Two years ago we interviewed Fat Shark founder and innovator, Greg French, to get a deep dive on his experience with establishing in Cayman. Now, Fat Shark has some exciting news and we caught up with former CEO Allan Evans, now COO of Red Cat Holdings (the business that acquired Fat Shark).
Join us as we discuss the journey from establishing in the SEZ (Special Economic Zones) to reaching the pinnacle of success for any entrepreneur and trading on NASDAQ.
CEC: How did you initially get involved in Fat Shark?
AE: Greg founded and was running Fat Shark entirely in China 15 years ago but was really looking to move it to a Western jurisdiction. When I came on board to help with the reverse merger, we were looking at either Hong Kong or the Cayman Islands. After talking to Cayman Enterprise City (CEC), we realised Cayman was a good place to set up the company.
CEC: What were the main drivers for Fat Shark to set up and establish in the Cayman Islands?
AE: The consumer drone market we were in was like the hobbyist segment and started to move from analog video to digital video. It became a lot more effort to develop video products. So, it made a lot more sense to join with a larger entity to facilitate those bigger projects to continue to serve our customer base. To do that as we were growing, we knew we needed to formalise, so we started looking for an ownership structure that was easy to transfer, and to be available for transaction. That is when we did a combination with Red Cat. We mostly did an equity transaction, and then as part of that we were able to list on the NASDAQ about six months later.
CEC: Can you explain for other entrepreneurs what that process looked like for you?
AE: Entering a new jurisdiction can sometimes be much more challenging, but it was actually a really smooth process to put together all the paperwork and establish an offshore company in Cayman. We had to transfer all the assets over to put the whole brand in Cayman and operate the company from there. From start to finish on the transaction was less than three months.
It helped that our books were well kept which made the auditing very quick to transact. CEC were very helpful in setting up the banking and doing the introductions as we did a debt-financed reverse merger. Our legal representation came in and we set up with the law firms and accountants in Cayman who were very quickly able to put together the deal.
Allan Evans teaching a virtual reality class at local university - University of the Cayman Islands.
CEC: What have been the benefits you’ve seen to choosing CEC and the Cayman Islands as a location?
AE: Running a global company in Cayman is great. CEC understands the global picture of needing to go fast and get things done. So, they were a very effective conduit because everyone is wonderful and super effective in enabling legal work and banking. If I had to list some of the other benefits I’ve noticed they would be:
- Time zones - It’s really easy to do business on the East Coast because you’re not in some weird halfway around the world situation
- Cayman infrastructure is good
- Obviously, there’s tax incentives
- The ability to hire from anywhere and not have to deal with H1B's of any sort
- It is a phenomenal place to live in terms of having all the amenities of a really nice city, but all the benefits of a smaller town. Amazing restaurants, amazing weather.
- Very significant legal and financial infrastructure including big financing firms like KPMG and a lot of legal firms. Basically, relationships with people to enable your entire business right.
CEC: What’s on the horizon for you now?
AE: We're in a position where actually a week ago we announced our newest digital headset, so the whole process has been very successful in putting us in a place to have the resources to execute on more sophisticated products.
We went from being a CEC client to being traded on the NASDAQ and it wasn’t tricky. Cayman as a jurisdiction doesn’t prevent you from achieving any of the business goals you’re looking to achieve. There’s not a higher level of public business outcome that you’d want to achieve than being on the NASDAQ.
A big thank you and congratulations to Allen (and Greg) for everything they have achieved with Fat Shark, and for sitting down with us to discuss the process. If you want to establish a genuine presence in Cayman, visit our business set-up page to learn more.