The Delaware LLC is by far the most popular entity type for most entrepreneurs building a startup.
As a result, people often wonder if they can operate multiple LLCs under one umbrella LLC.
For example, let's pretend a business owner has a trucking business incorporated as an LLC but after some time, he/she may also want to offer real estate services.
These are two completely different types of businesses, so it raises the question of whether or not the owner can provide both services under one LLC. Part of the consideration is, naturally, wanting to avoid additional costs for maintaining another LLC.
The answer is yes--it is possible and permissible to operate multiple businesses under one LLC. Many entrepreneurs who opt to do this use what is called a "Fictitious Name Statement" or a "DBA" (also known as a "Doing Dusiness As") to operate an additional business under a different name.
However, just because it’s permissible and possible to operate several different types of businesses under one company (LLC or corporation) doesn't mean you should, as there can be downsides.
For example, if a lawsuit is filed against any one of the businesses, the assets of the others could be at stake. The result is that you put yourself at a higher degree of liability risk.
Instead, many people opt to file a new LLC for each of their start-up ventures. This isolates the risk instead of spreading it around. There are, of course, additional maintenance fees, but these can be well worth it in order to protect your businesses.
If you would like more information or have any questions about forming your own companies, please contact us by phone (800-345-2677), Skype (DelawareInc), email or live chat. One of our knowledgeable business startup specialists will be happy to assist you.
There is 1 comment left for Can I Operate Multiple Businesses Under One LLC?
We have a commercial real estate LLC for more than 5 years. Do we need a separate LLC if we are selling products online like Amazon and eBay? Or can we put this as an umbrella? But still need a separate LLC name? We need to know quickly.
The sky is the limit with how you choose to operate your LLC. However, typically, if you have two businesses that are doing two completely separate things then often clients file separate companies so not all their eggs are in one basket, so to speak (liability, legal issues, etc.).