Don't Forget This Critical Key to Starting Your Business
Determining which legal structure is best for your company is a decision worth careful consideration.
So you think you have the idea for the next big thing? Of course you do. You're a passionate entrepreneur. Now that you have this great idea, what's one of the next important steps in developing it?
Determining which structure best suits the company you want to build.
If you ask Adam Liebman, founder and CEO of New York City-based group meetup app Squad, the most crucial thing you can do is to seek the advice of an expert, or someone who has done it before. "This road has been walked before," Liebman says. "You don't have to cut a new path in the forest."
The most basic legal structure is a sole proprietorship, which can make the most sense if you intend to do all the work yourself. From there, your options include partnership, limited liability company (LLC), corporation, and S corporations.
For Squad, Liebman knew he might want to take the company public someday, so he opted for the C corporation – the business structure that is best suited for companies that might go public.
It's helpful to know structuring basics before speaking with an attorney or another expert. After all, you're the person in who is charge and calling the shots. "As CEO, you're responsible for the vision," Liebman says. "Stick to it."
Liebman shares more on business structuring in the video above.
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