Business Form

darrindickeydarrindickey Posts: 1subscriber
edited March 2008 in Business Planning
I`m toying with a kind of crazy idea and I`m wondering what form of business would be best.
I saw something similar suggested on these forums in the past, but this is something I`ve been
contemplating for years. The big idea is to create a sort of virtual incubator. There would be a
small number of original founders for the business...maybe 6. The point of the business is to
find and develop small businesses in which our group would be a partner. We would help other
small groups develop and build their business in return for equity in the company. (We would also
work on developing our own ideas as well as possibly acquiring other small companies.)
I was thinking the original company should be LLC and then each new venture would be a separate LLC,
but would that really protect the original founders? Or would all of the LLCs we are involved in
liable should one get sued?
Also, if we incorporate, where is the best place. I`m in Tennessee, but the founders would all be
from different states in the US.
Thanks for any feedback.
 
Darrin

Comments

  • robertjrobertj Tampa Bay, FloridaPosts: 0subscriber Member
    Darrin,
     
    In general, the liability of owners in an entity (LLC or Corporation) is limited to the amount they have "invested". However, officers/executives of the entity may be subject to additional liability - depending upon specifics of the situation.
     
    If you want "pass through" tax treatment then the LLC is probably the better choice - because of the limitations imposed on a "S" corp.
     
    However, you really should consult with a securities attorney about specifics. I can give you the name of a good one - just send me a PM
  • darrindickeydarrindickey Posts: 1subscriber
    I should probably post here that Robert and I are conversing further about this via e-mail and he has provided me with the contact info he promised.
    Anyone else want to chime in?
    Darrin
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