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Language: en
hey everybody welcome to another episode
of startup Theory I am your host Tom
Bilu I am the co-founder of Quest
Nutrition and the CEO and co-founder of
impact Theory today we are going to be
covering the question of how to register
your company all right first of all I've
done this multiple times and I still do
not consider myself an expert on this
topic so this is going to be something
where if you can at all afford it I
highly encourage you to seek legal
counsel this is one of those decisions
that can have ramifications um so
choosing wisely and choosing once is
going to be the most streamlined way I
will tell you what I have done um in
most of the occasions is incorporate as
an LLC in Delaware and the reason that I
have done that is Delaware is considered
to be the most friendly business state
from a registration perspective and here
looking on um incorporate.com uh you've
got why is Delaware the most popular
state for incorporation low cost and
quick turnaround can vouch for that uh
simplified business structure setup and
certainly an LLC isn't overly
complicated uh no sales or income tax if
you operate outside the state that can
be very beneficial and then a Delaware
business court that minimizes time cost
and risk of commercial litigation so
those are just a few of the reasons that
people do this um at Quest that's what
we did we incorporated as an LLC in
Delaware at impact Theory same thing um
and then some many many moons ago
Incorporated my very first company also
as a Delaware LLC um and that has really
been just a basic Simple Choice that
I've seen no negative ramifications for
you can change it later if you need to
become a C Corp or an S corp there is a
process that you can go through to do
that um it's a little bit cumbersome so
better to pick the one that ultimately
works for you um and looking at how
income is handled how taxes are handled
um is always a very wise idea and LLC
has what's called pass through income so
the people in the company are going to
be responsible for the profits in thaty
compy so if you set up as an LLC and you
have um profit you are going to be
paying tax on that profit that year
unless there are other reasons why that
would get deferred uh but 99 times out
of 100 you're going to allocate to the
different partners in the company um
exactly how you want the um proceeds to
be allocated usually although not always
usually it's prata so if you have a
partner and you guys are 5050 or 4951
however you structure it you would pay
the correspond amount of tax for the
profits um and if you get a good
accountant you know none of this should
really be that problematic so an LLC is
really straightforward it's one of the
ones that um is going to get you off the
ground quickly it's going to allow you
to get your EIN number which is your tax
um ID number that you will need getting
a tax ID number these days um is very
very straightforward and if I'm not
mistaken Ein n stands for employee
identification number um or employment
identification number and it allows you
to pay UMX tax uh payroll tax for your
employees so got to have it before you
start and getting your LC is going to
let you do that um and you can find all
about that if you just drop into Google
um how do I get my EIN number it's going
to take you right where you need to go
um and as long as you're not claiming a
name that's already in use or a name
similar to one that's already in use you
can get your EIN number literally same
day it's very very fast um but if you're
trying and this is something I learned
the hard way if you're trying to use a
name that has already been used even if
it's just similar um it's going to trip
up the whole process you're going to
have to end up calling in it becomes a
total nightmare and of course they're
not telling you that you just get a
weird um error code that you won't
understand why you're getting it so if
you get a weird error code by the way
chances are that you're trying to use
something that somebody else is already
used or is using um and so you're going
to have to contact them and go through a
paper submission form uh which still
isn't that hateful um try not to do this
at the last minute another lesson I
learned the hard way um so the more you
need an answer very very rapidly the
more likely it is to be painful all
right that's about it on that subject it
really is pretty straightforward use one
of the services perhaps like
incorporate.com um I'm not sponsored by
them or anything it's just I've used
them in the past uh to get your um to
get your filing done I've also used an
attorney attorneys always make me feel
better but just so you know usually
they're also using one of these online
services because they make them very
easy they can just answer a lot of
questions for you all right cool if you
have any questions you can always drop
them in here into the comment section
alternatively you can hit me up at@
tomilu and I will be happy to send more
information your way all right that's it
for now so until next time my friends be
legendary take care