January 30, 2025 • 33 mins
Description: Delaware has been the go-to state for incorporating businesses due to its business-friendly environment, strong case law, and lack of business taxes.
The recent court case involving Elon Musk's compensation package has raised questions about Delaware's predictability and has prompted some companies to consider alternative states like Texas, Wyoming, and Nevada.
While Delaware will likely remain a popular choice for incorporation, especially for larger companies, the changing landscape prompts companies to consider their options and consult with legal and financial advisors.
Businesses must focus on their core operations while being aware of the legal and financial implications of their structure and location choices.
00:00 Introduction and New Year Greetings
00:50 Reflecting on 2024 Achievements
01:06 Trending Topic: Delaware's Business Appeal
01:25 Elon Musk's Compensation Controversy
02:43 Why Delaware? Historical Context
05:49 Recent Legal Shifts in Delaware
07:02 Emerging Alternatives: Texas, Wyoming, Nevada
12:59 Legal Nuances and Case Law
19:51 Practical Implications for Businesses
27:07 Future Outlook and Strategic Considerations
28:58 Advice for Founders and Business Owners
33:19 Conclusion and Final Thoughts
==============================
🎙 Podcast – Strategies, PE 101 & witty banter
📚 Book – On‑Ramp to Exit, full deal life cycle
🛠Resources – Free templates, guides, tools
🔗 LinkedIn – Follow us for fresh PE insights
================================
Who Are We?
Three insiders. One mic. All things private equity — explained. Hi 👋 We’re Ed, Rory, and Emily — a CEO, a CFO, and a Chief of Staff — here to demystify the world of private equity. Between us, we’ve sat in the founder’s chair, run PE‑backed companies, and worked on the deal side, so we know the wins, the pitfalls, and the jargon (and we’ll explain it).
Through the Private Equity Experience Podcast, our book On‑Ramp to Exit, and a library of free tools and templates, we share real‑world stories, practical strategies, and insider insights to help you navigate every stage of the PE journey — whether you’re leading a portfolio company, joining a deal team, considering PE, or just PE‑curious.
🔗Connect with Ed
...Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
emily-sander_1_01-14-2025_1 (00:34):
All right.
We are back with the privateequity experience podcast in
this, in this new, new year,2025 ed, Rory, how's it going?
squadcaster-a3hb_1_01-14- (00:44):
Busy, busy, busy.
squadcaster-9281_1_01-14- (00:45):
Feels just like 2024 so far, but, but
I guess
emily-sander_1_01-14-2025 (00:50):
We're with
squadcaster-9281_1_01-14-20 (00:50):
You know, 2024 was a good year.
I'd say overall.
So
emily-sander_1_01-14-2025_160 (00:54):
a good year.
We wrote a book and we startedthis podcast.
So it was a great
squadcaster-9281_1_01-14-2025 (00:57):
I mean, that blows my mind.
It all came together verynicely.
Yeah.
Proud of that, actually.
emily-sander_1_01-14-2025_1 (01:05):
for sure.
All right.
So we're going to break down oneof our trending topics today.
There was a story that hit thenews wires.
I'm going to try to like, Teethis thing up as, as best I can.
So context, Delaware has longbeen the go to state for
incorporating businesses for avariety of reasons, which we'll
outline.
(01:25):
There was a recent court casewith Elon Musk.
And, uh, I think it was like amassive compensation package
that was denied in some ways.
And this is now putting intoquestion, um, Is Delaware the go
to state in particular, like theVC and PE firms and lawyers who
would recommend, uh, kind ofwhere we'd have a tax footprint.
(01:48):
So that's kind of my like rough,rough grab at like what this
article was outlining, but maybewe can just start with like,
why, why is slash was Delawarethe go to
squadcaster-9281_1_01-14- (02:00):
well, first, let's just like note the
old life adage that the squeakywheel gets the grease and you
know, that the article youtalked about was all about Elon
billion comp package that gotdenied.
And I think that was the saberrattling that, sent
emily-sander_1_01-14-2025_1 (02:14):
Did you say billion or million?
squadcaster-9281_1_01-14-2025 (02:16):
a B.
squadcaster-a3hb_1_01-14-202 (02:17):
B.
squadcaster-9281_1_01-14- (02:18):
Yeah.
emily-sander_1_01-14-2025_ (02:19):
Holy cow.
Okay.
squadcaster-a3hb_1_01-14 (02:20):
stock, it was stock compensation.
squadcaster-9281_1_01-14- (02:22):
Yeah.
squadcaster-a3hb_1_01-14-202 (02:23):
So again, the
emily-sander_1_01-14-2025_1 (02:24):
Oh,
squadcaster-a3hb_1_01-14-20 (02:25):
for it to actually be worth what it
was worth.
squadcaster-9281_1_01-14 (02:27):
Right.
But
emily-sander_1_01-14-2025_16 (02:29):
So even for Elon Musk, that's okay.
So Elon
squadcaster-9281_1_01-14-2 (02:32):
gets all the media outlets and that
becomes the source of all this,you know, call it intellectual
discourse on the matter.
That's really been, you know,it's, it's been a discussion
point for many, many years.
You know, why Delaware?
What is it about Delaware thatmakes it, uh, You know, so
business friendly,
emily-sander_1_01-14-2025_ (02:50):
Musk has brought us to this place.
Thank you, Elon.
Um,
squadcaster-9281_1_01-14- (02:53):
know,
emily-sander_1_01-14-2025_ (02:57):
even for Elon Musk, 55 billion is
like real money.
So, okay, I get it.
Um, so why, so why,
squadcaster-a3hb_1_01-14-202 (03:04):
Go
emily-sander_1_01-14-2025_16 (03:04):
Is Delaware.
Yeah.
squadcaster-a3hb_1_01-14-20 (03:06):
me, let me preface this by saying
that Elon Musk brings us here,not necessarily because of, his
compensation
squadcaster-9281_1_01-14- (03:16):
Yeah.
squadcaster-a3hb_1_01-14-2 (03:16):
and, and But really, Delaware has
been really attractive forcompanies to incorporate in or
form their LLCs in for a coupleof different reasons.
The biggest one, and this isreally where the Elon Musk thing
kind of threw a spanner in theworks, is the Delaware, uh,
Chancery Court is, um, Beenhandling business basically back
(03:38):
about 150
squadcaster-9281_1_01-14- (03:40):
Yeah.
squadcaster-a3hb_1_01- (03:40):
Delaware made the determination, Hey,
look, we're going to be spot forbusiness.
They were the headquarters ofDuPont.
They had, they had a reallystrong kind of, kind of business
culture.
And they said, we're going tomake a.
Make our state the most friendlybusiness business friendly state
in the country used to be a lotof companies were incorporated
in New York Delaware becamepreferable and a lot of that
(04:02):
preference is due to the courtof Chancery, which is they had
such strong case law
squadcaster-9281_1_01-14- (04:09):
Yeah.
squadcaster-a3hb_1_01-14-20 (04:09):
was Both business friendly and was
setting a really strongprecedent that the cork chancery
tended not to overturn that whenyou incorporate it in Delaware,
you've got not only some taxbenefits because they don't have
business, uh, Business incometaxes.
They don't have business salestaxes.
They don't have, um, you know,they don't, they don't, they're
(04:32):
really relatively costeffective.
Um, especially if you don't dobusiness in Delaware.
If you do business in Delaware,you have business, uh, Delaware
squadcaster-9281_1_01-14- (04:39):
Yeah.
Yeah.
squadcaster-a3hb_1_01-14 (04:40):
don't, you don't pay Delaware income
tax.
There's, um, a lot of privacy.
issues in Delaware where theybasically go, look, we, we
don't, you don't have todisclose on all your filings and
it's not public publiclyavailable who the owners are,
who the officers are.
It's, it's kind of opaque.
And so as a result, the, and achancery court has built this
(05:01):
Big block of case law that wasconsidered to be kind of circus
sancte.
And
squadcaster-9281_1_01-14-2 (05:07):
Yep.
squadcaster-a3hb_1_01-14- (05:07):
could predict what was going to happen
if you did something inDelaware.
It's likely been done beforethat case law holds and for the
bulk of.
Business transactions state lawgoverns, not federal law.
So a lot of times you might findyourself in federal court
squadcaster-9281_1_01-14-2 (05:24):
not, but yeah,
squadcaster-a3hb_1_01-14-20 (05:25):
got kind of what they what they
called diversity of citizenshipwhere you've got citizens of
different different states andyou've got a, uh, a large enough
amount at dispute where it goesinto federal court.
But a lot of contracts arewritten to kind of force you
into, into Delaware state court.
Um, because the court ofchancery is, is so reliable.
(05:48):
The outcomes are so reliable.
And where the Elon Musk thingreally kind of threw Spanner in
the works.
And there's been a couple othercases as well.
And I'll talk about one that Iwas, I was part of, um, in my
prior life, um, is Dave.
Change some of the, they'reoverruling some of their old
cases or they're giving somekind of curve ball case law.
(06:08):
Um, recently in the last four orfive years, that is making
Delaware less predictable as faras what the courts are going to
do.
And the privacy, um, privacylaws in, you know, both
federally with the, with the,uh, The Corporate Transparency
Act, as well as, you know, atthe state level, are making it
(06:29):
more, you know, less attractivefrom a privacy perspective.
So while Delaware still has alot of advantages, um, some of
these recent court cases havecalled to question whether that
circus sanct set of case lawthat everybody relies on for
incorporation, for business, forbankruptcy, for all those
things, whether that's actuallygoing to continue to hold or
(06:50):
whether, you know, there's goingto be some, some new, uh,
precedent set and, and makesDelaware a lot less predictable
and therefore a lot lessattractive for, uh, investors
and, and incorporators.
Yeah.
squadcaster-9281_1_01- (07:02):
exactly.
