Ask HN: When’s the Right Time to Incorporate?

[iamnnk]

Is it necessary to incorporate if someone’s a solo founder and doesn’t have investors? Can the revenue coming into the ‘company’ be accepted into a separate account created by the founder in their own name? How will investors in a future round judge this?

[DamonHD]

That will be partly a tax decision, ie are your local tax authorities going to regard the separation of you vs business as clean enough. In the UK you could operate as a sole trader and maintain records well enough for that.

Your investors will likely want something that they can own a definite part of, and that is likely to be an incorporated entity. Again, as long as you can clearly enough assign the value (eg IPR) to that soon enough, everyone should be happy IMHO.