Learning Center, Starting Your Business

Starting LLC as a Holding Company in Delaware

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You have a great business idea and want to protect you and the assets you have by starting your own business. So, you decided to start an LLC in Delaware. However, that brings about some questions:

What kind of business operations can I do with this LLC?
How many businesses can I operate under this LLC?
Do I need to state what kind of businesses my company is doing?
Do I need to start a separate LLC for each of my businesses?
Should I consider “Series LLC” or start separate LLCs for each of my businesses?

Businesses started in Delaware have the right to do any business all around the world. People, in Delaware, usually choose to start Series LLC because there is single line accounting and tax expenses in Delaware. However, it is still controversial how successful this new business model is; there may be many obstacles. This is why many people also choose to operate under different LLCs.  The process is simple: you start a Delaware Holding Company and also start other LLCs which are under this holding company yet separate.

Many people choose to form a DBA for different business branches under a single LLC. The process is as follows: registering a fictitious name that would describe the range of businesses, you do and products you sell. However, this process does not provide a legal separation for different business branches. That means if there is something wrong with one of your LLCs, other LLCs are also responsible.

Currently, attorneys and professionals around the globe suggest starting a separate LLC is a better option, which means separate traditional LLCs should be started for each service provided, product, and business type. By doing so, you separately protect your assets, debts, and liability in case something unwanted happens to one of the LLCs.

While starting multiple LLCs, it is always recommended you follow a detailed hierarchical plan, so you provide corresponding relationships between LLCs. This is also a good idea to separate your assets from the assets your business has.

If you have any further questions, please don’t hesitate to contact us.

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