And now when there's an openingon something like that, for the
reasons I just mentioned abouttransparency, then, you know,
you have other States that wantto have that kind of status to
where very business friendly,you got Texas, Wyoming, or.
Three that, you know, there'sbeen a lot discussed, but I'd
say that case precedent is soimportant here.
Um, and, that, that may be, youknow, a barrier, but I'd, I'd
(07:26):
say, you know, certainly you'rehearing less and less, or at
least, you know, I, you know.
Even in recent years, I've beenadvised less and less.
I automatically defaulted to anyentity on formula.
We're just going to form inDelaware.
It's like, well, well, why, youknow, like there's other states
that are just as friendly anddoesn't necessarily need to be
Delaware.
It's just become so ubiquitousthat, you know, folks always
(07:47):
default to that.
emily-sander_1_01-14-2025 (07:49):
Okay.
So Delaware was the like defaultgo to place, and they
intentionally tried to makethemselves attractive to
business.
And there is this like case lawwhich I'm taking as like just
like precedent for like, this isthis is how we do things in
Delaware, it sounded like likeother states might be, you know,
Didn't strict and stingy onthese things, but come to
(08:10):
Delaware and we'll take care ofyou.
We'll predictably, uh, uh, go inyour favor.
And then recently there's beenones where it's like, Whoa,
okay.
That usually doesn't come out ofDelaware.
And then can someone justbriefly break down?
Like, what was this Elon Musk?
Uh, 55.
8 billion thing.
Was it like, normally he wouldhave gotten paid out on that
(08:31):
under state law in Delaware.
And then he didn't, or what,what happened in that case?
squadcaster-a3hb_1_01-14-2 (08:35):
I'll give a general overview.
Um, so on the, on the Delaware,on the Delaware case,
essentially what Elon Musk didwas he took a, when he took over
Tesla, Tesla was a struggling,struggling company.
They weren't doing all thatwell.
Um, and he took as compensationequity.
So again, typical of a founder,typical of a early stage
(08:58):
investor, he took equity as thenext video.
As his compensation, um, in lieuof a bunch of cash comp, well,
what ended up happening was hedrove the value of that business
up so high that that equityturned into billion of
compensation and he was sued,not by the shareholders who
approved it.
(09:19):
Not by the board of directorswho approved it, but actually by
kind of independent folks whosaid, you know, this is an, this
is a ridiculous amount ofcompensation for what you've
done and therefore it's illegalunder Delaware law.
emily-sander_1_01-14-2025_1 (09:33):
But he made the company from
scratch.
It's more like what?
squadcaster-a3hb_1_01-14-20 (09:36):
the company from scratch.
He came in, the company wasfounded by others, but he came
in early stage when they werereally struggling and put them
on the path that they're ontoday.
emily-sander_1_01-14-2025_1 (09:45):
And some independent something
entity party in Delaware said,no, you don't, you don't get
that.
squadcaster-a3hb_1_01-14- (09:53):
Yeah, essentially, essentially
emily-sander_1_01-14-2025_ (09:54):
man.
squadcaster-a3hb_1_01-14-2 (09:55):
what happened, um, was there was a.
Compensation package that heagreed to in 2018.
So pre COVID, um, that wasequity based and it essentially
was driven by his ability to beable to add value into, into
Tesla.
(10:16):
And as a result of that.
you know, as a result of theperformance of Tesla since 2018,
the value of that turned intoover 56 billion, the equity, the
equity value.
And what, um, what ended uphappening was the court said
(10:39):
that was an egregious amount ofcompensation for you to receive.
Based upon the structure of the,the deal.
And therefore you wereovercompensated.
It was unfair and, and we shouldget that back.
emily-sander_1_01-14-2025 (10:55):
Okay.
I have lots of questions abouthow they came to that, but for,
for this, okay.
That decision was made.
squadcaster-9281_1_01-14-202 (10:59):
to see,
squadcaster-a3hb_1_01-1 (11:00):
people,
emily-sander_1_01-14-2025 (11:01):
Yeah.
Um, okay.
So, and then Rory, youmentioned, like, since this has
happened, some other states arepopping up on the radar being
like, Hey, like, what aboutTexas or Nevada or Wyoming?
I think it was, um, these arenow coming on people's radar are
like, why are those in therunning?
And like, are those viableplaces for people to look at?
squadcaster-9281_1_01-1 (11:22):
reasons that are, you know, generally
kind of the, the, the reasonscited by business friendly
environments for many reasons,you know, a low regulatory
environment.
You know, no corporate incometax.
That's probably the biggest one.
You know, when you, when you seeabout where corporations
domicile, that's the big one.
Um, another one that's nottalked about too much, but
(11:46):
probably talked about more inthe last.
To say, since 2008 and beforethat is, you know, director and
board member liabilityprotections against those
things.
those are, those are some of thekey reasons.
And those 3 states thatmentioned Texas, Wyoming, Nevada
are all friendly in that regard,as opposed to like saying.
(12:07):
You know, planning your flag inCalifornia or things like that,
you know, other that are on theother side of the equation.
So, um, those are, those are themain reasons, um, that get cited
for, for wanting, for beingbusiness friendly, generally
speaking.
emily-sander_1_01-14-2025_1 (12:21):
And when you mentioned like
domicile, and then, and I thinkyou referred to like, if, Okay.
If you are located, likephysically located in Delaware,
different things, um, occur, butwe're talking about, like, let's
say you're headquartered in, Idon't know, like, Florida or
like Washington State, becausewe're in Washington State, but
then your business isincorporated in Delaware.
(12:42):
That's kind of the setup we'retalking about.
squadcaster-9281_1_01-14 (12:44):
refers back to, like Ed said, to where,
where, you know, where domicileis, where that, where it's going
to be litigated or whether,where, what case law is, or
what, uh, what law is going tobe applied, state law.
Yeah.
In that regard.
squadcaster-a3hb_1_01-14-202 (12:59):
So the, so in general, like for
instance, if I was a, if I was acompany operating in Washington,
I could be incorporated inDelaware.
And so Delaware is my state ofcitizenship.
Cause again, for
squadcaster-9281_1_01-14- (13:11):
Yeah.
squadcaster-a3hb_1_01-14-202 (13:12):
of the law.
Companies are considered to beseparate.
squadcaster-9281_1_01-14-2 (13:17):
hmm.
squadcaster-a3hb_1_01-14-2025 (13:18):
I don't want to say individuals,
but they're separate legalentities.
Um, so they have their owncitizenship.
They have their own, you know,it's, it's kind of an
interesting, interesting legalfiction.
Um, but they then have toregister as a foreign
corporation in the state ofWashington.
So they essentially go, I'mincorporated in Delaware, but in
order to do business in thestate of Washington, they
(13:38):
register as a foreigncorporation in the state of
Washington.
They pay Washington.
you know, percentage of
squadcaster-9281_1_01-14-202 (13:44):
Mm hmm.
squadcaster-a3hb_1_01-14-20 (13:44):
pay
squadcaster-9281_1_01-14-20 (13:45):
You know.
squadcaster-a3hb_1_01-14-2 (13:45):
fee.
But to Rory's point, the, at theend of the day, they are
considered a citizen of thestate of Delaware for the
purpose of, for legal purposes.
And so while they may be drawnin the court in the state of
Washington, because of a tort,for instance, they, they, there
was a, an issue and they gotsued by a Washington state
resident and they get drawn intoWashington state courts.
(14:07):
If most of their contracts aregoing to be.
the state of Delaware andthey're going to use Delaware
law and potentially, potentiallyDelaware venue, which is kind of
where
squadcaster-9281_1_01-14 (14:18):
Right.
squadcaster-a3hb_1_01-14-202 (14:19):
to be, going to be, or where the
law, the case is going to beheard.
so it really brings that bigpile of Delaware, um, history
and precedent into, into playwhen I, when the cases are
settled.
Now I'm going to, I'm going toroll a lawyer kind of kind of
thing in here where you can be aWashington state company.
(14:41):
and be a Washington stateresident, then agree to Delaware
law and a Washington venue.
So I've, I've been part of alitigation that was in Oregon.
venue was in Oregon, the lawthat was being applied was
Delaware law
squadcaster-9281_1_01-14-2 (15:00):
Hmm.
emily-sander_1_01-14-2025_1 (15:01):
Oh.
squadcaster-a3hb_1_01-14-202 (15:01):
of Oregon between two Washington
residents.
emily-sander_1_01-14-2025_16 (15:05):
Do the lawyers in Oregon know that
law?
squadcaster-a3hb_1_01-14-20 (15:08):
Um, so interestingly, you've got the
law, the lawyers, generally onthe, on the commercial side.
So if you're doing commerciallitigation, a lot of them are
going to be familiar enough withDelaware law to be
squadcaster-9281_1_01-14- (15:20):
Yeah.
squadcaster-a3hb_1_01-14-20 (15:21):
And can always bring in Delaware
counsel.
The, the issue is going to bethe judge may not be familiar
with
emily-sander_1_01-14-2025_1 (15:28):
Oh.
I don't know.
squadcaster-a3hb_1_01-14-20 (15:29):
And if it's a federal case, the
federal courts, you know, aren'tgoing to, aren't going to say
it's Delaware law.
You're going to have federal lawis going to be, is going to
govern.
However, the, uh, You know, oneof the disadvantages of Delaware
is the Delaware lawyers knowthat Delaware is, so I had a, I
had a case, I mentioned thisearlier.
I had a case where we had acontract with an employee that
(15:52):
was under Delaware law, so wesued that employee in Delaware,
and that, that employee was aresident of the state of
Michigan, the company was aresident of the, was a, was a
Delaware company, The companywas headquartered in Florida.
And so we had to hire Delawarecouncil and the Delaware council
(16:13):
cost twice as much as New
emily-sander_1_01-14-2025_1 (16:15):
Oh, I see.
squadcaster-a3hb_1_01-1 (16:16):
they've
emily-sander_1_01-14-2025_ (16:16):
they know people need them.
squadcaster-a3hb_1_01-14-202 (16:18):
a, a, a corner
squadcaster-9281_1_01-14- (16:19):
Well, yeah.
