If you’re reading this, you’ve likely decided to take the leap and found a startup. Or, you’re at least thinking about making the leap. Startup founders are faced with a number of critical decisions at formation. Certain decisions are specific to the startup and others apply across the board. The concepts discussed below routinely come up in my work with startups.

We’re back with part two of our discussion of formation considerations for startups and founders.

In our initial posts, we discussed formation considerations for startups and founders, including choice of entity considerations. In those posts, we assumed that the startup would opt for a state law corporation taxed as a C Corporation, as the vast majority of startups end up going this route. In this post, we dig deeper into why that is the case.

In my last post, I discussed why most high-growth, venture-backed startups elect to do business as C Corporations. In this post, I focus on the unique benefits offered by LLCs and when a startup may opt for an LLC over a C Corporation.