Assignment

Choose the Right Type of Business Entity for Your Venture

Context:

By now you know the different types of legal entities for a business. You must have analyzed the pros and cons
of different business entities. Now, it’s time for you to choose a business entity for your venture.
Objective of this assignment is:
1. Choose the right type of business entity for your venture.

Instructions:
A 1. Regroup in your practice venture teams.
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2. Go through the tips on choosing the right type of business entity for your venture given below.
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ce 3. Fill in the table given on the next page. Complete the assignment in 1 hour.
d 4. Check with your facilitator how and when to submit the assignment.
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se Tips to Choose the Right Type of Business Entity for Your Venture
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En 1. Go through the Student Handout on Different Legal Entities and the Compliance Checklist. Analyze
tr the pros and cons of the different legal entities in terms of the ownership, ease and cost of setting up,
ep nature of liability, ongoing regulations and compliance, and fundraising and scalability. In case you
re decide to register your venture as any other structure (i.e. other than Sole Proprietorship, Partnership,
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LLP, Private Limited Company, or One Person Company), seek the expert guidance on the kind of
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structure-specific compliances required.

2. Go through the List of Required Registrations. Please note that this list would be different for different
countries.

3. Brainstorm with your team and choose a business entity for your venture.

Legal Matters Page 1 of 2

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 Type of entity chosen Reason for choosing the business entity

Private Limited company Because ours is a startup & it is preferable for us to

choose private limited company as the business entity the
reason being stability and growth opportunities offered by
this structure. Further, it assures separate legal existence
from its members. So, it can involve into contracts and
legal proceedings in its own name. Moreover, a
A company’s status is unaffected from any change in
dv members and management.
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