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Ask HN: Has anyone dissolved a Stripe Atlas company?

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Re: Ask HN: Has anyone dissolved a Stripe Atlas company?

#11

Post by delhanty »

tptacek wrote: post #8
leojkwan wrote: post #5

I’m in the process of dissolving my stripe atlas Delaware c Corp. it’s been a nightmare year for me and legal fees. For anyone who plans on bootstrapping a software biz, check out my blog post https://leojkwan.com/stipe-atlas-beware/

I read this post twice and I'm still not sure I understand what the Stripe nightmare is. It sounds like you and your accountant feel you'd have been better off with an LLC. That's very likely! We're a growing company with employees, payroll, equity ownership, vesting, and significant revenue and we're still an LLC and will be for the foreseeable future. But if we decided to go raise funding, Stripe Atlas seems like t…

>I read this post twice and I'm still not sure I understand what the Stripe nightmare is.

Agreed - the text of the leojkwan's blog post is more balanced though.

>It sounds like you and your accountant feel you'd have been better off with an LLC. That's very likely! We're a growing company with employees, payroll, equity ownership, vesting, and significant revenue and we're still an LLC and will be for the foreseeable future.

Stripe Atlas is a great product for it's intended use case, but this bit needs to be written in bold.

If you're doing startup school, for example, but planning on bootstrapping, then you're better served with an LLC.

The choice of Delaware is to protect the investment of YC and the other investors. You agree to Delaware as a condition of them investing in you.

As pointed out elsewhere in this thread by AlchemistCamp, if you're a U.S. citizen, non-Californian resident & bootstrapping consider locating in Wyoming or Nevada. The case for Wyoming is made by HN#flagtheory here [0].

flagtheory.com is a competitor of Stripe Atlas and they outline their, obviously self-interested, case against Stripe Atlas here [1]. (I am not affiliated with Flag Theory and, don't generally endorse them. Thinking of launching your ICO from Nevis [2] ..? Err ... a shady business rarely leads to a sunny life.)

If you're a boostrapping Californian resident, then again from AlchemistCamp, consider locating an LLC in California.

>California, for example, is very aggressive in classifying every business owned by its residents as doing business in California, so many California residents either form a California LLC or leave the state to start their businesses.

If you're bootstrapping and a non-U.S. citizen, non-U.S. resident then consider other business-friendly jurisdictions: Singapore, Hong Kong, Estonia, the U.K. Also, if at all viable, consider your country of residence and/or country of citizenship of course.

[0] https://flagtheory.com/product/wyoming-llc/

[1] https://flagtheory.com/stripe-atlas/

[2] https://flagtheory.com/category/nevis/

Re: Ask HN: Has anyone dissolved a Stripe Atlas company?

#13

Post by privateSFacct »

leojkwan wrote: post #5

I’m in the process of dissolving my stripe atlas Delaware c Corp. it’s been a nightmare year for me and legal fees. For anyone who plans on bootstrapping a software biz, check out my blog post https://leojkwan.com/stipe-atlas-beware/

What is the stripe issue? A $50 corporate fee? CA is $800 minimum BTW. If you are doing funding rounds you need an C corp.

Dissolving cleanly depends ALSO on how proactive and organized you are. The folks who run into messes first find themselves suspended then try to dissolve. If you are proactive it isn't too bad usually.

Re: Ask HN: Has anyone dissolved a Stripe Atlas company?

#14

Post by aaronbwebber »

leojkwan wrote: post #5

I’m in the process of dissolving my stripe atlas Delaware c Corp. it’s been a nightmare year for me and legal fees. For anyone who plans on bootstrapping a software biz, check out my blog post https://leojkwan.com/stipe-atlas-beware/

The only fee you mention is $50, that really doesn't seem like that big of a deal. The blog post does not do a very good job of explaining why being a C Corp has been a "nightmare".

Re: Ask HN: Has anyone dissolved a Stripe Atlas company?

#17

Post by delhanty »

patio11 wrote: post #2

(I work at Stripe.) You can email us and we’ll introduce you to a lawyer who can assist you with winding down the company. In the simplest case this costs $500. Speaking generally, the complexity depends on what you’ve done with the company. Dissolving a company which has had a paper existence but never done anything is straightforward; shutting down a company with material operations, payroll, legal commitments, etc…

> ... Part of the vision for Atlas was that one could do companies as easily as getting an m3.medium. We’re getting there. [0]

Even though there's a caveat ...

>Not legal advice: companies don’t have an Undo button and you probably shouldn’t make one on any given Tuesday for the heck of it... but you totally could form a real, honest-to-Delaware company on any given Tuesday, and there are a lot of things that company could then do. [1]

... somehow I think that the button to create a Delaware C-corp should come with agree-to check-boxes something like this:

∙ I have read Paul Graham's essay on playing house [2] and I'm not just creating a company because that's something startups do.

∙ I understand that there are more lightweight incorporated entities that offer limited-liability and other benefits that might better suit my use-case and that are easier to wind down than a Delaware C-corp.

See also my comment elsewhere in this story. [3]

[0] https://twitter.com/patio11/status/1047017099749666817

[1] https://twitter.com/patio11/status/1047018192097464320

[2] http://www.paulgraham.com/before.html

[3] https://news.ycombinator.com/item?id=20379633

Re: Ask HN: Has anyone dissolved a Stripe Atlas company?

#18

Post by adventured »

AlchemistCamp wrote: post #7
rootsudo wrote: post #3

What's the point? Every state in the USA has an online portal to register an LLC/Corp. You can go to a UPS Store and get an mailbox. You don't file an annual report, and in most states that dissolves the corporation/llc.

Stripe Atlas is the one and only system I've discovered that makes it possible for founders outside the US to get a US bank account. I know dozens of founders with varying degrees of success who have tried for months and failed. If you're in the US, then it's different. In particular, I don't think Delaware is a good choice for most bootstrappers. Creating an LLC in Nevada, Wyoming or another low-cost, low-hassle sta…

Your points were all sound. I'd emphasize that if you're in a state that is reasonable for incorporation (some are not), you're often better off as a bootstrapper to set up an LLC in your own state rather than in Delaware, Nevada et al. Managing most problems are considerably easier within your own state / locally. And if it ends up being successful, you are likely able to afford the cost and hassle to reincorporate in a more ideal state based on the specific business needs.

Re: Ask HN: Has anyone dissolved a Stripe Atlas company?

#20

Post by gamblor956 »

shay_ker wrote: post #19

It sounds like people here have been recommending Wyoming or Nevada over Delaware, for bootstrappers. Can anyone explain why, or point to a blog post that compares forming LLC's in Wyoming/Nevada vs. Delaware?

Delaware has a well-developed body of law dealing with corporations, but not LLCs.

Wyoming has a well-developed body of law dealing with LLCs, since they originated in the state.

I've never heard of Nevada being a particularly good location for incorporation any sort of business entity that wasn't physically located in Nevada...

Generally, you should incorporate/organize in the state in which you are physically located. Organizing in another state (like Delaware) just means that you are subjecting yourself to an additional state's laws and compliance requirements.

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