A recent article in the New York Times provides a reminder of how flexible and versatile limited liability companies have become.
Facebook CEO Mark Zuckerberg and his wife recently announced that they would eventually give away 99% of their shares of Facebook during their lifetimes. When they said that they would use a company to implement this plan, most people would have expected that entity to be a non-profit corporation. But Mr. Zuckerberg and his wife, Dr. Priscilla Chan, decided to use a Delaware limited liability company to help implement their strategy. An LLC will provide more flexibility for investing in for-profit social enterprises and also for supporting certain political activities.
The key point is that when the Facebook CEO and his wife wanted a flexible business entity–they chose a limited liability company.
LLCs are not the only option for new business ventures. But they are often a good choice. Keep in mind that state LLC statutes can have significant variations. Mr. Zuckerberg and his wife chose a Delaware LLC; and I am certain their advisors made that choice after a careful analysis of many different factors. But even for those with far less net worth than Facebook’s owner — a limited liability company is frequently a good choice for a new business related activity.