the reality is that there are 49 other states, half a dozen territories, and hundreds of semi-autonomous reservations a handful of which are also known to have their incorporation statutes
they haven't all stayed still over the past 30 years while Delaware’s marketing engine keeps going, they compete directly
anybody with reading comprehension can find one more favorable and cheaper than Delaware
some even have “chancery courts” just like Delaware
there are even currently obscure entity types that Delaware doesn't have, which may be more favorable. there is more than a C-Corp and an LLC out there
the same is true all around the world, all you need is incorporation cheaply and quickly, and access to domestic and international banking in the company’s name cheaply and quickly, which isn’t necessarily tied to the country your business is in.
there are infinite permutations. it is true that there are only a couple jurisdictions that excel on the cheaply and quickly part.
your real question is a lot more loaded, as you dont know what entity type you want, and dont know what state you want or why
I personally dont use Delaware, most of the time. If I am selling shares to VCs I will create a Delaware C-Corp. but even then I’ll start with an LLC somewhere else and just reincorporate when the VC is serious
I personally find Wyoming to be better faster and cheaper than Delaware, for an LLC. it depends on which registered agent you use though.
> I personally find Wyoming to be better faster and cheaper than (...)
I hear that some states (or all?) require you to have someone physically in the state (and naturally some companies offer this as a service, and charge). Is that right? or are there some states without this requirement?
So are you saying that all states require a physical address? Yes, I understand that some companies offer this as a service, but that in itself doesn't mean there's no state where this isn't required.
Most do, but this often means a physical address. In Delaware there are companies that will provide you a physical address and forward any mail you get to that address to wherever you want to get mail. While this can be done in other states, this is much less common and so if you look for someone you may discover everyone refuses because they assume you are trying to commit fraud (it isn't fraud, but if you don't worry about that you need to readjust your moral)
You are not wrong, but not necessarily right either. Delaware is used so commonly for this that they have a lot more details worked out where you may need a court trial for something weird. If anything goes wrong a lot more lawyers will know how Delaware laws work. There will be a lot more services that can do little things for you. You will find accountants who know Delaware rules (if you live in a state you will find accountants who know that state's rules, but good luck finding one who knows the rules for a different state - unless that state is Delaware).
Is the above worth the costs? I cannot answer that. There are many it depends. however everyone should be aware that Delaware provides a lot of value for the money, and a lot of that is hidden second order things. Those things may or may not matter.
As my post says, some other jurisdictions have chancery courts just like Delaware, which means getting quick access to a business only court, and quick generation of case law.
But I think you - and most others that repeat that cookie cutter advice - are still missing the opportunity. Being able to get a competent court trial for something weird is absolutely valuable, but if you don't like the case law in Delaware you can literally argue for the opposite result in another state. Calculate the risk (and be good at math)
To me, that's a really fine reason to not use Delaware, for a fresh slate. You can shape the world, or craft a slice of it that suits you.
I agree with you that there are less service providers in other states. And they don't get as much action and have less reason to be competent too. My primary point still stands, most people don't need Delaware, most people never need those other service providers, never need a state court. If they ever get big and complex they're still most likely going to be in federal jurisdiction anyway - or have the option of moving a case to federal jurisdiction. Random entrepreneurs and placeholder company creators need a registered agent and that's it.
I'm a co-founder of Clerky — I think it really depends on your needs. If you're starting a true startup (as in you are going to optimize for growth, might raise money, etc.), then you'll be better off either using Clerky or working with a good startup attorney, or both. The reason for this is because there is a lot more you'll need to do beyond just incorporation, and we have products for that. Incorporation just causes the corporation to exist, nothing more. No one even owns any shares right after incorporation. The odds of someone getting all the paperwork right on their own if they're not a startup attorney are basically 0%.
Even for incorporation itself, if you do it on your own or work with a registered agent, it's likely that you'll end up needing to at least amend your certificate of incorporation later. Most of the self-help / registered agent resources out there are for regular small businesses, not startups, so the guidance is not really what startups need. Some people like referring to every new business as a startup, I think because it sounds sexier to be working on a startup than a regular small business.
However, if you're starting a regular small business — i.e. not a startup — then I would say using Clerky is not a good idea. We're really purpose-built for startups and don't attempt or purport to serve regular small businesses. Whether you should use a registered agent alone is another question. At a minimum, if you have business partners you're starting the business with, I would say you probably should talk to a business attorney rather than trying to go on your own. On the other hand, if you just need an entity just for the sake of having an entity, and don't really care about whether the paperwork is done correctly or not, then just working with a registered agent directly could suffice.
the reality is that there are 49 other states, half a dozen territories, and hundreds of semi-autonomous reservations a handful of which are also known to have their incorporation statutes
they haven't all stayed still over the past 30 years while Delaware’s marketing engine keeps going, they compete directly
anybody with reading comprehension can find one more favorable and cheaper than Delaware
some even have “chancery courts” just like Delaware
there are even currently obscure entity types that Delaware doesn't have, which may be more favorable. there is more than a C-Corp and an LLC out there
the same is true all around the world, all you need is incorporation cheaply and quickly, and access to domestic and international banking in the company’s name cheaply and quickly, which isn’t necessarily tied to the country your business is in.
there are infinite permutations. it is true that there are only a couple jurisdictions that excel on the cheaply and quickly part.
your real question is a lot more loaded, as you dont know what entity type you want, and dont know what state you want or why
I personally dont use Delaware, most of the time. If I am selling shares to VCs I will create a Delaware C-Corp. but even then I’ll start with an LLC somewhere else and just reincorporate when the VC is serious
I personally find Wyoming to be better faster and cheaper than Delaware, for an LLC. it depends on which registered agent you use though.