Yeah.
squadcaster-a3hb_1_01- (16:20):
admitted to the bar in Delaware.
So they they've, you know, itcost us a small fortune.
And that was another one, um,where from a Delaware, from a
Delaware perspective, had newcase law pop up, um, on non
competes.
And that was,
squadcaster-9281_1_01- (16:36):
remember that.
I remember that popping up.
Yeah.
squadcaster-a3hb_1_01-14-2025 (16:39):
a Delaware non compete and there
was a recent, there was a coupleof recent rulings.
The one that we got hit withwas, uh, Intertech versus
Eastman, where they basicallysaid, you know, you, you, we're
not going to enforce.
Um, and then there's anotherone, century and service group
where they, the, the court said,we're not going to enforce the
non compete now, non competeshave been enforceable in
(17:01):
Delaware for a hundred years.
And so this, this kind of threwa spanner in the works for us.
And in addition, the.
Delaware court was extremelydeferential to what was a pro se
So essentially our employeerepresented himself, even though
he really didn't representhimself, but he didn't, he had,
he had a Michigan attorneyhelping him on the side and then
(17:23):
he walked in without theMichigan attorney into Delaware
court.
emily-sander_1_01-14-2025_ (17:27):
That doesn't sound like a smart thing
to do.
squadcaster-a3hb_1_01-14-20 (17:29):
And judges and
squadcaster-9281_1_01-14 (17:30):
That's amazing.
Pro se with an asterisk.
Yeah.
Yeah.
Yeah.
Oh, I was
squadcaster-a3hb_1_01-14- (17:33):
yeah, very sympathetic to pro se folks
who have their crap together.
Um, and so we ended up basicallyhaving to settle for a fraction
of what we should have, uh,settled for because the, the
Delaware courts had essentiallychanged the From the time we
entered into that agreement,know, four years prior to the
time we litigated it, couple ofcases, these couple of cases had
(17:55):
come through and basicallythrown out non compete law in
the state of Delaware, except invery narrow circumstances.
And it's, you know, that's,that's an issue.
emily-sander_1_01-14-2025_16 (18:03):
So with these sweep like changes,
do they have just a flood of newcases being brought to them?
Because they'll be like, Oh,actually, if you're not going to
do that, then I have a case.
If you're not going to enforcethat.
squadcaster-a3hb_1_01- (18:13):
Delaware always has a lot of cases and
what's, what's
squadcaster-9281_1_01-14- (18:16):
going to think it was maybe a little
bit different in so far as Youknow, because of all the case
precedent, you know, outcomeswould be more predictable.
So people would be less, uh,inclined to, you know, burn
money on litigation.
Whereas now I'm thinking Texas,Nevada, Wyoming, open their
doors, more business corporate.
They're the only people lickingtheir chops are the lawyers
because they don't have the caseprecedent.
You're relitigating basicallythat comes up in material ways.
(18:39):
Is that, I mean, how, how doesthat thought process, is that
logical?
squadcaster-a3hb_1_01-14-20 (18:42):
in.
No, and in Delaware, what folkshave tended to identify, they've
identified that there's been asubtle and some now not so
subtle shift in the courts.
And so you're seeing morelitigation to try and get
various business friendlypositions overturned.
Additionally,
squadcaster-9281_1 (19:00):
interesting.
squadcaster-a3hb_1_01-14-2 (19:02):
You, you've got attorneys now on the
business side who are, andagain, we kind of went through
this in our, in ours as well,
squadcaster-9281_1_01-14- (19:09):
Yeah.
squadcaster-a3hb_1_01-14-20 (19:09):
you know, we're not going to
litigate it, not because wedon't know what the outcome is,
but because we don't know whatthe outcome is.
And we don't necessarily likeour attorneys were like, look,
we don't want to put badprecedent on the books.
emily-sander_1_01-14-2025_1 (19:22):
Oh.
squadcaster-a3hb_1_01-14- (19:22):
know, it's better for us to settle
this because they could continueto continue to move the
goalposts on us and move it towhere it's worse for everybody
else.
Um, and so, You know, there'sright now, there's a little bit
of a, the, the one side isgoing, okay, how far is this
going to move?
How far can the goalposts move?
And the other side is going, canwe settle some of this stuff so
that we don't get additionalprecedence on the books that are
(19:44):
moving the goalposts furthertoward, um, non business
friendly positions.
emily-sander_1_01-14-2025_16 (19:50):
So
squadcaster-9281_1_01-14- (19:51):
Yeah.
Hmm.
emily-sander_1_01-14-2025_ (19:51):
does this all mean for VC and PE
firms and portfolio companies?
squadcaster-a3hb_1_01-14-202 (19:57):
As a, as a practical matter, I
think they're going to continuein the short run.
I think they're going tocontinue to use Delaware as a,
as a, Incorporation location ofchoice, um, because for all the
reasons we identified, um, I dothink what I, what I'm seeing,
um, in dealing with some of thefolks is Nevada has become kind
of a, uh, a number 2 choice,particularly here on the West
(20:19):
Coast as a, as a incorporationlocation.
Um, I.
have had a couple of my clientswhere I've recommended that they
actually built make their LLCsin Wyoming.
Um, Wyoming's my favorite by, bya long shot.
Um, but the, but you know,Nevada, I think has become far
more, far more, uh, for a numberof reasons, including their,
(20:41):
including not only theircorporations, but their trust
law is, um, is very favorable aswell.
So for folks who are founders orwhere they're intending to hold
for estate planning purposes,intending to hold some of the
stock or interest in theirbusiness and a trust, um,
Delaware or Nevada allows for.
Even on an irrevocable trust,changes to be made by the
(21:02):
grantor, um, which, which is awhole different set of case law
that we could talk about with,with like the Fox News, Rupert
Murdoch and trying torestructure his trust and
allowing, and whether, you know,Nevada allowed him to
restructure his trust or not.
But that's, that's Nevada's kindof a, an up and
squadcaster-9281_1_01-14- (21:18):
Yeah.
squadcaster-a3hb_1_01-14-20 (21:19):
Um, the issue is none of these
states, Wyoming, Nevada, um, uh,to a lesser extent, Texas have
the body of case law that makesit as predictable.
So when you're going in thestate, you're going in a state
court in Sheridan, Wyoming,you're probably getting a little
bit different level of, ofengagement than you would when
you're going into a chancerycourt in Wilmington.
emily-sander_1_01-14-2025_1 (21:42):
Why is Wyoming your favorite?
squadcaster-a3hb_1_01-14-20 (21:44):
Um, from, from my seat, it's the,
you've got, uh, stronger privacylaws in Wyoming.
Their trust laws are solid.
Um, you've got, um, no stateincome tax, federal or no state
income tax for individuals, nostate income tax for business.
It's a low cost of, of, uh, LLCformation or corporation.
They've got a, and, and.
(22:05):
You know, for those of us hereon the west coast, it's
relatively
squadcaster-9281_1_01-14- (22:08):
Yeah.
squadcaster-a3hb_1_01-14-20 (22:09):
Um, so it's not, if you do have to
show up in court, you're notflying cross country.
Um, the downside to Wyoming isyou don't have a very strong, I
shouldn't say that.
You don't have a large bar.
So, you know, from an attorneyperspective or a CPA
perspective, there's not a tonof Wyoming attorneys and CPAs,
um, just'cause the state's sosmall from a population
(22:31):
perspective.
So you don't have the
squadcaster-9281_1_01-14- (22:33):
Yeah.
Yeah.
squadcaster-a3hb_1_01-14- (22:34):
level of support yet that you would
get out of a, you know, out of aDelaware, which draws on
Pennsylvania and, and Marylandand DC as well.
emily-sander_1_01-14-2025_16 (22:43):
So it sounds like.
If you become knowledgeableabout just like the general
landscape.
Of the tax implications for thisstate versus this state,
depending on what you're tryingto do.
If like you want to emphasis andlike, Hey, I do want to set up
trusts and I know that I'm goingto have generational wealth and
I want to make sure that's setup well for my family.
You might go to Nevada if you'relike, Hey, privacy law is
(23:06):
important or all these otherthings that are happening in
Wyoming, you might make astrategic decision to like, look
into those types of states.
Is that, uh,
squadcaster-a3hb_1_01-14-20 (23:14):
and you might have a choose your own
adventure piece where you'vegot, where you've got the
companies incorporated in, in.
but the stock is owned by aNevada trust or a Wyoming LLC
and because there's noprohibition for that.
So you can take the best ofeverything on your ownership
structure for state planningpurposes or asset protection
(23:36):
purposes.
You know, but again, Nevada,Nevada for trusts is probably
the most advantageous trust lawin the country.
Um, I think Wyoming on the LLCside is becoming kind of the go
to place for LLCs.
And, but I still think if you'regoing to end up going public, if
you're going to end up,expecting litigation.
(23:56):
If you're going to be a largerorganization, if you've got
institutional investors, you'reprobably still looking at
Delaware, you know, as difficultas the last couple of years have
been with some of the chancerycourt decisions.
Um, it's still got a huge amountof case law.
It's still far more predictableand it's got the infrastructure,
the legal, the accounting, the,the, The business infrastructure
(24:17):
to be able to supportinstitutional investors where
you know, Nevada, Wyoming, or,or, and even Texas are still
well behind in that
squadcaster-9281_1_01-14- (24:25):
Yeah.
emily-sander_1_01-14-2025_1 (24:27):
are there certain states that are
not favorable to Business likeyou mentioned California, but is
there something where it's like,hey, you have the
squadcaster-9281_1_01-14-2025 (24:34):
I think it would rival
emily-sander_1_01-14-2025_ (24:34):
like a
squadcaster-9281_1_01-14- (24:35):
them.
emily-sander_1_01-14-2025_ (24:35):
like a Like a P.
