A primer on corporate legal structure…with a few new twists


As the business world attempts to embrace the idea of social enterprise, a primer might be in order, with a look at some new structures in California:

When choosing the proper legal structure, there a many important considerations.  Among them are:
  1. Is now the right time to incorporate?  When we start new businesses, we often think that incorporating should be the first thing we do.  Sometimes thats right, but not always.
  2. How will the ownership of my company be shared?  Will it be a 50/50 split with partners, or is some other percentage more appropriate?  Do you agree on everything with your partner, or should one of you have the deciding control?
  3. What form of structure will give us the appropriate protection, tax situation, and fit our companies makeup?  Will you have a number of employees, or will it just be the owners?  Is the a structure for holding property, or a service business?  Do you anticipate going public?
  4. Are you going to operate a social enterprise?  If so, does your state offer an alternative structure like the “Benefit” corporation?  Is that a good fit?  Is it necessary?

These are just a few considerations worth discussing before actually moving forward with a new business structure.  It’s always best to consult your attorney and a good CPA.  The cost for a few hours of consultation is a small price to pay for setting up the appropriate structure.

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2 responses to “A primer on corporate legal structure…with a few new twists”

  1. Brandon Prideaux says :

    What’s the actual discussion here? Or is this for a class you are teaching?

    • BriceY says :

      Brandon, I was uploading those link for class, but I did edit it a little to be more informational to the broader reading public, such as yourself😉

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