4 ms·

Just as a word of warning: these documents are for starting a Delaware company. Don't rely on them if that's not what you're after. Also these forms deal with

Just as a word of warning: these documents are for starting a Delaware company. Don't rely on them if that's not what you're after. Also these forms deal with low level technical questions but not the real questions a lawyer should be able to help you with: when and why should you incorporate? What is the real deal between you and your co-founders? How is that deal expressed? What are the traps to be wary of? Using legal documents you don't understand the implications of could lead to to the legal equivalent of software put together by a non-programmer based on google searches of examples of VB code. (IANAUSL - I am not a US lawyer :)

wdaher 16y ago
Agreed on all counts. That said, if you're a tech startup in the US, you almost certainly want to be incorporating in Delaware regardless.
- carbocation 16y ago
  Is Delaware > Nevada for this purpose?
  - gacba 16y ago
    Some more specifics about Delaware: http://startuplawyer.com/incorporation/top-5-reasons-to-incorporate-in-delaware http://startuplawyer.com/incorporation/top-5-reasons-to-inco... Most important among them for (larger) corporations: judges decide cases, not juries, making less of a "wildcard" for litigation.
- 9ec4c12949a4f3 16y ago
  As someone outside of the US, could you quickly explain to me this "Delaware thing"?
  - wdaher 16y ago
    Basically, when you start a company, you choose to start it (to incorporate it) in a particular state. Each state has its own laws about corporations, what they are and aren't allowed to do, etc. Some states have laws that are really company-friendly, and other states have laws that are really shareholder-friendly. Delaware's laws are, in general, quite company-friendly -- so when you're starting your company, it makes a lot of sense to do so there (because your company will get the most legal protection). In addition, "basically everyone else does it". Which isn't good motivation for jumping off a bridge, but it is a good motivation here, and here's why: case law. Lots of companies (and thus lots of Delaware companies) have done crazy things and have had lawsuits over them. So it's better-understood how to interpret portions of Delaware corporate law, because they've been tested before in court. Whereas in some other random state, that's less likely to be the case. As a consequence, I think basically every corporate lawyer in the US is familiar with both their own state's corporate law, as well as Delaware's. And finally, a disclaimer: I'm not intimately familiar with the corporate law of even just one state, let alone all 50, so take this with a grain of salt -- but this is a sketch of the motivations for incorporating in Delaware that I've heard.
    - 9ec4c12949a4f3 16y ago
      Wow, you've made me want to move! Hah.

wdaher 16y ago

Agreed on all counts. That said, if you're a tech startup in the US, you almost certainly want to be incorporating in Delaware regardless.

carbocation 16y ago
Is Delaware > Nevada for this purpose?
- gacba 16y ago
  Some more specifics about Delaware: http://startuplawyer.com/incorporation/top-5-reasons-to-incorporate-in-delaware http://startuplawyer.com/incorporation/top-5-reasons-to-inco... Most important among them for (larger) corporations: judges decide cases, not juries, making less of a "wildcard" for litigation.
9ec4c12949a4f3 16y ago
As someone outside of the US, could you quickly explain to me this "Delaware thing"?
- wdaher 16y ago
  Basically, when you start a company, you choose to start it (to incorporate it) in a particular state. Each state has its own laws about corporations, what they are and aren't allowed to do, etc. Some states have laws that are really company-friendly, and other states have laws that are really shareholder-friendly. Delaware's laws are, in general, quite company-friendly -- so when you're starting your company, it makes a lot of sense to do so there (because your company will get the most legal protection). In addition, "basically everyone else does it". Which isn't good motivation for jumping off a bridge, but it is a good motivation here, and here's why: case law. Lots of companies (and thus lots of Delaware companies) have done crazy things and have had lawsuits over them. So it's better-understood how to interpret portions of Delaware corporate law, because they've been tested before in court. Whereas in some other random state, that's less likely to be the case. As a consequence, I think basically every corporate lawyer in the US is familiar with both their own state's corporate law, as well as Delaware's. And finally, a disclaimer: I'm not intimately familiar with the corporate law of even just one state, let alone all 50, so take this with a grain of salt -- but this is a sketch of the motivations for incorporating in Delaware that I've heard.
  - 9ec4c12949a4f3 16y ago
    Wow, you've made me want to move! Hah.