E.
backed, kind of like, you don't,like, you want to stay away from
this one just for certain typesof tax law.
squadcaster-a3hb_1_01-14-2025 (24:42):
I mean, I would, I would
generally, I would generallysay, um, if you are a local
company doing local business andare located and doing business
and predominantly in that state,you're probably, probably a
little disadvantage to in thatstate because you have, you have
(25:04):
to file as a foreign corporationanyway, if you're incorporated
in Delaware, you're still goingto be
emily-sander_1_01-14-2025 (25:08):
Yeah.
squadcaster-a3hb_1_01-14 (25:08):
there, et cetera.
If you're a multi, if you're amultinational or multi multi
state, then yes, there are oneswhere I would be like, you know,
I, as an, as an accountant or anattorney, I would advise you
might not be a good choice.
California kind of being at the
squadcaster-9281_1_01-14- (25:22):
Yeah.
squadcaster-a3hb_1_01-14- (25:23):
list, Illinois, New York,
Massachusetts, um, those aregoing to be kind of at the top
of the list of, you know, think,think again, whether that's
actually your best choice.
Um, and then, know, there's,there's on the flip side, um,
you know, if you'repredominantly doing business in
(25:43):
those states and you'resubjected to those laws and
those taxes anyway, to beincorporated in that state
actually will Potentially reduceyour costs because you won't
have additional filing fees forbeing incorporated there.
And if you're hauled into court,
squadcaster-9281_1_01-14- (25:57):
Yeah.
squadcaster-a3hb_1_01-14- (25:57):
going to have to hire Delaware council
to go represent you and fly downto Wilmington to go into
chancery court where you couldgo down the street and, you
know, be, and be in court in,you know, in the state, in the,
in your own local backseat orbackdoor venue.
squadcaster-9281_1_01- (26:11):
Probably depends a lot on the type of
business too.
You know, certain, I mean, nowwe're going beyond just, uh, You
talk about, you know, um, waysin which states lure businesses
with, uh, credits and, you know,other incentives and things like
that, you know, depending on thetype of business that you have,
whether it's, you know, energyor, uh, you know, technology or,
(26:34):
uh, or manufacturing that could,that could be different by state
too, depending on what theoffering to businesses like that
to, You know, be set up thereand so forth.
emily-sander_1_01-14-2025_16 (26:48):
So what does this mean for future
outlook?
For, like, what should people bepaying attention to?
We're kind of at this, like,well, this seems to be changing.
Delaware had a strong precedentfor a hundred years in these
areas, and now it might bechanging.
What should people be lookingout for?
And what, what do you think thefuture outlook is?
Is this like a watershed momentwhere like now these other
(27:09):
states are going to buildthemselves up to be the next
Delaware or, or whatever?
squadcaster-9281_1_01-14- (27:14):
Yeah, I don't know that I'd call this
watershed per se.
I think, you know, I think thisis something that's been
discussed more, but I think, um,you know, there have been
certain headlines that havebrought this to the floor a
little bit more.
But I think as far as what towatch out for is, I think it's,
it's as much about.
Minimizing risk is maximizingopportunities is some of these
(27:37):
states that step up to the plateto offer more incentives to, you
know, make it more friendly tocompanies to get set up, things
like that.
That could be more of anopportunity.
And, you know, you're talkingabout a business that Uh, it's
growing large in scale, youknow, even small margins on big
numbers make a big differencefor, for businesses and cost and
(27:58):
risk management and things likethat.
So I think this is just onewhere, you know, it's
interesting to kind of keepapprised, but it's also, you
know, if you're, if you'rerunning a business, Uh, if
you're a founder, uh, if you'resomeone that's, um, looking to
think about restructuring yourcompany in certain ways, this is
definitely something to beconnected with your, your
(28:19):
counsel on, you know, they'rethe ones that are, apprised more
than anything, as you see, evenon this call, Ed knows what's
up.
I'm learning a lot from Ed here,right on this call, you know, so
attorneys, attorneys stay on topof this stuff necessarily for
sure.
squadcaster-a3hb_1_01-14- (28:33):
Yeah, I would, I would say, um, I
would agree with Rory, notwatershed, but, um, the
landscape is, is changing alittle bit and for larger
organizations and institutionalinvestors, it's, I don't think
you're going to see a dramaticshift.
I think there's still a comfortlevel with, with Delaware, um,
that unless the, the court ofchancery gets kind of out of
(28:55):
control, I think it's going tobe, I think it's going to be
fine.
Um, for individual founders, um,thought process, a lot of them
incorporate or build their LLCin Delaware because they're
looking for, well, someday I'mgoing to get institutional money
and what have you.
As we've talked about in acouple other, uh, pods, the, you
(29:16):
know, they're likely to put ablocker C and they're likely to
put some other structuring inplace when they buy.
So.
look at how do I optimize fortoday?
How do I optimize for mybusiness?
Um, get local council involved.
So your normal, your normalbusiness council in your state
and go, you know, what's the,what's the advantages and
disadvantages?
I'll give an example.
An LLC, single member LLC inFlorida has no asset protection
(29:39):
value.
Single member LLC in Washingtondoes.
So if you're a Florida personand you're the only owner of an
LLC, you've You've got aproblem.
So you're, you know, you need toknow things like that.
And your local attorney is goingto know those things and help
you structure.
Um, but on balance, it's moreimportant to have a good, strong
business.
And these are the elementsaround the edges that will, you
(30:00):
know, kind of make it, make itbetter or worse.
But your local, your localattorney, you don't need to go
to, you know, uh, uh, and Ellisfor this, your local attorney,
your local business attorney isgoing to be able to navigate
these waters for you, um, untilyou move to the point where
you're going to be going througha transaction and then you're
likely to get some restructuringanyway.
squadcaster-9281_1_01-14- (30:19):
Yeah.
One bellwether you might lookfor is if you start seeing the
likes of Chase Bank or others,other, other of our largest,
conservative institutions startpulling tent stakes and going
somewhere else, it might be timeto really look into whether
Delaware remains a place, uh, atleast to be incorporated.
So
emily-sander_1_01-14-202 (30:37):
That's a good call.
Yeah.
So it sounds like at the end ofthe day, the takeaways here are,
this is nice to know about, it'sgood to know about, but focus on
the core of your business andmaking your business strong.
And then there's these kind ofsupplemental things that as you
get towards certain phases ofyour company or certain,
transaction events you want topay more focused attention to.
(30:59):
Um, and then Ed, you mentionedlocal attorney a couple of
times.
If someone's like, I'm like, Idon't know what that is or where
to find one.
Is there like a certain placeyou go by state?
Is there a certain name you callthese types of lawyers?
Just
squadcaster-a3hb_1_01-14-20 (31:10):
Um,
emily-sander_1_01-14-2025_16 (31:11):
to help people out.
squadcaster-a3hb_1_01-14- (31:12):
it's, it is one of those, it is one of
those things where if you, ifyou don't know a local attorney,
talk to your accountant.
If you don't have a localaccountant, talk to your
attorney.
If you don't have either one ofthem, then you should
emily-sander_1_01-14-2025_ (31:24):
Call Ed.
squadcaster-a3hb_1_01-14- (31:25):
Well, yeah, you can call me, but you
You should be looking for, um,folks who are similarly
situated, who, you know, youwould, who you would trust that
can make recommendations.
And then you interview them justlike you'd interview an
employee, get somebody whoyou're comfortable with, but you
need,
emily-sander_1_01-14-2025_ (31:41):
this like
squadcaster-a3hb_1_01-14-20 (31:41):
you need
emily-sander_1_01-14-2 (31:42):
friends, Rotary Club, like kind of your
local chamber of commerce typeof thing?
Or where do you go to?
squadcaster-a3hb_1_01-14 (31:47):
you're at in your, in your growth
emily-sander_1_01-14-2025 (31:49):
Okay.
squadcaster-a3hb_1_01-14-20 (31:49):
Um, but my, my normal approach is,
is business folks will tend toknow the names
squadcaster-9281_1_01-14-202 (31:55):
Oh yeah.
squadcaster-a3hb_1_01-14-20 (31:55):
the big law firms in town.
And it doesn't matter what townit is, or what state it is.
You'll tend to know the names ofthe big law firms in
squadcaster-9281_1_01-14-20 (32:03):
And the good lawyers within those
law firms.
Yeah.
squadcaster-a3hb_1_01-14-202 (32:05):
so that, that information tends to
be out there and, and attorneysand accountants, know, they're,
they're ones where you can, youcan definitely overspend on
attorneys and accountants.
And, and we love to, to takeyour money and help you.
Um, but what I would, what Iwould say is you're generally
going to be well served bysomebody who you've interviewed.
So I would interview some, I'dlook, you know, kind of look
(32:25):
around, um, you're going to belooking for business attorneys
and.
You're going to be looking forattorneys, ideally with some
transactions experience.
So a firm that's not just a, youknow, kind of, Joe on the corner
with a shingle and he doesparking tickets and he does, you
know, this, that, and the otherthing you, you want someone
who's, who's focused on businesstransactions and business
(32:48):
litigation.
And then on the accounting side,you want someone who's dealing
with more than just, you know,again, you don't want Chuck in a
truck, you know, kind of showsup, drives up to your place,
gets out with his laptop, doesit, does the work and, and
leaves without having the depthof experience.
Um, you know, who's been throughsome of these transactions,
either.
either in house or as a, as a,uh, advisor and you know, you're
(33:13):
going to, it's going to takesome interviewing to find the
right, the right professional.
squadcaster-9281_1_01-14- (33:16):
Yeah.
emily-sander_1_01-14-2025_1 (33:18):
All right.
Well, we can wrap it here.
And I guess it's just like, Oh,Delaware, what's going to happen
in, in Delaware, this go to, goto state for incorporating
businesses.
