Hybrid of corporation and limited partnership

Angel investors are interested in such setups , due to potential tax reductions . VC prefer to buy shares from a corporations , rather than purchasing the memberships in LLC

Advantages

1. No liability ( personal assets are safe ) , unless one acted in an illegal , unethical or irresponsible manner while carrying out the company activities
2. Ownership can be separated into classes - opens up more means of raising [[Equity]] financing
3. Doesn’t require a board and compulsory meetings with minutes being recorded

LLC does not issue stocks

If one wants to issue stocks, they have to become a [[Corporation]]

Even though we might call members as shareholders , there is no share to trade

Disadvantage

1. Lack of shares
2. Memberships can’t be transferred easily like shares
3. The company might have to dissolve when a member leaves

Special Type

Public

• Trades in the stock exchange
• Full disclosure of financials
• Tightly regulated
• No limit to number of shareholders
• Full liquidity , easily transferable shares at their discretion

Disadvantage :

• If any violation or dispute arises , founding owner might lose control over business

Private

• Not publicly traded , hence not strictly regulated
• Maximum shareholders - 50
• Not as liquid as public limited
• Capital growth is not as good as the public counterpart