[bumby]

I think my issue with your hypothetical is that is assumed a company is already viable and in business. One of the primary advantages of a corporation or LLC is it’s limited liability. I.e., you can take a risk and if things don’t work out you can still personally recover. I suspect if we took the approach of your post, many, many fewer people would try their hand at starting a business because there are no limits to liability and much less capital to fund businesses if shareholders downside wasn’t capped.