There are a number of legal alternatives when forming a new business, including limited liability company (LLC), S-corporation, C-corporation, partnership, limited liability partnership (LLP), and professional services corporation. The two most common forms for tech startups are LLCs and C-corporations (or specifically, Delaware C-corporations).
The differences between these companies include tax treatment (i.e., LLCs, partnerships, and S-corporations are not taxed at the entity level), and structural flexibility (LLCs and partnerships are more flexible entities than traditional corporations).
C-corporations may have some advantages over LLCs, especially if you plan to raise outside investment. Many investors (such as venture capital funds) do not want to, or cannot, invest in entities such as LLCs and S-corporations which are disregarded for tax purposes (i.e., not taxed at the entity or corporate level).
We can help you assess which entity type is best given your immediate business needs and long-term goals.