I have an established LLC to support my DupDup app, and I have given equity to an investor and a Co-founder. Now, I have another idea, and able to convinced two co-founders (technical, and financial). That being said, should I register new LLC or is it safe and wise to keep current LLC , and split equity based on startup ideas.
At the end of the day, you share Company (LLC) equity not ideas - You can have as many startup ideas under sole LLC.
If I was your investor, your question would scare me out of investing any more in you!
The top two reasons companies fail are:
By changing ideas you are showing both of these. Note, this is different from pivoting with good reason.
You are signaling that you won't stick with your ideas if things get difficult, which they will and also that you prefer shiny objects.
This depends on: 1) is it complementary to your current business so could be a competitor, 2) will you spend time on it that should be spent on DupDup, and 3) will you use your current LLC resources on the new venture?
If it is any of the 3, then you should keep it in the current LLC. If it is none, then start a new one and keep them separate. However, if it is separate, you need to be totally transparent with your current LLC partners so they do not feel you took a corporate opportunity from them to which they were entitled.
By the time you finished writing this, chances are you are going to come up with another idea.. So here’s the deal, just because LLC is easier and less-costly to form doesn’t mean you should go about forming LLCs.. Stick to this one and make that new idea a project first.. Until it matures into something it’s just another idea and should not warrant vesting with out-of-line resources..
after maturity, you can talk about either changing the former LLc Operations, filing a new one as a separate entity, or filing as sub-LLC to precious one.
Thanks you guys! I am inclining towards @Ema`s suggestions. We are struggling with budget, and I cant take a risk to open another LLC , until I have idea validation.
We are trying to find investors (24/7) for my existing DupDup App idea through a co-founder I hired recently in Silicon Valley!
My only concern is raising capital for the new + old idea - That may become tricky! Well.. maybe we shall evaluate once we crossed this bridge!
@Dane Answers to all three questions are "No" - -
@ Brendon Thanks, I am just trying to test the water with another completely different idea, while still spending a good amount of time with my current app.
I am at the stage of exploring ways to make the new idea MVP build in a shoelaces budget if possible. ( Already signed the dotted line with technical resource based off equity).
Have a magical weekend!