an established clientele, plus unlimited opportunity for growth. The reason the owner is willing to accept my offer is because, due to poor management, she is in jeopardy of losing her business. I only learned this after i approached her with the offer. I have personally gone to see for myself. The status of the business is impossible to fake, and is not in dispute.

I asked for advice because i am speaking to an abogado. I just wanted to be able to double check his advice. He does not know the business owner.


Thanks all
Click to expand...

rofl.
 
S

sayanora

Silver
Feb 22, 2012
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DominicanQuest said:
I understand everyone's concern. But, let me say that it was I who approached the person with the proposition to buy into the business. I do marketing, which the business needs desperately. I know how to attract customers, both in the DR and back home in the US. It is what I have done for the past 14 years of my life.

There is a lot of competition in the DR for this particular business, but there is an established clientele, plus unlimited opportunity for growth. The reason the owner is willing to accept MY offer is because, due to poor management,the business is in jeopardy. I only learned this after I approached offered to buy into the business. I have personally gone to see for myself. The status of the business is impossible to fake, and is not in dispute.

I asked for advice because I am speaking to an abogado. I just wanted to be able to double check his advice. He does not know the business owner.


Thanks all
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Good luck with your venture, let me know if there's anything I can help you with!
 
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PeterInBrat

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May 29, 2006
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I would have the existing business dissolved including paying any employees severance pay. Start fresh. Buying into a partnership can be very risky-- if the current owner has debts or pending lawsuits you may find yourself equally liable by becoming a partner, and such liabilities may exceed the value of the entire business, much less your investment.

Think pre-nup...
 
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Onions/Carrots

Bronze
Jan 3, 2003
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I think the only question you need to ask is just one. If the business goes bust, will this financial loss destroy you psychologically and economically. If the answer is NO, then go for it. The only way you'll really know if it was worth it is to try it. No risk, no reward so hop on board and play your luck. Without risk and people taking chances, we wouldn't have much of an economy anywhere. Even during the Great Depression, someone was making money like shoe repairmen.

On the other hand, if you're banking all you've got in the bank on this long shot then stay away. The DR is about to enter one of its most difficult economic times ever. The gov't is essentially bankrupt. Crime soaring to new highs. The great REFORMA is going to zap what little money the working classes have. The public and private debt has soared to levels of which the DR economy will never be able to make payments on to completion. Keep in mind that the macro-economic portrait of the DR is quite a dismal one.

So once again the poignant question is are you dealing with money that you can lose. If so go for it since you say you have a plan. If marketing is your forte as you claim then it shouldn't be much of a necessity to decide what to do. Also since you are buying halfway and the owner is someone you trust per your claims then it seems you have at least something working for you. Of course, this is what you claim.
 
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DominicanQuest

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Oct 22, 2012
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Onions/Carrots said:
I think the only question you need to ask is just one. If the business goes bust, will this financial loss destroy you psychologically and economically. If the answer is NO, then go for it. The only way you'll really know if it was worth it is to try it. No risk, no reward so hop on board and play your luck. Without risk and people taking chances, we wouldn't have much of an economy anywhere. Even during the Great Depression, someone was making money like shoe repairmen.

On the other hand, if you're banking all you've got in the bank on this long shot then stay away. The DR is about to enter one of its most difficult economic times ever. The gov't is essentially bankrupt. Crime soaring to new highs. The great REFORMA is going to zap what little money the working classes have. The public and private debt has soared to levels of which the DR economy will never be able to make payments on to completion. Keep in mind that the macro-economic portrait of the DR is quite a dismal one.

So once again the poignant question is are you dealing with money that you can lose. If so go for it since you say you have a plan. If marketing is your forte as you claim then it shouldn't be much of a necessity to decide what to do. Also since you are buying halfway and the owner is someone you trust per your claims then it seems you have at least something working for you. Of course, this is what you claim.
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Thanks for the advice. I purposefully didn't describe the business or price. I am very comfortable with the prospects for the business, and the price of admission is more than affordable for me.

I avoided discussing those details because I hoped to get advice on what are the legal steps I need to take, and what obstacles I may face as I don't have residency or a visa. I was hoping to avoid the "This is the DR and everything here violent/risky/bad/doomed to fail/a scam/all about the money/etc. conversation. I know the DR can be tough - but - as they say - "A coward dies a thousand deaths." We are all going to die, and we can't take anything with us - so why not LIVE while we are living? So, yea, I'm gonna do this deal if it is possible. For me just doing the deal is a success in itself, regardless if its the next big thing or not. Of course, I will largely control that.

Back on topic - any advice on what LEGAL challenges I may face would be appreciated.
 
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rubio_higuey

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Feb 7, 2007
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To straight answer your questions - you do not need a residency or visa to be owner of a business, or even a director. What you will not be able to is being employed by that business, e.g. taking a salary and contribute and partake in social system. You will even be able to run the business (e.g. be the manager) even if no residency/visa.
 
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playacaribe2

Gold
Jan 9, 2004
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DominicanQuest said:
Back on topic - any advice on what LEGAL challenges I may face would be appreciated.
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Adivice on those LEGAL challenges are best handled by an experienced, knowledgeable attorney. Do your due diligence with that one carefully....and you may well avoid a whole lot of pitfalls.

Adding my two pesos though, it is never a wise idea to hold a business 50/50...51/49 yes....50/50 never. It creates too many potential standoffs as to the direction of the business.


Respectfully,
Playacaribe2
 
Hillbilly

Hillbilly

Moderator
Jan 1, 2002
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While I was essentially against this venture, you have received some excellent advice:
1) Dissolve the current business, paying off all employees with their severence pay packages and making sure there are no hidden debts lurking--
2) Buy 51% of the business. Your brains and fresh capital, his failure to make it go better.
3) Be extra "hands-on" until you really know everything. Don't trust anyone. And I mean anyone, not ever "your" lawyer. Double check everything. Be paranoid to a fault.

Do not worry about residency or visas, yet. If it all works out, we have a few good people that can help you with that stuff. All it takes is time and money. Depending on who you choose, more or less time and more or less money....like everything else here.

As O&C has pointed out, this is not a particularly encouraging moment to invest, but you say you can afford it, so what the heck...YOLO, so go for it.

PS. I once told a guy to never, ever give money to a relative of his girlfriend, especially to start a colmado in a barrio. He did and the colmado is doing fine. So you can see how much of a business expert I am....

HB
 
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