Case Note: Entity Formation as Strategy
The Situation
A startup with several high-value projects in the pipeline was preparing to raise capital. The founders needed a structure that supported investment while protecting their existing, separate businesses and ensuring a fair internal arrangement.
The Strategy
After reviewing the business model, capital plans, and member dynamics, we formed a New York LLC. New York offers a sophisticated and predictable court system that investors recognize and trust. While corporations remain common, many investors today are comfortable investing in LLCs, particularly in media and closely held ventures.
To reduce friction among members and limit the cost and duration of any future disputes, the operating agreement included arbitration provisions with prevailing-party attorneys’ fees. The entity was registered in Albany to significantly reduce statutory publication costs. A secure data room was established early to provide organized access for members and prospective investors.
The Outcome
The company launched with a clear ownership structure, investor-ready documentation, and a jurisdiction aligned with its long-term goals. The company quickly closed angel investor deals and secured rights for a high-profile project.
The Takeaway
Entity formation is not a filing exercise. It is a strategic decision that shapes control, risk, and opportunity from day one.
Advisory Note
If your business involves fundraising, multiple stakeholders, or meaningful assets, it’s worth thinking through structure and jurisdiction before filing anything.
