Business Structure Advice

Business Structure Advice

Travis Chisholm

FIN/571

October 28, 2015

Waree Dorsey-Waits

Business Structure Advice

Dear John Owner,

Let me first congratulate you on your new business and say what an honor it is that you would seek my council on this manner. The first thing you would need to do is develop an executive summary. An executive summary gives investors, and potential partners a glimpse of what your business is, your plans and the goals you are trying to achieve. This is particularly necessary if you are pursuing a loan from a bank. Next, you will need to offer a company description. A company description explains what it is you do how your business differs from other companies in the same industry, and the market you intend to serve.

In regards to whether or not you should take on business partners you may want to look at the scope of your business first. Is your business small enough to where you can manage things yourself? Can you raise the capital on your own? The advantage of having full control of your business is you get to shape the entire business in your image without the need to consult anyone. Unfortunately, the downside is you assume 100% of the risk; this includes lawsuits and tax penalties. However, should you take on a business partner it is imperative that you establish expectations with one another and have those expectations documented and vetted by an attorney. This is to ensure that there is no misunderstanding between both parties and provide you with a sense of security.

One option would be to start your business as a Limited Liabilities Corporation (LLC). One advantage of an LLC is it is easy...