How to set up my public facing Syndication Company

Question

Hello!I am going to be setting up a company for my syndication business. Is it best to just create this as an LLC, an s-corp or something else?

I am not putting a deal together yet. I just need to create the initial company that will be on my website, cards, podcast and marketing material/ branding.

As I will be creating individual LLC's for each syndicated asset I am not finding the best structure to use for the "parent" company per say.

Thank you!

Brian Burke · Answer

Instead of spending money creating an LLC, adding the requirement to file an LLC tax return, and pay state LLC fees, why not just file a DBA with your county clerk?  It can usually be done for like $10 to $20 and then you can legally use the name and open a bank account (if you need one), create a website, etc.  No extra tax return, it is just a schedule C business.  No costs to maintain, no legal and accounting overhead.

THEN, once you are actually about to do a deal, you can create an LLC or S Corp with the same name and just switch it over.  So many people jump into creating LLCs--focusing on entity structure instead of what should really be the focus--doing deals and growing your network.

If you want to seal the deal a bit more, in many states you can "reserve" the LLC name without filing the LLC.  You do the DBA, then reserve the LLC name and you have it there when and if you need it.

Michael Le · Answer

Too many new investors want to put the 'cards' before the horse. So much focus on website, branding, podcast, etc, without any deals. While all of that eventually becomes important right now you should use that energy and momentum to get a deal going first.

Alina Trigub · Answer

@Taylor Burns

You should read up on syndications as to when the LLC needs to be created and what are the steps associated with syndicating an offering. @Brian Burke new book sold on BP and Amazon should be a good starting point for you.

Ronald Rohde · Answer

I would set up an LLC, costs less than $1,000 but you will need it if you want to be taken seriously as a professional company.

Greg Dickerson · Answer

You definitely want to set up an LLC or S Corp from the start for several reasons.

1. It only takes a few minutes and a few hundred dollars in most states. No tax return is required if you are a single member LLC filing as sole proprietor and do not transact business. I set up LLC's for every new deal, business venture and transaction. I have shell LLC's with no bank accounts or assets for making offers and entering into contracts.

2. You want to be professional and show that you are a serious business. People will look you up and if you are a DBA Sole Proprietor you will not be taken seriously. This is one of the first things most people look for and if you do not have a website or an email address with your domain name some people will not even respond.

3. You should make offers and enter into contracts as an entity not you personally. Its best if this is a clean LLC with no assets or ties to other deals. If something happens or goes sideways and you end up in litigation this can be a real problem. I always use a shell LLC to make offers. Even if the contract has and or assigns the individual or entity that is a party to the contract is legally liable during the process until the contract is assigned. Also if something happens after the assignment it can still potentially come back on the initial party to the contract or assignor. I have been in the game a long time and have seen and been party to some crazy litigations. I was the plaintiff and prevailed each time hands down.

4. As mentioned above you always want to protect yourself from personal liability.

Make sure to discuss things with your accountant and attorney so you can get the proper legal advice when it comes to entity structure, asset protection and taxes as every state is different and depending on your personal situation there may be tax advantages with different entity structures.

Luke Miller · Answer

My advice echos @Brian Burke. I wouldn't worry too much about all the intricacies of the business side. Try looking into syndications to see if it's something you want to build a business around. There are very few things you actually need the LLC for when you're starting out.

PM me if you have questions since i'm local!

Taylor Burns · Answer

@Greg Dickerson Thank you for this!

Courtney Buck · Answer

Totally concur with everyone here. I set up an LLC and had an attorney write up an operating agreement. Some states do not require and OA but I would highly recommend it:)

Message me if you have any questions!

Taylor Burns · Answer

@Brian Burke - thank you very much for that info! That is a quick way to just get something in place as the face to my company. I was not aware of that option.

@Michael Le - I very much agree. I don't want to get caught up in the minutiae of things that don't produce results. I was looking to just get the basics set up where I could have a card to pass out or a website to reference. I don't want to spend much time on this part at all. Just like you said, nothing really matters until I have a deal. Thank you for the advice!

-Taylor

How to set up my public facing Syndication Company

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