I am starting a software business and I am not entirely sure how to proceed with incorporation and drafting an operating agreement.
I have one co-founder and we’ve been working together for a few months validating our product with our target market but have not started building. We are ready to start building but we’d like to have a business entity set up with a business bank account so that everything can stay organized under the business.
We’re not sure where to start or who to work with. I’ve found some start-up attorneys through Google searches and have considered options like Stripe Atlas and Clerky but I’m not sure how important it is to have a lawyer handle everything vs. an automated “service”.
Does anyone have experience finding the right attorney to work with or using a service like Stripe Atlas?
The entity you choose to incorporate as depends on the outcome you want.
(FYI I’m not a lawyer, but have founded several companies and have wasted $ on lawyers during the early stages when templates or lower cost services will do)
Want to run a small business? Do an LLC or S Corp, the tax advantages are better than a C Corp. You can do this for a low cost on an automated platform or yourself using free state-website guides/forms.
Want to raise money and offer shares to investors? Set up a C Corp right away. Register it in Delaware. Investors don’t like wasting time on non-standard corporate structures for no reason.
Want to run your transactions using Stripe’s API? Then Stripe Atlas is a great option.
For your operating agreement, there are plenty of good templates out there for you and your cofounder to fork. Most important thing though is you take a lot of time to make sure you both feel fairly compensated and motivated to put 5+ years into this.
Lawyers can be really really helpful when running a startup, but most of the setup stuff can be boilerplate and not require a legal expert’s time.