Why your startup should be a Delaware C-Corp, not an LLC

Re:Why your startup should be a Delaware C-Corp, not an LLC by joeax on Wednesday March 15, 2017 @03:59PM (#13879258)

> Incorporating as a C-Corporation in Delaware is the gold standard for high growth startups

Not every business is designed to be a "high growth startup". Consulting firms, bootstrapped startups, small micro-ventures, self-published presses, all of these benefit from the ease and simplicity of an LLC. Unless an investor is cutting you a check for $1mil+ I would lean toward an LLC.

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Re:Why your startup should be a Delaware C-Corp, not an LLC by andrew_gust on Wednesday March 15, 2017 @04:29PM (#13879470)

Absolutely! For many kinds of businesses, LLCs make sense, but this post is specifically about startups.

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Re:Why your startup should be a Delaware C-Corp, not an LLC by meesterdude on Wednesday March 15, 2017 @04:51PM (#13879655)

LLCs make perfect sense for startups, too.

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Re:Why your startup should be a Delaware C-Corp, not an LLC by andrew_gust on Wednesday March 15, 2017 @04:57PM (#13879711)

If they don't want to grant equity or take investment, sure. But doing one of those two things means the legal costs of starting with an LLC (which aren't standardized) substantially outweigh any tax savings, and almost no startups prior to that point have positive cash-flow anyway so taxed profits aren't much of an issue.

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Re:Why your startup should be a Delaware C-Corp, not an LLC by brianwawok on Wednesday March 15, 2017 @07:46PM (#13881023)

LLCs can grant equity just fine. Please don't spread FUD.

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Re:Why your startup should be a Delaware C-Corp, not an LLC by andrew_gust on Thursday March 16, 2017 @11:27AM (#13885785)

Sure, but there isn't an out-of-the-box mechanism to do that. You have to create a way to grant equity, which means you'll need to pay a lawyer—and hourly rates add up quick.

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Re:Why your startup should be a Delaware C-Corp, not an LLC by staticautomatic on Thursday March 16, 2017 @12:37PM (#13886424)

Still FUD. Plus, making equity deals without consulting a lawyer is a bad idea regardless of your corporate structure.

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Re:Why your startup should be a Delaware C-Corp, not an LLC by brianwawok on Thursday March 16, 2017 @02:17PM (#13887445)

Exactly. Too many people trying to push all starts into a Delaware X corp for their own gain. Not great blanket advice for everyone, do your own research.

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Re:Why your startup should be a Delaware C-Corp, not an LLC by meesterdude on Wednesday March 15, 2017 @05:13PM (#13879842)

i agree, but it's not just a tax matter - there are also significant organizational and operational implications to be had.

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