Ask HN: Do I need to setup a business for my side project?
Been looking at https://stripe.com/atlas
Seems easy enough, but was wondering when is the appropriate time to actually set up a business?
Seems easy enough, but was wondering when is the appropriate time to actually set up a business?
What you're really asking is "when should I setup complicated legal structure to represent my business"?
Are you making money? If not, then you don't need complicated legal structure.
Are you making a lot of money? If not, then you probably don't need complicated legal structure.
Even if you make a lot of money but are a solo owner, they you don't need complicated legal structure.
Note "need" vs. "want". There are "want" reasons to setup complicated legal structure even if there's no "need" reason.
I've been selling software under DBA (sole proprietorship) because setting up and maintaining an LLC (which is the simplest/cheapest business structure) is an expense and time sink.
DBA allows me to sell under a fictitious name (e.g. "Awesome Software" vs. using my name like "John Doe") but is trivial to establish and very cheap.
So when do you need establish a business structure?
Do you have partners? Investors? Will hire people? Your accountant told you can save on taxes if you setup LLC or S-Corp?
Those are good reasons to setup complicated legal structure.