Published on November 10, 2024

How to Incorporate Your Business in 2024: A Comparison of Stripe Atlas vs Clerky

Starting a business is an exciting venture, but navigating the incorporation process can be daunting. In 2024, two popular services that have emerged to simplify this process are Stripe Atlas and Clerky. In this comprehensive guide, we'll walk you through how to incorporate your business and compare these two leading platforms to help you make an informed decision.

Understanding Business Incorporation

Before diving into the comparison, let's briefly review what incorporation means. Incorporating your business creates a separate legal entity, offering personal liability protection and potentially beneficial tax structures. The process typically involves:

1. Choosing a business structure (e.g., LLC, C-Corp)
2. Filing formation documents with the state
3. Obtaining necessary licenses and permits
4. Setting up a business bank account
5. Complying with ongoing legal requirements

Now, let's see how Stripe Atlas and Clerky can help with this process in 2024.

Stripe Atlas: Overview

Stripe Atlas is a service offered by the payment processing giant Stripe. It's designed to help entrepreneurs form a C Corporation in Delaware quickly and easily.

Key Features:

• Incorporation in Delaware as a C Corporation: Ideal for startups looking to raise venture capital.
• EIN Obtainment: Helps you get your Employer Identification Number effortlessly.
• Stock Issuance: Simplifies the process of issuing shares to founders and investors.
• Basic Post-Incorporation Documents: Provides essential documents needed after incorporation.
• Stripe Account Setup: Seamless integration with Stripe's payment processing services.
• Access to Exclusive Deals: Offers discounts from partner services beneficial for startups.

Pricing:

• One-time fee of $500

Clerky: Overview

Clerky is a legal technology company focused on startups. They offer a range of services beyond just incorporation, catering to various startup legal needs.

Key Features:

• Incorporation as C Corporation or LLC in Any U.S. State: Provides flexibility based on your business needs.
• Comprehensive Set of Formation Documents: Ensures all necessary paperwork is covered.
• Ongoing Legal Document Generation: Helps maintain compliance with state laws as your business grows.
• Cap Table Management: Simplifies equity management for founders and investors.
• Flexible Entity Choices: Allows you to choose between different types of entities based on your goals.

Pricing:

• Startup Formation Package: $799
• Additional services priced separately.

Stripe Atlas vs Clerky: The Comparison

1. Entity Types and Flexibility

• Stripe Atlas: Limited to C Corporations in Delaware, which may not suit all businesses.
• Clerky: Offers both C Corporations and LLCs in any U.S. state, providing more options for entrepreneurs.

2. Comprehensiveness of Services

• Stripe Atlas: Focused primarily on incorporation and initial setup, making it straightforward but limited in scope.
• Clerky: Provides a wider range of ongoing legal services for startups, making it suitable for those needing more than just initial incorporation.

3. Post-Incorporation Support

• Stripe Atlas: Offers limited post-incorporation support, mainly focused on initial setup.
• Clerky: Extensive ongoing support and document generation, which is beneficial as your business evolves.

4. Integration with Other Services

• Stripe Atlas: Seamless integration with Stripe's payment services, ideal for tech-focused businesses.
• Clerky: Primarily focused on legal aspects, with less emphasis on integration with other business services.

5. Target Audience

• Stripe Atlas: Best suited for tech startups planning to raise venture capital and operate primarily online.
• Clerky: Suitable for a broader range of startups with varying legal needs, including those seeking flexibility in their business structure.

How to Choose Between Stripe Atlas and Clerky

Consider the following factors when making your decision:

1. Business Model: If you're a tech startup planning to raise VC funding, Stripe Atlas might be more aligned with your needs due to its focus on C Corporations.
2. Location Preferences: If you want to incorporate outside of Delaware or need an LLC structure, Clerky offers more flexibility.
3. Long-term Legal Needs: If you anticipate ongoing legal document requirements or plan to grow significantly, Clerky's comprehensive services might be more suitable.
4. Budget Considerations: Compare the pricing structures based on what services you'll need beyond initial incorporation.
5. Payment Processing Needs: If integrating with Stripe's payment system is crucial for your business model, Stripe Atlas offers a seamless solution.

Conclusion

Both Stripe Atlas and Clerky offer valuable services for entrepreneurs looking to incorporate their businesses in 2024. Stripe Atlas provides a streamlined solution for tech startups focused on Delaware C Corporations, while Clerky offers more flexibility and comprehensive ongoing legal support.

Ultimately, the choice between Stripe Atlas and Clerky depends on your specific business needs, future plans, and preferences. Whichever service you choose, both can significantly simplify the incorporation process, allowing you to focus on building and growing your business.

Remember, while these services can greatly assist in the incorporation process, it's always advisable to consult with a legal professional to ensure all aspects of your business formation align with your specific circumstances and goals.