Startups Stack Exchange Archive

How to structure the ownership of a Delaware company?

• posted by: Aminadav on 2017-08-14
• tagged: legal, equity, united-states
• score: -1

I’m using Stripe Atlas for creating a new company in Delaware. They ask me if I want:

• A new company, owned by individuals and investors
• A subsidiary of an already existing company

What is the pros & cons of a new company vs a subsidiary company?

Answer 13188

• posted by: Denis de Bernardy on 2017-08-14
• score: 0

It’s not about advantages of one or the other, they’re basically asking you if this is:

• A new business, in which case the future owners will own the new business.
• An existing business that is incorporating a new one in the US-DE (for any reason, including but not limited to opening a branch in the US), in which case the existing business will own the new business.

(There likely are some arcane and subtle tax-related differences too, but from a practical standpoint you shouldn’t be worrying about those until you can afford an army of lawyers.)

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