But, uh, I too learned a lot.
So thank you, Ed.
And thank you, Rory, forbringing this one to, to our
attention.
And, uh, we'll, we'll continueto do more trending topics and
(33:39):
keep everyone in the know aboutthese, these types of stories,
but Ed Rory, thanks as always.
squadcaster-a3hb_1_01-1 (33:44):
Thanks, Sam.
All right.
We are back with the privateequity experience podcast in
this, in this new, new year,2025 ed, Rory, how's it going?
squadcaster-a3hb_1_01-14- (00:44):
Busy, busy, busy.
squadcaster-9281_1_01-14- (00:45):
Feels just like 2024 so far, but, but
I guess
emily-sander_1_01-14-2025 (00:50):
We're with
squadcaster-9281_1_01-14-20 (00:50):
You know, 2024 was a good year.
I'd say overall.
So
emily-sander_1_01-14-2025_160 (00:54):
a good year.
We wrote a book and we startedthis podcast.
So it was a great
squadcaster-9281_1_01-14-2025 (00:57):
I mean, that blows my mind.
It all came together verynicely.
Yeah.
Proud of that, actually.
emily-sander_1_01-14-2025_1 (01:05):
for sure.
All right.
So we're going to break down oneof our trending topics today.
There was a story that hit thenews wires.
I'm going to try to like, Teethis thing up as, as best I can.
So context, Delaware has longbeen the go to state for
incorporating businesses for avariety of reasons, which we'll
outline.
(01:25):
There was a recent court casewith Elon Musk.
And, uh, I think it was like amassive compensation package
that was denied in some ways.
And this is now putting intoquestion, um, Is Delaware the go
to state in particular, like theVC and PE firms and lawyers who
would recommend, uh, kind ofwhere we'd have a tax footprint.
(01:48):
So that's kind of my like rough,rough grab at like what this
article was outlining, but maybewe can just start with like,
why, why is slash was Delawarethe go to
squadcaster-9281_1_01-14- (02:00):
well, first, let's just like note the
old life adage that the squeakywheel gets the grease and you
know, that the article youtalked about was all about Elon
billion comp package that gotdenied.
And I think that was the saberrattling that, sent
emily-sander_1_01-14-2025_1 (02:14):
Did you say billion or million?
squadcaster-9281_1_01-14-2025 (02:16):
a B.
squadcaster-a3hb_1_01-14-202 (02:17):
B.
squadcaster-9281_1_01-14- (02:18):
Yeah.
emily-sander_1_01-14-2025_ (02:19):
Holy cow.
Okay.
squadcaster-a3hb_1_01-14 (02:20):
stock, it was stock compensation.
squadcaster-9281_1_01-14- (02:22):
Yeah.
squadcaster-a3hb_1_01-14-202 (02:23):
So again, the
emily-sander_1_01-14-2025_1 (02:24):
Oh,
squadcaster-a3hb_1_01-14-20 (02:25):
for it to actually be worth what it
was worth.
squadcaster-9281_1_01-14 (02:27):
Right.
But
emily-sander_1_01-14-2025_16 (02:29):
So even for Elon Musk, that's okay.
So Elon
squadcaster-9281_1_01-14-2 (02:32):
gets all the media outlets and that
becomes the source of all this,you know, call it intellectual
discourse on the matter.
That's really been, you know,it's, it's been a discussion
point for many, many years.
You know, why Delaware?
What is it about Delaware thatmakes it, uh, You know, so
business friendly,
emily-sander_1_01-14-2025_ (02:50):
Musk has brought us to this place.
Thank you, Elon.
Um,
squadcaster-9281_1_01-14- (02:53):
know,
emily-sander_1_01-14-2025_ (02:57):
even for Elon Musk, 55 billion is
like real money.
So, okay, I get it.
Um, so why, so why,
squadcaster-a3hb_1_01-14-202 (03:04):
Go
emily-sander_1_01-14-2025_16 (03:04):
Is Delaware.
Yeah.
squadcaster-a3hb_1_01-14-20 (03:06):
me, let me preface this by saying
that Elon Musk brings us here,not necessarily because of, his
compensation
squadcaster-9281_1_01-14- (03:16):
Yeah.
squadcaster-a3hb_1_01-14-2 (03:16):
and, and But really, Delaware has
been really attractive forcompanies to incorporate in or
form their LLCs in for a coupleof different reasons.
The biggest one, and this isreally where the Elon Musk thing
kind of threw a spanner in theworks, is the Delaware, uh,
Chancery Court is, um, Beenhandling business basically back
(03:38):
about 150
squadcaster-9281_1_01-14- (03:40):
Yeah.
squadcaster-a3hb_1_01- (03:40):
Delaware made the determination, Hey,
look, we're going to be spot forbusiness.
They were the headquarters ofDuPont.
They had, they had a reallystrong kind of, kind of business
culture.
And they said, we're going tomake a.
Make our state the most friendlybusiness business friendly state
in the country used to be a lotof companies were incorporated
in New York Delaware becamepreferable and a lot of that
(04:02):
preference is due to the courtof Chancery, which is they had
such strong case law
squadcaster-9281_1_01-14- (04:09):
Yeah.
squadcaster-a3hb_1_01-14-20 (04:09):
was Both business friendly and was
setting a really strongprecedent that the cork chancery
tended not to overturn that whenyou incorporate it in Delaware,
you've got not only some taxbenefits because they don't have
business, uh, Business incometaxes.
They don't have business salestaxes.
They don't have, um, you know,they don't, they don't, they're
(04:32):
really relatively costeffective.
Um, especially if you don't dobusiness in Delaware.
If you do business in Delaware,you have business, uh, Delaware
squadcaster-9281_1_01-14- (04:39):
Yeah.
Yeah.
squadcaster-a3hb_1_01-14 (04:40):
don't, you don't pay Delaware income
tax.
There's, um, a lot of privacy.
issues in Delaware where theybasically go, look, we, we
don't, you don't have todisclose on all your filings and
it's not public publiclyavailable who the owners are,
who the officers are.
It's, it's kind of opaque.
And so as a result, the, and achancery court has built this
(05:01):
Big block of case law that wasconsidered to be kind of circus
sancte.
And
squadcaster-9281_1_01-14-2 (05:07):
Yep.
squadcaster-a3hb_1_01-14- (05:07):
could predict what was going to happen
if you did something inDelaware.
It's likely been done beforethat case law holds and for the
bulk of.
Business transactions state lawgoverns, not federal law.
So a lot of times you might findyourself in federal court
squadcaster-9281_1_01-14-2 (05:24):
not, but yeah,
squadcaster-a3hb_1_01-14-20 (05:25):
got kind of what they what they
called diversity of citizenshipwhere you've got citizens of
different different states andyou've got a, uh, a large enough
amount at dispute where it goesinto federal court.
But a lot of contracts arewritten to kind of force you
into, into Delaware state court.
Um, because the court ofchancery is, is so reliable.
(05:48):
The outcomes are so reliable.
And where the Elon Musk thingreally kind of threw Spanner in
the works.
And there's been a couple othercases as well.
And I'll talk about one that Iwas, I was part of, um, in my
prior life, um, is Dave.
Change some of the, they'reoverruling some of their old
cases or they're giving somekind of curve ball case law.
(06:08):
Um, recently in the last four orfive years, that is making
Delaware less predictable as faras what the courts are going to
do.
And the privacy, um, privacylaws in, you know, both
federally with the, with the,uh, The Corporate Transparency
Act, as well as, you know, atthe state level, are making it
(06:29):
more, you know, less attractivefrom a privacy perspective.
So while Delaware still has alot of advantages, um, some of
these recent court cases havecalled to question whether that
circus sanct set of case lawthat everybody relies on for
incorporation, for business, forbankruptcy, for all those
things, whether that's actuallygoing to continue to hold or
(06:50):
whether, you know, there's goingto be some, some new, uh,
precedent set and, and makesDelaware a lot less predictable
and therefore a lot lessattractive for, uh, investors
and, and incorporators.
Yeah.
squadcaster-9281_1_01- (07:02):
exactly.
And now when there's an openingon something like that, for the
reasons I just mentioned abouttransparency, then, you know,
you have other States that wantto have that kind of status to
where very business friendly,you got Texas, Wyoming, or.
Three that, you know, there'sbeen a lot discussed, but I'd
say that case precedent is soimportant here.
Um, and, that, that may be, youknow, a barrier, but I'd, I'd
(07:26):
say, you know, certainly you'rehearing less and less, or at
least, you know, I, you know.
Even in recent years, I've beenadvised less and less.
I automatically defaulted to anyentity on formula.
We're just going to form inDelaware.
It's like, well, well, why, youknow, like there's other states
that are just as friendly anddoesn't necessarily need to be
Delaware.
It's just become so ubiquitousthat, you know, folks always
(07:47):
default to that.
emily-sander_1_01-14-2025 (07:49):
Okay.
So Delaware was the like defaultgo to place, and they
intentionally tried to makethemselves attractive to
business.
And there is this like case lawwhich I'm taking as like just
like precedent for like, this isthis is how we do things in
Delaware, it sounded like likeother states might be, you know,
Didn't strict and stingy onthese things, but come to
(08:10):
Delaware and we'll take care ofyou.
We'll predictably, uh, uh, go inyour favor.
And then recently there's beenones where it's like, Whoa,
okay.
That usually doesn't come out ofDelaware.
And then can someone justbriefly break down?
Like, what was this Elon Musk?
Uh, 55.
8 billion thing.
Was it like, normally he wouldhave gotten paid out on that
(08:31):
under state law in Delaware.
And then he didn't, or what,what happened in that case?
squadcaster-a3hb_1_01-14-2 (08:35):
I'll give a general overview.
Um, so on the, on the Delaware,on the Delaware case,
essentially what Elon Musk didwas he took a, when he took over
Tesla, Tesla was a struggling,struggling company.
