Houston Real Estate and Business Law Firm

Business Law FAQs

Frequently Asked Questions in Business Law

1. What type of entity should I make for my startup company?

It depends. Are you planning to stay small or go public?

Different corporate structures have their benefits. The choice of structure depends on how you want to run your startup. If you intend to keep the ownership small, and the taxes simple, the startup can be structured as an S Corp or even a limited liability company (LLC). If you intend get investors, give people shares in the company and eventually become a publicly traded, then the best structure may be a corporation .

We would recommend drafting a business plan for your start up and then consulting legal counsel for your case.

2. What type of entity should I make for my startup company?

It depends. Are you planning to stay small or go public?

Different corporate structures have their benefits. The choice of structure depends on how you want to run your startup. If you intend to keep the ownership small, and the taxes simple, the startup can be structured as an S Corp or even a limited liability company (LLC). If you intend get investors, give people shares in the company and eventually become a publicly traded, then the best structure may be a corporation .

We would recommend drafting a business plan for your start up and then consulting legal counsel for your case.

3. I have a startup, do I need to have any written agreement with the other owners?

Yes! Ideally yes. We would strongly recommend getting legal counsel who can help draft a shareholder agreement between the shareholders of a startup.

A shareholder agreement sets rules and boundaries, and it addresses most events that owners can come across, such as death, divorce or transferability of the shares.

It is imperative that shareholders get such an agreement to ensure that they know their rights in the company.

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