713 karma · joined August 22, 2008
I don't understand why these VC's don't just create a corporation to buy stock in a LLC's. I know for a fact that at least some venture firms do this (I worked at one that did). A corporation can own stock in an LLC, and corporations (when the elect to be a C-corp, which I assume the VC would do) don't generate pass through income.
The only explanation I can think of is perhaps if someone is making small, angel or YC style investments. Then, the administrative cost of setting up and maintaining an additional "blocker" corporation for each investment would be significant in comparison to the total dollars invested.
I am very curious to know what the reason that firms that are investing hundreds of thousands if not millions of dollars don't do this.
Costs beyond that are lawyer's time for doing a trademark search and filing the paperwork. I used a lawyer (and ended up spending about $1,200 including filing fees), but you can also file it yourself if money is tight.
I think it's definitely worthwhile. The odds of having to make use of your trademark are low, but having the trademark is extremely valuable if someone comes out with a similar product or service with a similar name.
http://themetricsystem.rjmetrics.com/2009/01/22/rjmetrics-vs...
For the record, we use Google analytics and of course we are ravenous consumers of our own dogfood.
Summary: Fancy this: racetracks that keep 93% of your money and return only 5% in winning tickets. They wouldn't last long, not unless they could somehow rig the rules to both forbid price competition and make the purchase of race bets mandatory. That's more or less what the title insurance industry has done to American homeowners.