They weren't doing all thatwell.
Um, and he took as compensationequity.
So again, typical of a founder,typical of a early stage
(08:58):
investor, he took equity as thenext video.
As his compensation, um, in lieuof a bunch of cash comp, well,
what ended up happening was hedrove the value of that business
up so high that that equityturned into billion of
compensation and he was sued,not by the shareholders who
approved it.
(09:19):
Not by the board of directorswho approved it, but actually by
kind of independent folks whosaid, you know, this is an, this
is a ridiculous amount ofcompensation for what you've
done and therefore it's illegalunder Delaware law.
emily-sander_1_01-14-2025_1 (09:33):
But he made the company from
scratch.
It's more like what?
squadcaster-a3hb_1_01-14-20 (09:36):
the company from scratch.
He came in, the company wasfounded by others, but he came
in early stage when they werereally struggling and put them
on the path that they're ontoday.
emily-sander_1_01-14-2025_1 (09:45):
And some independent something
entity party in Delaware said,no, you don't, you don't get
that.
squadcaster-a3hb_1_01-14- (09:53):
Yeah, essentially, essentially
emily-sander_1_01-14-2025_ (09:54):
man.
squadcaster-a3hb_1_01-14-2 (09:55):
what happened, um, was there was a.
Compensation package that heagreed to in 2018.
So pre COVID, um, that wasequity based and it essentially
was driven by his ability to beable to add value into, into
Tesla.
(10:16):
And as a result of that.
you know, as a result of theperformance of Tesla since 2018,
the value of that turned intoover 56 billion, the equity, the
equity value.
And what, um, what ended uphappening was the court said
(10:39):
that was an egregious amount ofcompensation for you to receive.
Based upon the structure of the,the deal.
And therefore you wereovercompensated.
It was unfair and, and we shouldget that back.
emily-sander_1_01-14-2025 (10:55):
Okay.
I have lots of questions abouthow they came to that, but for,
for this, okay.
That decision was made.
squadcaster-9281_1_01-14-202 (10:59):
to see,
squadcaster-a3hb_1_01-1 (11:00):
people,
emily-sander_1_01-14-2025 (11:01):
Yeah.
Um, okay.
So, and then Rory, youmentioned, like, since this has
happened, some other states arepopping up on the radar being
like, Hey, like, what aboutTexas or Nevada or Wyoming?
I think it was, um, these arenow coming on people's radar are
like, why are those in therunning?
And like, are those viableplaces for people to look at?
squadcaster-9281_1_01-1 (11:22):
reasons that are, you know, generally
kind of the, the, the reasonscited by business friendly
environments for many reasons,you know, a low regulatory
environment.
You know, no corporate incometax.
That's probably the biggest one.
You know, when you, when you seeabout where corporations
domicile, that's the big one.
Um, another one that's nottalked about too much, but
(11:46):
probably talked about more inthe last.
To say, since 2008 and beforethat is, you know, director and
board member liabilityprotections against those
things.
those are, those are some of thekey reasons.
And those 3 states thatmentioned Texas, Wyoming, Nevada
are all friendly in that regard,as opposed to like saying.
(12:07):
You know, planning your flag inCalifornia or things like that,
you know, other that are on theother side of the equation.
So, um, those are, those are themain reasons, um, that get cited
for, for wanting, for beingbusiness friendly, generally
speaking.
emily-sander_1_01-14-2025_1 (12:21):
And when you mentioned like
domicile, and then, and I thinkyou referred to like, if, Okay.
If you are located, likephysically located in Delaware,
different things, um, occur, butwe're talking about, like, let's
say you're headquartered in, Idon't know, like, Florida or
like Washington State, becausewe're in Washington State, but
then your business isincorporated in Delaware.
(12:42):
That's kind of the setup we'retalking about.
squadcaster-9281_1_01-14 (12:44):
refers back to, like Ed said, to where,
where, you know, where domicileis, where that, where it's going
to be litigated or whether,where, what case law is, or
what, uh, what law is going tobe applied, state law.
Yeah.
In that regard.
squadcaster-a3hb_1_01-14-202 (12:59):
So the, so in general, like for
instance, if I was a, if I was acompany operating in Washington,
I could be incorporated inDelaware.
And so Delaware is my state ofcitizenship.
Cause again, for
squadcaster-9281_1_01-14- (13:11):
Yeah.
squadcaster-a3hb_1_01-14-202 (13:12):
of the law.
Companies are considered to beseparate.
squadcaster-9281_1_01-14-2 (13:17):
hmm.
squadcaster-a3hb_1_01-14-2025 (13:18):
I don't want to say individuals,
but they're separate legalentities.
Um, so they have their owncitizenship.
They have their own, you know,it's, it's kind of an
interesting, interesting legalfiction.
Um, but they then have toregister as a foreign
corporation in the state ofWashington.
So they essentially go, I'mincorporated in Delaware, but in
order to do business in thestate of Washington, they
(13:38):
register as a foreigncorporation in the state of
Washington.
They pay Washington.
you know, percentage of
squadcaster-9281_1_01-14-202 (13:44):
Mm hmm.
squadcaster-a3hb_1_01-14-20 (13:44):
pay
squadcaster-9281_1_01-14-20 (13:45):
You know.
squadcaster-a3hb_1_01-14-2 (13:45):
fee.
But to Rory's point, the, at theend of the day, they are
considered a citizen of thestate of Delaware for the
purpose of, for legal purposes.
And so while they may be drawnin the court in the state of
Washington, because of a tort,for instance, they, they, there
was a, an issue and they gotsued by a Washington state
resident and they get drawn intoWashington state courts.
(14:07):
If most of their contracts aregoing to be.
the state of Delaware andthey're going to use Delaware
law and potentially, potentiallyDelaware venue, which is kind of
where
squadcaster-9281_1_01-14 (14:18):
Right.
squadcaster-a3hb_1_01-14-202 (14:19):
to be, going to be, or where the
law, the case is going to beheard.
so it really brings that bigpile of Delaware, um, history
and precedent into, into playwhen I, when the cases are
settled.
Now I'm going to, I'm going toroll a lawyer kind of kind of
thing in here where you can be aWashington state company.
(14:41):
and be a Washington stateresident, then agree to Delaware
law and a Washington venue.
So I've, I've been part of alitigation that was in Oregon.
venue was in Oregon, the lawthat was being applied was
Delaware law
squadcaster-9281_1_01-14-2 (15:00):
Hmm.
emily-sander_1_01-14-2025_1 (15:01):
Oh.
squadcaster-a3hb_1_01-14-202 (15:01):
of Oregon between two Washington
residents.
emily-sander_1_01-14-2025_16 (15:05):
Do the lawyers in Oregon know that
law?
squadcaster-a3hb_1_01-14-20 (15:08):
Um, so interestingly, you've got the
law, the lawyers, generally onthe, on the commercial side.
So if you're doing commerciallitigation, a lot of them are
going to be familiar enough withDelaware law to be
squadcaster-9281_1_01-14- (15:20):
Yeah.
squadcaster-a3hb_1_01-14-20 (15:21):
And can always bring in Delaware
counsel.
The, the issue is going to bethe judge may not be familiar
with
emily-sander_1_01-14-2025_1 (15:28):
Oh.
I don't know.
squadcaster-a3hb_1_01-14-20 (15:29):
And if it's a federal case, the
federal courts, you know, aren'tgoing to, aren't going to say
it's Delaware law.
You're going to have federal lawis going to be, is going to
govern.
However, the, uh, You know, oneof the disadvantages of Delaware
is the Delaware lawyers knowthat Delaware is, so I had a, I
had a case, I mentioned thisearlier.
I had a case where we had acontract with an employee that
(15:52):
was under Delaware law, so wesued that employee in Delaware,
and that, that employee was aresident of the state of
Michigan, the company was aresident of the, was a, was a
Delaware company, The companywas headquartered in Florida.
And so we had to hire Delawarecouncil and the Delaware council
(16:13):
cost twice as much as New
emily-sander_1_01-14-2025_1 (16:15):
Oh, I see.
squadcaster-a3hb_1_01-1 (16:16):
they've
emily-sander_1_01-14-2025_ (16:16):
they know people need them.
squadcaster-a3hb_1_01-14-202 (16:18):
a, a, a corner
squadcaster-9281_1_01-14- (16:19):
Well, yeah.
Yeah.
squadcaster-a3hb_1_01- (16:20):
admitted to the bar in Delaware.
So they they've, you know, itcost us a small fortune.
And that was another one, um,where from a Delaware, from a
Delaware perspective, had newcase law pop up, um, on non
competes.
And that was,
squadcaster-9281_1_01- (16:36):
remember that.
I remember that popping up.
Yeah.
squadcaster-a3hb_1_01-14-2025 (16:39):
a Delaware non compete and there
was a recent, there was a coupleof recent rulings.
The one that we got hit withwas, uh, Intertech versus
Eastman, where they basicallysaid, you know, you, you, we're
not going to enforce.
Um, and then there's anotherone, century and service group
where they, the, the court said,we're not going to enforce the
non compete now, non competeshave been enforceable in
(17:01):
Delaware for a hundred years.
And so this, this kind of threwa spanner in the works for us.
And in addition, the.
Delaware court was extremelydeferential to what was a pro se
So essentially our employeerepresented himself, even though
he really didn't representhimself, but he didn't, he had,
he had a Michigan attorneyhelping him on the side and then
(17:23):
he walked in without theMichigan attorney into Delaware
court.
emily-sander_1_01-14-2025_ (17:27):
That doesn't sound like a smart thing
to do.
squadcaster-a3hb_1_01-14-20 (17:29):
And judges and
squadcaster-9281_1_01-14 (17:30):
That's amazing.
Pro se with an asterisk.
Yeah.
Yeah.
Yeah.
