You want to run your own company, but you know that it's important to take the proper legal steps, right from the beginning. You've never done this before, so you're interested in the different types of businesses you can start and the different benefits that they provide.
Below are a few benefits of a sole proprietorship, a limited liability company and a partnership.
One big advantage is that you don't face high start-up costs. If you want to start small and scale your way up, that helps. It also keeps the most control in your hands alone. It can provide tax advantages and all of the profits go directly to you.
Limited liability company
An LLC, as the name implies, limits your personal liability to protect you. Your ownership and management structure stays fairly flexible, so the company has room to grow. If you're trying to raise capital to help the business, that's sometimes easier to do with an LLC than other company types.
A partnership, where you work with a co-owner, provides some of the same advantages as a sole proprietorship, such as the low start-up costs. Forming a partnership is also easier and less complex than other business types, though you still want to get a partnership agreement in place. Your biggest benefit is that your partner gives you a second source for ideas, skills, connections and capital.
Do you have any questions about the different types of business structures and what to do to form your new company? Our website can provide a lot of helpful information.