Have you ever wondered what those letters and abbreviations you see behind business names stand for? They are business formations meaning they help define the nature, taxation, and overall financial structure of a company. If you are planning to open your own business, you will need to define it as an L.L.C., L.L.P, or Inc. Today’s post will help to define the differences between the three main types of business formations.
L.L.C. – Limited Liability Company
An LLC is a company that blends parts of a partnership and corporation structure. LLCs combine the liability nature of a corporation and the taxation structure of a partnership company. LLCs have less corporate regulations like a Board of Directors or necessary shareholders meetings. LLCs also have fewer ownership restrictions and have more choice in deciding a tax structure. LLC and LLPs are considered “pass through” tax entities, meaning that taxation is levied through the income tax of the owners as their profits are considered the income of the individuals. LLCs, like corporations, allow the benefit of separating the proprietor’s personal and business assets. This means that any personal assets not invested in the LLC will not be at risk of loss in case of bankruptcy.
All throughout the month of October, we’ve been exploring LLCs vs Corporations at MyCorp – even more than we already do! The big question we keep revisiting are the LLCs vs Corporations themselves. Should a business become an LLC or corporation? Is there a “right” entity to form for your own business? We created an infographic that compares and contrasts the two together to find out.
Our blog has taken a turn for the Benefit Corporation lately, inspired by the momentum started by B Lab, the founders behind the movement, and this month we’ve created an infographic on how this fairly new entity has been taking the nation by storm. 20 states, along with Washington D.C., have passed Benefit Corporation legislature and our infographic goes in depth to discuss the growth of the B-Corp to come, a look at a few famous companies that you might not know are B-Corps, and a timeline that looks into how long it took states like California, Maryland, and Delaware to enact Benefit Corporation legislation.
This week, we are lucky enough to have a contributed post from Olivier Lemaignen of BlackDiamondSearch.com who, along with being the founder of Black Diamond Search and an excellent marketing strategist, also has the distinction of being the winner of our Facebook iPad giveaway. In his post, Olivier shares what life was like after being laid off, despite having helped the company he worked for become a shining example in the Search Marketing industry, and charging into the unknown in order to create his own business. Even if your own company is in an entirely different industry, the snags, solutions and advice he gives is easily applicable to anyone hoping to build their brand and their business.
It was a Matter of Circumstances
I was asked recently why I decided to start my own company. At first I really didn’t know what to answer other than “it was a matter of circumstances.” To help you understand what I mean, I’d have to take you back a couple of years. I had been working at a major ($3 billion+ in revenue) Silicon Valley software company for seven years, had been handsomely rewarded for my performance and even recognized with a “Marketer of the Year” award presented by the founder. This award was specifically for my contributions in the field of Search Marketing, having taken the company from laggard to a recognized thought leader in the industry. To make a long story short, new management came in, decided to “throw out the old” and… there I was, being laid off despite an impeccable record. This whole experience really made me question whether, in the long run, I wanted to depend on the whims and politics of a corporation versus take my future a touch more into my own hands. Continue reading
Given the current economic climate, some would think it is crazy to start a new business. And those people are correct: crazy like a fox. The number of new businesses being formed has continued to increase, and there are still lots of entrepreneurs taking their ideas and making them a reality right now.
Even though many are throwing around the dreaded “recession” word, and there is a lot of financial uncertainty right now, there are plenty of new businesses being formed. For those who have an idea and are motivated to start a business, they should know they are not alone. Many are choosing now to start companies and form businesses. Continue reading