Company Formation

a) Use your company name on the Business Plan.

b) Develop a company identity.

c) Have a legal entity to which you can allot expenses and accounts.

What type of company formation?

As this guide is, multicountry it is more difficult to be specific but all countries have similar types of companies outlined below.

Private Entity - You Yourself

This normally requires very little work, usually registering with the tax authorities of your country. However, there is very little protection in law and the status and customer perception may not be suitable for your area of business.

Partnerships - You and your friend

This can be two or more people, often named after the partners for example Rolls Royce, Harland and Wolf etc. Partnerships are sometimes registered separate legal entities although both or either of the partners is responsible for any debts or liabilities of the company.

Private Limited Liability Company (Ltd or LLC)

The latter is frequently the course of action taken as the company itself is a legal entity and can sue or be sued, own property in its own right and raise capital. Shares can be bought and sold privately. This is normally the best option to give some status to the enterprise. It can have as many shareholders as needed.

Public Limited Company (PLC)

This form of company formation is similar to the Ltd Company but can be traded on exchanges, it is perceived as the most trustworthy of the company setups but the downside is that there must be a considerable balance of cash in the account, as stipulated by local regulations. In addition, a considerable amount of paperwork is needed and usually a qualified accountant must be part of the company.

The above is only an outline; there are many slight variations in different countries. More information is available online for several countries there are also many sites which describe the benefits or otherwise of each category.

I would also suggest developing a company identity at this stage, a logo letterhead and business cards etc.; this will make communications more effective. It may also be worth considering preparing a Web Site although it is largely dependent on the Idea and your concept for the business.