There are some businesses that make sense to be LLCs, like small businesses where the earnings will be regularly distributed to the owners. Almost all venture-backed companies, however, operate as Delaware corporations. This is the result of a number of factors, including the limited ability of venture funds to invest in businesses that are not corporations and the clarity of, and practitioners' facility with, Delaware corporate law. PLEASE CONSULT YOUR LEGAL/TAX ADVISORS FOR ADVICE ON WHETHER YOUR STARTUP SHOULD INCORPORATE.
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