Delaware C-Corp
The default legal entity structure for US venture-backed startups, chosen for its well-established corporate law and investor familiarity.
A Delaware C-corporation is the standard legal structure for venture-fundable US startups, distinct from an LLC or S-corp, because it allows multiple classes of stock (needed for preferred equity in venture rounds), has no restriction on the number or type of shareholders, and operates under Delaware's well-developed body of corporate law, which most institutional investors and their lawyers are already deeply familiar with.
'C-corp' refers to the entity's federal tax classification, meaning the company itself pays corporate income tax, and shareholders are taxed again on dividends or capital gains — double taxation in theory, though venture-backed startups rarely pay dividends and the structure's fundraising benefits far outweigh this tax consideration for companies planning to raise institutional capital.
Incorporate as a Delaware C-corp from day one if you intend to raise venture capital — converting later from an LLC or another state's corporation is possible but adds real legal cost, delay, and complexity right when you're also trying to close a fundraise.
Why do venture investors require a Delaware C-corp specifically?
Delaware's corporate law is extensively developed and predictable (through decades of case law and a specialized Court of Chancery), investors' legal teams already know it well, and only a C-corp structure supports the multiple classes of preferred stock venture financings require.
Related terms
Run the numbers yourself: dilution, SAFE conversion, and fund-returner calculators.