Here is a quick checklist of the documents required to complete the incorporation of your new company. Certificate of Incorporation for Delaware or the Articles of Incorporation in California Bylaws Determine need to qualify to do business in other states and make appropriate filings in those states. For example, if the Company is incorporated in Delaware but has its principal offices […]
What is an EIN and how do I get one for my startup?
You need an EIN or employer identification number to open a corporate bank account. This is equivalent to a social security number for individuals. The form you will complete is called a Form SS-4. The easiest way to file the form is online at the IRS website. Here are a few tips for completing the […]
What should the purchase price of the founder stock be at incorporation?
The norm for technology startups is for the founders to purchase the initial common stock at a very low price at $0.01 per share or less. I usually sell the initial common stock at $0.001 per share. Part of the reason why I do this is because I like to issue each founder 1,000,000 shares […]
What is the Certificate of Incorporation?
The first step to incorporate a technology startup is to prepare and file the Certificate of Incorporation with the Secretary of State. Think of it like the birth certificate of the company and the beginning of the life of the startup. Don’t be confused with synonymous terminology — in Delaware this document is called the […]
What are bylaws?
Think of the company’s bylaws as its rulebook. It covers a few general categories relating to the operations of a company: Stockholders Directors Committees Officers Record and Reports Other General Matters The bylaws set forth the rights and powers of the stockholders, directors and officers. These are the 3 main groups of players in the […]
Where do startups need to qualify to do business as a foreign corporations?
When a startup is incorporated, founders should understand the requirement to qualify to do business in a state where it is not incorporated and “doing business.” Here’s the basic context: Most technology startups are incorporated in Delaware. However, in each state outside of Delaware that the tech startup is “doing business” the company must register […]
What is the Action by Sole Incorporator?
After the Certificate of Incorporation and Bylaws, the next step in the formation of your technology startup involves getting all the players situated. There are two documents to get this done: Action by Sole Incorporator Written Consent of Board in Lieu of First Meeting When forming a corporation, the Action by Sole Incorporator starts the […]
What is the difference between a patent, copyright and trademark?
Everyone has a great idea. Maybe you are a first time inventor who came up with an idea for a new and useful product, process or methodology. Maybe you are a seasoned business person, and you created a brand name. You have developed a successful market for your brand, and now you want to protect […]
Why is my Delaware franchise tax bill so high and how is it calculated?
As a technology startup incorporated in Delaware, you will receive a tax bill from the State of Delaware. It isn’t necessarily tied to income, but it is a tax you need to pay because the company’s place of origin is in the State of Delaware. All active corporations incorporated in Delaware must pay the annual […]
What is the Board Consent in Lieu of First Meeting?
The Board Consent in Lieu of First Meeting is the first document that gets the business of the startup going. Here are a few of the most common resolutions adopted by the newly appointed board: Appoints the officers NOTE: Delaware requires at least a President and Secretary. This can all be the same person or […]