A C-Corporation is the structure venture money is built around: transferable stock, an option pool, a board, and a Delaware charter your lead investor's counsel has seen a thousand times. We set it up clean so your first diligence request isn't a fire drill.
If none of these describe you in the next two years, an LLC is probably the better and cheaper answer. We'd rather say so now.
Venture funds and most angel syndicates invest in Delaware C-Corps because their fund documents effectively require it. Asking them to invest in an LLC costs you leverage and time.
Stock options are a solved problem in a corporation and an awkward one in an LLC. If you plan to hire with equity, incorporate.
Profit kept inside the company is taxed at the 21% federal corporate rate rather than at your personal marginal rate — useful if you're reinvesting rather than paying yourself.
Qualified Small Business Stock can, if a long list of conditions is met, exclude a large share of gain on an eventual sale. It only applies to C-Corp stock. Talk to a tax adviser early — the clock starts at issuance.
Delaware isn't a tax trick. It's a legal system: a dedicated Court of Chancery with no juries, judges who have decided corporate disputes for over a century, and a body of case law that makes outcomes predictable.
Delaware makes sense when
Delaware is a waste of money when

An illustrative structure. Yours is set with you, not from a template.
Incorporation is the easy half. The corporate housekeeping that follows is what founders forget — and what a term sheet's counsel goes looking for.
Choose the state and see the total. Delaware's corporation fee starts at $109 for a standard share structure.
The default home for venture-backed C-corps; corps pay franchise tax instead.
Start incorporationDelaware corporations pay franchise tax annually — typically $400–$450 minimum for an early-stage company, plus a $50 annual report.
Included on Premium. We agree the authorised share count, par value, founder splits, vesting and option pool before anything is filed, so you're not amending a charter in month three.
The Certificate of Incorporation is filed with your chosen state — Delaware usually returns approval within a business day, with same-day service available.
Bylaws adopted, directors appointed, stock issued, ledger opened, EIN obtained, 83(b) forms sent. You finish with a real minute book, not a PDF of a certificate.
A C-Corp pays 21% federal corporate tax on profit, and shareholders pay tax again on any dividends. For a profitable small business that distributes everything to its owners, that's a genuine and avoidable cost — which is why an LLC usually wins there.
For a startup that reinvests everything and pays no dividends, the second layer never triggers. That's the case where a C-Corp's downside is largely theoretical.
Ten million authorised shares at a very low par value is the market convention for a startup planning to raise. It gives room for founders, an option pool and future rounds without amending the charter, and it keeps Delaware franchise tax near the minimum when calculated on the assumed par value method.
If you're incorporating a business that will never issue options or raise, a far simpler structure is fine and we'll suggest one.
Almost certainly, yes. If your Delaware corporation has an office, employees or meaningful ongoing activity in another state, that state expects you to register as a foreign corporation, appoint an agent there and file its annual report. Skipping it can mean penalties and losing the right to bring a lawsuit in that state.
We file foreign qualifications in every state — see foreign qualification.
Yes, and it's common right before a priced round. Delaware allows a statutory conversion, which is cleaner and cheaper than forming a new entity and merging into it. There are real tax consequences depending on how your LLC was treated, so this is a conversation for your CPA and a lawyer — not a checkout button. We'll handle the filings once they've told you which route to take.
At minimum: an annual report and franchise tax in the state of incorporation, a federal Form 1120 corporate return, state returns wherever you operate, and the corporate housekeeping — annual shareholder meeting, board consents for significant decisions, and a maintained stock ledger.
The housekeeping is the part founders skip and diligence catches. Your compliance calendar lists all of it.
Delaware typically approves within one business day. Your organisational documents follow within two.
Not sure which structure fits? A specialist will tell you straight — even when the answer is the cheaper one.