LLC

“So here's what an LLC does not do. It does not save you federal income tax by itself. People think that and they'll say, well, you know, I could write off more if it were an LLC. I don't believe that to be true. If you could write it off because it's a true bu…”

“If you set up an LLC, it reduces your liability, but loose guidance, you don't need one when you have a landing page. You don't really even need one when you have some revenue.”

“The two primary reasons are most VC funds have pension funds, and those pension funds have tax liabilities that LLCs impact, and so VC funds cannot risk impacting their VC fund LPs.”

“I came to learn that I didn't actually own a business. I owned a job that I worked that had a business front on it.”

“From an investor perspective, especially institutional investors, like they will not invest in LLCs. They'll only invest in C corps because of the complexity.”

“Most people tend to way over complicate it. Like you can keep it as simple as I have in terms of, kind of, how you structure stuff or things just flip to you individually rather than having, like, a bunch of LLCs and stuff like that.”

“We set up an LLC for one of our businesses in the States and it started making a bunch of money and we didn't realize that we should have converted it to an S corp. And which is another type of corporation. So and that cost us hundreds of thousands, if not mil…”

“I didn't have an LLC for the first five years of, I had all these products. I had, this was from O two to O seven, 2007. I was a freelancer, I was a contractor, and I was making money from software products, six figures from all this stuff. And I was still a s…”

“Sometimes it's two, two to five businesses of different sizes. So you're actually investing. You're a partner in the LLC and. As those businesses cash flow, we distribute the profits back to investors. So each quarter, whatever profits are made, investors rece…”

“It's a two third, one third split. So because you're not actively running these businesses, right? You don't own, you have no say in what's done in the businesses. You, the investors receive two thirds of the profit every quarter. And when these businesses are…”

“We pull out everything at the end of the year. Now, first of all, we're an LLC. So we're taxed on everything at a personal level. So if I leave money in the business, I'm still paying personal income tax on that money. It doesn't really make sense to do that.”

“It makes sense to not start your company as a C-Corp if the goal is a business that Pays you cash on the side, but you're not building enterprise value. So let's say you're running Alex Consulting Services LLC or whatever. I tell you, it doesn't make sense to …”

“If you say I'm going to be an LLC and I want to take profit out of business and run this for 10 or 20 years, you will significantly reduce the pool of investors who are willing to invest in you.”

“If you plan to run it for five years and sell it, personally, that's not a bad idea. If you plan to pull dividends out, it's not a good idea because C Corps have double taxation”

“An LLC that's been around for three years, In most states is an asset. Who owns the LLC when the company goes under? Because frequently with a startup, that may be the only thing you have that is worth anything after three years. And the reason the LLC is wort…”

“The vast majority of angels and VC firms will not invest in an LLC.”