The HBS Blog offers insight on Delaware corporations and LLCs as well as information about entrepreneurship, start-ups and general business topics.
Often, when people call to inquire about forming an LLC or corporation in Delaware, they are unsure of which formation package they should purchase and unaware of the benefits of the extra features.
In sales, extra features are often used to entice the customer to purchase the more expensive option.
In many instances, you may never even use any of the extra tools you purchased.
This can be frustrating and understandably make you question the notion of extra features.
We include a Corporate Kit as one of the extra features in our Standard package, and we want to let you know that you are truly getting great value for your money.
We are not interested in pushing you to purchase unnecessary items or the most expensive package.
The Corporate Kit offers useful tools that you may find beneficial in running your startup company. We want to assure you of the benefits you will receive if you opt to purchase the formation package that includes the Company Kit; we want you to feel confident in moving forward with your purchase.
The following are key components of the Company Kit for an LLC or corporation, and the benefits of each:
Gold Embossed Company Binder
“Great, thank you. I received the Company binder today in mail from FedEx, looks very nice. Good job.” – ByteSurge LLC
LLC Operating Agreement or Corporate Bylaws
Organizational Resolutions or Corporate Resolutions
The Delaware Company Guidebook
Membership or Stock Certificates & Transfer Ledger
As you can see, our Corporate Kit is fully equipped with useful tools in order to help you achieve success in your new business ventures.
Social media channels such as Facebook and Twitter are effective ways to communicate with fans and introduce your company to new audiences. However, when opening up your brand’s social channels for public expression, you need to be aware that there may be criticism as well—and prepare to react quickly and efficiently to stop misinformation in its tracks before new prospects veto your brand.
For example, in 2010, Pampers redesigned its Cruisers and Swaddlers diaper product lines with a new technology known as “DryMax,” which are 20 percent thinner than previous versions of the diaper lines.
However, soon after rolling out the revamped products, a few parents began complaining that their children had gotten rashes from the new diaper lines. They voiced their concerns both on the Pampers official Facebook page, and on a critic-created “RECALL PAMPERS DRY MAX!” page, which grew to more than 3,100 “fans” who rallied against the brand and shared their criticisms of the diapers. Even worse, the online outcry led mainstream media to pick up the story, with a CNN story questioning whether the diapers were dangerous.
Pampers responded with a detailed communications strategy, issuing several press releases that included statements in support of Dry Max by Kimberly Thompson, founder of the pediatric safety and risk group Kids Risk. Representatives from Pampers also granted television interviews to several media sources to tell the company’s side of the story.
The diapers were also inspected by the U.S. Consumer Product Safety Commission, which confirmed that the products were not a cause for consumer safety concern.
Even so, Pampers offered a dedicated support line for questions regarding the Dry Max products, and kept its social media channels open for discussion, positive or negative. They even offered to compensate some worried parents for pediatrician visits to explore the source of their children’s medical problems.
The brand successfully weathered the social media storm, and today, its Facebook page is a rich environment where parents can ask questions about diapering and baby care, and share parenting tips and stories with one another through Pampers’ daily conversation prompts.
By addressing the rumors and taking steps to alleviate customer concerns while maintaining an open social media environment, Pampers proved itself as a social media success story.
What lessons can you take away from Pampers’ success story?
In February 2011, Devin Scott wrote an interesting HBS Blog about the “Jobs Act,” including some of the advantages coming to small businesses due to its passage and anticipated signing into law by the president.
After it was signed, the process of writing the regulations (rules) about how the law should be followed began, and on Sept. 23, 2013, one of the key advantages for small business became available. It’s called “Rule 506 (c)” and it allows small companies to raise startup capital in a way that was formerly a serious federal crime: by “general solicitation.”
You see, when the Securities Exchange Commission (SEC) was created in 1933, with Joseph P. Kennedy as the first Chairman, there were only TWO ways to sell stock in your company: 1) To make a PUBLIC OFFERING and 2) to make a PRIVATE PLACEMENT. Each of these methods required strict adherence to law and many hours of document crafting and due diligence on the part of lawyers.
Now, we have a third option: the public solicitation. Without eliminating the two existing options, the SEC is now allowing companies the ability to publicly advertise that their stock is for sale. The solicitation can be made repeatedly and can take many forms of public noticing such as TV, radio, newspapers and magazines, public meetings, etc. There is no limit to the amount of advertising you can do or how long your campaign can last.
There is, however, a slight catch: When people respond to the solicitations and desire to purchase your stock, the company MUST take reasonable efforts to prove that the investor has a net worth of more than $1 million, OR that the investor has made at least $200,000 for both of the past two years and is reasonably expected to make $200,000 in the next year. This is the definition of an “accredited investor” in its simplest form.
If the company cannot be assured that the investor qualifies, they cannot take his money.
In the past, investors could simply sign a document stating that they were accredited investors. This is called self-certification and it satisfied the company’s requirement to allow ONLY these high-net-worth individuals to buy their stock. But with the new rules for public solicitations the company must actually perform some due diligence on their investors.
All things considered, this newly legal way of raising investment capital for your company is GOOD NEWS for small businesses all across the USA and will open up new sources of funds for entrepreneurs.
NOTE: There is also a FOURTH method of raising investment capital in the JOBS Act which has been called, “crowd-funding” but it has not yet been completed by the regulators and is not expected to become available until next year. You can be sure we’ll report on it when it becomes available.
In this video you will hear from some of our most loyal customers. They will answer the following questions. Why they chose Harvard Business Services. How easy we made the process. What we did for their business and how we helped them become successful entrepreneurs
Please share your thoughts/ideas in the comments. We would love to know how you take the ordinary work day and turn it into something extraordinary!
What is the Corporation Tickler? What’s it for? Why do I need it?
Not only does the Gold Embossed Deluxe Corporate Kit include:
Another helpful organizational tool included in the Corporate Kit is the Corporate Tickler (p.17 of the Corporate Kit). The Corporation Tickler is an asset used to help owners remember when certain things need to be done. It’s also a great place to keep track of all vital information for your corporation. This allows you to keep up to date records on the identity, addresses, and information of shareholders, directors, the president, vice president, secretary, treasurer, as well as any other officers of the corporation.
Need to know when to hold the next annual meeting or the fiscal year end for the corporation? It’s all right here: Up-to-date contact information for the company’s registered agent, accountant, attorney, banker, insurance broker, etc. can also be recorded on the Corporation Tickler—even something as simple as the location of the company seal, if it’s often recorded. You don’t want get caught in a jam when you are in need of this invaluable corporate information. Keep everything up-to-date on the Corporation Tickler, and keep it in a safe place.