The document discusses three basic structures for organizing a business - sole proprietorship, partnership, and corporation. It provides the pros and cons of each structure. For corporations, it describes the ownership and decision-making structure including shareholders, board of directors, and officers/employees. It then discusses one model for structuring a startup corporation using founders' shares and repurchase agreements, and the typical legal agreements needed like articles of incorporation. Budget costs are provided for setting up the legal documents.

1. TeamCamp
May 7, 2009
How do I structure my
business?
Shane McLean
LaBarge Weinstein Professional Corporation

2. Three Basic Structures
• Sole Proprietorship
• Partnership
• Corporation

3. Sole Proprietorship
• Pros:
§ Simplicity, ease of use, creation,
dissolution
• Cons:
§ Unlimited liability
§ Going it alone

4. Partnership
“relation that subsists between persons
carrying on business in common with a view to
a profit”
•Pros: •Cons:
•Simplicity •Unlimited liability
•Tax losses •Not pro-investor

5. Corporation
• Pros:
§ Limited liability
§ Flexibility of Structure
§ Tax
§ Pro Investor
• Cons:
§ Administratively more complex than other
models

6. Corporation
Ownership Decision Making
Shareholders
Shareholders
Board of Directors
Corporation
Officers/Employees

7. Hybrids
• Prime/Subcontractor Model
• Software Bill of Rights Model

8. One Model for a Startup
Corporation
• Concept:
§ Corporation
§ Group of Founders issued “free” shares
§ From beginning the corporation has the
right to repurchase shares from founders
§ Founders “earn” the right to keep shares
through the satisfaction of objectives
and/or passage of time.

9. One Model for a Startup
Corporation
At a minimum you will need:
Articles of Incorporation, By-laws Etc.
Founder Agreement
Shareholder Agreement
Employment / Contractor Agreements
Intellectual Property Agreements

10. One Model for a Startup
Corporation
What does that cost?
Articles of Incorporation, By-laws Etc. •Budget $750 - $1,000
Founder Agreement •Budget $300
Shareholder Agreement •Budget $600
Employment / Contractor Agreements •Budget $250
Intellectual Property Agreements •Budget $250
More Customization = More Cost

11. THANKS
Shane McLean
smclean@lwlaw.com
613 599 9600 ext 262
www.LWLAW.com
www.ShaneMcLean.com