Oh, I was
squadcaster-a3hb_1_01-14- (17:33):
yeah, very sympathetic to pro se folks
who have their crap together.
Um, and so we ended up basicallyhaving to settle for a fraction
of what we should have, uh,settled for because the, the
Delaware courts had essentiallychanged the From the time we
entered into that agreement,know, four years prior to the
time we litigated it, couple ofcases, these couple of cases had
(17:55):
come through and basicallythrown out non compete law in
the state of Delaware, except invery narrow circumstances.
And it's, you know, that's,that's an issue.
emily-sander_1_01-14-2025_16 (18:03):
So with these sweep like changes,
do they have just a flood of newcases being brought to them?
Because they'll be like, Oh,actually, if you're not going to
do that, then I have a case.
If you're not going to enforcethat.
squadcaster-a3hb_1_01- (18:13):
Delaware always has a lot of cases and
what's, what's
squadcaster-9281_1_01-14- (18:16):
going to think it was maybe a little
bit different in so far as Youknow, because of all the case
precedent, you know, outcomeswould be more predictable.
So people would be less, uh,inclined to, you know, burn
money on litigation.
Whereas now I'm thinking Texas,Nevada, Wyoming, open their
doors, more business corporate.
They're the only people lickingtheir chops are the lawyers
because they don't have the caseprecedent.
You're relitigating basicallythat comes up in material ways.
(18:39):
Is that, I mean, how, how doesthat thought process, is that
logical?
squadcaster-a3hb_1_01-14-20 (18:42):
in.
No, and in Delaware, what folkshave tended to identify, they've
identified that there's been asubtle and some now not so
subtle shift in the courts.
And so you're seeing morelitigation to try and get
various business friendlypositions overturned.
Additionally,
squadcaster-9281_1 (19:00):
interesting.
squadcaster-a3hb_1_01-14-2 (19:02):
You, you've got attorneys now on the
business side who are, andagain, we kind of went through
this in our, in ours as well,
squadcaster-9281_1_01-14- (19:09):
Yeah.
squadcaster-a3hb_1_01-14-20 (19:09):
you know, we're not going to
litigate it, not because wedon't know what the outcome is,
but because we don't know whatthe outcome is.
And we don't necessarily likeour attorneys were like, look,
we don't want to put badprecedent on the books.
emily-sander_1_01-14-2025_1 (19:22):
Oh.
squadcaster-a3hb_1_01-14- (19:22):
know, it's better for us to settle
this because they could continueto continue to move the
goalposts on us and move it towhere it's worse for everybody
else.
Um, and so, You know, there'sright now, there's a little bit
of a, the, the one side isgoing, okay, how far is this
going to move?
How far can the goalposts move?
And the other side is going, canwe settle some of this stuff so
that we don't get additionalprecedence on the books that are
(19:44):
moving the goalposts furthertoward, um, non business
friendly positions.
emily-sander_1_01-14-2025_16 (19:50):
So
squadcaster-9281_1_01-14- (19:51):
Yeah.
Hmm.
emily-sander_1_01-14-2025_ (19:51):
does this all mean for VC and PE
firms and portfolio companies?
squadcaster-a3hb_1_01-14-202 (19:57):
As a, as a practical matter, I
think they're going to continuein the short run.
I think they're going tocontinue to use Delaware as a,
as a, Incorporation location ofchoice, um, because for all the
reasons we identified, um, I dothink what I, what I'm seeing,
um, in dealing with some of thefolks is Nevada has become kind
of a, uh, a number 2 choice,particularly here on the West
(20:19):
Coast as a, as a incorporationlocation.
Um, I.
have had a couple of my clientswhere I've recommended that they
actually built make their LLCsin Wyoming.
Um, Wyoming's my favorite by, bya long shot.
Um, but the, but you know,Nevada, I think has become far
more, far more, uh, for a numberof reasons, including their,
(20:41):
including not only theircorporations, but their trust
law is, um, is very favorable aswell.
So for folks who are founders orwhere they're intending to hold
for estate planning purposes,intending to hold some of the
stock or interest in theirbusiness and a trust, um,
Delaware or Nevada allows for.
Even on an irrevocable trust,changes to be made by the
(21:02):
grantor, um, which, which is awhole different set of case law
that we could talk about with,with like the Fox News, Rupert
Murdoch and trying torestructure his trust and
allowing, and whether, you know,Nevada allowed him to
restructure his trust or not.
But that's, that's Nevada's kindof a, an up and
squadcaster-9281_1_01-14- (21:18):
Yeah.
squadcaster-a3hb_1_01-14-20 (21:19):
Um, the issue is none of these
states, Wyoming, Nevada, um, uh,to a lesser extent, Texas have
the body of case law that makesit as predictable.
So when you're going in thestate, you're going in a state
court in Sheridan, Wyoming,you're probably getting a little
bit different level of, ofengagement than you would when
you're going into a chancerycourt in Wilmington.
emily-sander_1_01-14-2025_1 (21:42):
Why is Wyoming your favorite?
squadcaster-a3hb_1_01-14-20 (21:44):
Um, from, from my seat, it's the,
you've got, uh, stronger privacylaws in Wyoming.
Their trust laws are solid.
Um, you've got, um, no stateincome tax, federal or no state
income tax for individuals, nostate income tax for business.
It's a low cost of, of, uh, LLCformation or corporation.
They've got a, and, and.
(22:05):
You know, for those of us hereon the west coast, it's
relatively
squadcaster-9281_1_01-14- (22:08):
Yeah.
squadcaster-a3hb_1_01-14-20 (22:09):
Um, so it's not, if you do have to
show up in court, you're notflying cross country.
Um, the downside to Wyoming isyou don't have a very strong, I
shouldn't say that.
You don't have a large bar.
So, you know, from an attorneyperspective or a CPA
perspective, there's not a tonof Wyoming attorneys and CPAs,
um, just'cause the state's sosmall from a population
(22:31):
perspective.
So you don't have the
squadcaster-9281_1_01-14- (22:33):
Yeah.
Yeah.
squadcaster-a3hb_1_01-14- (22:34):
level of support yet that you would
get out of a, you know, out of aDelaware, which draws on
Pennsylvania and, and Marylandand DC as well.
emily-sander_1_01-14-2025_16 (22:43):
So it sounds like.
If you become knowledgeableabout just like the general
landscape.
Of the tax implications for thisstate versus this state,
depending on what you're tryingto do.
If like you want to emphasis andlike, Hey, I do want to set up
trusts and I know that I'm goingto have generational wealth and
I want to make sure that's setup well for my family.
You might go to Nevada if you'relike, Hey, privacy law is
(23:06):
important or all these otherthings that are happening in
Wyoming, you might make astrategic decision to like, look
into those types of states.
Is that, uh,
squadcaster-a3hb_1_01-14-20 (23:14):
and you might have a choose your own
adventure piece where you'vegot, where you've got the
companies incorporated in, in.
but the stock is owned by aNevada trust or a Wyoming LLC
and because there's noprohibition for that.
So you can take the best ofeverything on your ownership
structure for state planningpurposes or asset protection
(23:36):
purposes.
You know, but again, Nevada,Nevada for trusts is probably
the most advantageous trust lawin the country.
Um, I think Wyoming on the LLCside is becoming kind of the go
to place for LLCs.
And, but I still think if you'regoing to end up going public, if
you're going to end up,expecting litigation.
(23:56):
If you're going to be a largerorganization, if you've got
institutional investors, you'reprobably still looking at
Delaware, you know, as difficultas the last couple of years have
been with some of the chancerycourt decisions.
Um, it's still got a huge amountof case law.
It's still far more predictableand it's got the infrastructure,
the legal, the accounting, the,the, The business infrastructure
(24:17):
to be able to supportinstitutional investors where
you know, Nevada, Wyoming, or,or, and even Texas are still
well behind in that
squadcaster-9281_1_01-14- (24:25):
Yeah.
emily-sander_1_01-14-2025_1 (24:27):
are there certain states that are
not favorable to Business likeyou mentioned California, but is
there something where it's like,hey, you have the
squadcaster-9281_1_01-14-2025 (24:34):
I think it would rival
emily-sander_1_01-14-2025_ (24:34):
like a
squadcaster-9281_1_01-14- (24:35):
them.
emily-sander_1_01-14-2025_ (24:35):
like a Like a P.
E.
backed, kind of like, you don't,like, you want to stay away from
this one just for certain typesof tax law.
squadcaster-a3hb_1_01-14-2025 (24:42):
I mean, I would, I would
generally, I would generallysay, um, if you are a local
company doing local business andare located and doing business
and predominantly in that state,you're probably, probably a
little disadvantage to in thatstate because you have, you have
(25:04):
to file as a foreign corporationanyway, if you're incorporated
in Delaware, you're still goingto be
emily-sander_1_01-14-2025 (25:08):
Yeah.
squadcaster-a3hb_1_01-14 (25:08):
there, et cetera.
If you're a multi, if you're amultinational or multi multi
state, then yes, there are oneswhere I would be like, you know,
I, as an, as an accountant or anattorney, I would advise you
might not be a good choice.
California kind of being at the
squadcaster-9281_1_01-14- (25:22):
Yeah.
squadcaster-a3hb_1_01-14- (25:23):
list, Illinois, New York,
Massachusetts, um, those aregoing to be kind of at the top
of the list of, you know, think,think again, whether that's
actually your best choice.
Um, and then, know, there's,there's on the flip side, um,
you know, if you'repredominantly doing business in
(25:43):
those states and you'resubjected to those laws and
those taxes anyway, to beincorporated in that state
actually will Potentially reduceyour costs because you won't
have additional filing fees forbeing incorporated there.
And if you're hauled into court,
squadcaster-9281_1_01-14- (25:57):
Yeah.
squadcaster-a3hb_1_01-14- (25:57):
going to have to hire Delaware council
to go represent you and fly downto Wilmington to go into
chancery court where you couldgo down the street and, you
know, be, and be in court in,you know, in the state, in the,
in your own local backseat orbackdoor venue.
squadcaster-9281_1_01- (26:11):
Probably depends a lot on the type of
business too.
You know, certain, I mean, nowwe're going beyond just, uh, You
talk about, you know, um, waysin which states lure businesses
with, uh, credits and, you know,other incentives and things like
that, you know, depending on thetype of business that you have,
whether it's, you know, energyor, uh, you know, technology or,
(26:34):
uh, or manufacturing that could,that could be different by state
too, depending on what theoffering to businesses like that
to, You know, be set up thereand so forth.
emily-sander_1_01-14-2025_16 (26:48):
So what does this mean for future
outlook?
For, like, what should people bepaying attention to?
We're kind of at this, like,well, this seems to be changing.
Delaware had a strong precedentfor a hundred years in these
areas, and now it might bechanging.
What should people be lookingout for?
And what, what do you think thefuture outlook is?
Is this like a watershed momentwhere like now these other
(27:09):
states are going to buildthemselves up to be the next
Delaware or, or whatever?
squadcaster-9281_1_01-14- (27:14):
Yeah, I don't know that I'd call this
watershed per se.
I think, you know, I think thisis something that's been
discussed more, but I think, um,you know, there have been
certain headlines that havebrought this to the floor a
little bit more.
But I think as far as what towatch out for is, I think it's,
it's as much about.
Minimizing risk is maximizingopportunities is some of these
(27:37):
states that step up to the plateto offer more incentives to, you
know, make it more friendly tocompanies to get set up, things
like that.
That could be more of anopportunity.
And, you know, you're talkingabout a business that Uh, it's
growing large in scale, youknow, even small margins on big
numbers make a big differencefor, for businesses and cost and
(27:58):
risk management and things likethat.
So I think this is just onewhere, you know, it's
interesting to kind of keepapprised, but it's also, you
know, if you're, if you'rerunning a business, Uh, if
you're a founder, uh, if you'resomeone that's, um, looking to
think about restructuring yourcompany in certain ways, this is
definitely something to beconnected with your, your
(28:19):
counsel on, you know, they'rethe ones that are, apprised more
than anything, as you see, evenon this call, Ed knows what's
up.
I'm learning a lot from Ed here,right on this call, you know, so
attorneys, attorneys stay on topof this stuff necessarily for
sure.
squadcaster-a3hb_1_01-14- (28:33):
Yeah, I would, I would say, um, I
would agree with Rory, notwatershed, but, um, the
landscape is, is changing alittle bit and for larger
organizations and institutionalinvestors, it's, I don't think
you're going to see a dramaticshift.
I think there's still a comfortlevel with, with Delaware, um,
that unless the, the court ofchancery gets kind of out of
(28:55):
control, I think it's going tobe, I think it's going to be
fine.
Um, for individual founders, um,thought process, a lot of them
incorporate or build their LLCin Delaware because they're
looking for, well, someday I'mgoing to get institutional money
and what have you.
As we've talked about in acouple other, uh, pods, the, you
(29:16):
know, they're likely to put ablocker C and they're likely to
put some other structuring inplace when they buy.
So.
look at how do I optimize fortoday?
How do I optimize for mybusiness?
Um, get local council involved.
So your normal, your normalbusiness council in your state
and go, you know, what's the,what's the advantages and
disadvantages?
I'll give an example.
An LLC, single member LLC inFlorida has no asset protection
(29:39):
value.
Single member LLC in Washingtondoes.
So if you're a Florida personand you're the only owner of an
LLC, you've You've got aproblem.
So you're, you know, you need toknow things like that.
And your local attorney is goingto know those things and help
you structure.
Um, but on balance, it's moreimportant to have a good, strong
business.
And these are the elementsaround the edges that will, you
(30:00):
know, kind of make it, make itbetter or worse.
But your local, your localattorney, you don't need to go
to, you know, uh, uh, and Ellisfor this, your local attorney,
your local business attorney isgoing to be able to navigate
these waters for you, um, untilyou move to the point where
you're going to be going througha transaction and then you're
likely to get some restructuringanyway.
squadcaster-9281_1_01-14- (30:19):
Yeah.
One bellwether you might lookfor is if you start seeing the
likes of Chase Bank or others,other, other of our largest,
conservative institutions startpulling tent stakes and going
somewhere else, it might be timeto really look into whether
Delaware remains a place, uh, atleast to be incorporated.
So
emily-sander_1_01-14-202 (30:37):
That's a good call.
Yeah.
So it sounds like at the end ofthe day, the takeaways here are,
this is nice to know about, it'sgood to know about, but focus on
the core of your business andmaking your business strong.
And then there's these kind ofsupplemental things that as you
get towards certain phases ofyour company or certain,
transaction events you want topay more focused attention to.
(30:59):
Um, and then Ed, you mentionedlocal attorney a couple of
times.
If someone's like, I'm like, Idon't know what that is or where
to find one.
Is there like a certain placeyou go by state?
Is there a certain name you callthese types of lawyers?
Just
squadcaster-a3hb_1_01-14-20 (31:10):
Um,
emily-sander_1_01-14-2025_16 (31:11):
to help people out.
squadcaster-a3hb_1_01-14- (31:12):
it's, it is one of those, it is one of
those things where if you, ifyou don't know a local attorney,
talk to your accountant.
If you don't have a localaccountant, talk to your
attorney.
If you don't have either one ofthem, then you should
emily-sander_1_01-14-2025_ (31:24):
Call Ed.
squadcaster-a3hb_1_01-14- (31:25):
Well, yeah, you can call me, but you
You should be looking for, um,folks who are similarly
situated, who, you know, youwould, who you would trust that
can make recommendations.
And then you interview them justlike you'd interview an
employee, get somebody whoyou're comfortable with, but you
need,
emily-sander_1_01-14-2025_ (31:41):
this like
squadcaster-a3hb_1_01-14-20 (31:41):
you need
emily-sander_1_01-14-2 (31:42):
friends, Rotary Club, like kind of your
local chamber of commerce typeof thing?
Or where do you go to?
squadcaster-a3hb_1_01-14 (31:47):
you're at in your, in your growth
emily-sander_1_01-14-2025 (31:49):
Okay.
squadcaster-a3hb_1_01-14-20 (31:49):
Um, but my, my normal approach is,
is business folks will tend toknow the names
squadcaster-9281_1_01-14-202 (31:55):
Oh yeah.
squadcaster-a3hb_1_01-14-20 (31:55):
the big law firms in town.
And it doesn't matter what townit is, or what state it is.
You'll tend to know the names ofthe big law firms in
squadcaster-9281_1_01-14-20 (32:03):
And the good lawyers within those
law firms.
Yeah.
squadcaster-a3hb_1_01-14-202 (32:05):
so that, that information tends to
be out there and, and attorneysand accountants, know, they're,
they're ones where you can, youcan definitely overspend on
attorneys and accountants.
And, and we love to, to takeyour money and help you.
Um, but what I would, what Iwould say is you're generally
going to be well served bysomebody who you've interviewed.
So I would interview some, I'dlook, you know, kind of look
(32:25):
around, um, you're going to belooking for business attorneys
and.
You're going to be looking forattorneys, ideally with some
transactions experience.
So a firm that's not just a, youknow, kind of, Joe on the corner
with a shingle and he doesparking tickets and he does, you
know, this, that, and the otherthing you, you want someone
who's, who's focused on businesstransactions and business
(32:48):
litigation.
And then on the accounting side,you want someone who's dealing
with more than just, you know,again, you don't want Chuck in a
truck, you know, kind of showsup, drives up to your place,
gets out with his laptop, doesit, does the work and, and
leaves without having the depthof experience.
Um, you know, who's been throughsome of these transactions,
either.
either in house or as a, as a,uh, advisor and you know, you're
(33:13):
going to, it's going to takesome interviewing to find the
right, the right professional.
squadcaster-9281_1_01-14- (33:16):
Yeah.
emily-sander_1_01-14-2025_1 (33:18):
All right.
Well, we can wrap it here.
And I guess it's just like, Oh,Delaware, what's going to happen
in, in Delaware, this go to, goto state for incorporating
businesses.
But, uh, I too learned a lot.
So thank you, Ed.
And thank you, Rory, forbringing this one to, to our
attention.
And, uh, we'll, we'll continueto do more trending topics and
(33:39):
keep everyone in the know aboutthese, these types of stories,
but Ed Rory, thanks as always.
squadcaster-a3hb_1_01-1 (33:44):
Thanks, Sam.
Popular Podcasts
NFL Daily with Gregg Rosenthal
Gregg Rosenthal and a rotating crew of elite NFL Media co-hosts, including Patrick Claybon, Colleen Wolfe, Steve Wyche, Nick Shook and Jourdan Rodrigue of The Athletic get you caught up daily on all the NFL news and analysis you need to be smarter and funnier than your friends.
On Purpose with Jay Shetty
I’m Jay Shetty host of On Purpose the worlds #1 Mental Health podcast and I’m so grateful you found us. I started this podcast 5 years ago to invite you into conversations and workshops that are designed to help make you happier, healthier and more healed. I believe that when you (yes you) feel seen, heard and understood you’re able to deal with relationship struggles, work challenges and life’s ups and downs with more ease and grace. I interview experts, celebrities, thought leaders and athletes so that we can grow our mindset, build better habits and uncover a side of them we’ve never seen before. New episodes every Monday and Friday. Your support means the world to me and I don’t take it for granted — click the follow button and leave a review to help us spread the love with On Purpose. I can’t wait for you to listen to your first or 500th episode!
Dateline NBC
Current and classic episodes, featuring compelling true-crime mysteries, powerful documentaries and in-depth investigations. Follow now to get the latest episodes of Dateline NBC completely free, or subscribe to Dateline Premium for ad-free listening and exclusive bonus content: DatelinePremium.com