Articles

Following a Delaware flip, founders need to consider how the new U.S. parent company will use equity to attract and retain talent across borders. That means choosing a plan structure that supports the company’s hiring ambitions while accommodating the different tax and legal requirements applicable to its workforce. This article explores the available approaches, from adopting a U.S.-style plan with UK arrangements to retaining a UK-focused scheme, and explains the principal types of U.S. stock options.

An option over UK company shares does not automatically become an option over TopCo shares when the shareholders exchange their shares. Depending on the plan terms, tax objectives and transaction mechanics, options may be assumed or exchanged by TopCo, exercised before the flip, cashed out or canceled and regranted.

For non-U.S. founders looking to raise capital from U.S. venture funds, one piece of advice comes up repeatedly: If you want U.S. venture capital, be prepared to restructure as a Delaware C corporation. The preference for Delaware is real, but it is not simply because venture capitalists or their lawyers like Delaware.

U.S. expansion is not simply about forming a new entity. It’s about building a structure that supports the company’s next stage of growth. Before rushing into a Delaware flip or forming a U.S. entity, consider the most common paths founders take—and the trade-offs each involves.

While much attention is paid to the mechanics of the Delaware flip itself, founders should also consider the longer-term implications of operating a multinational group structure.

For companies considering a jurisdictional move, here are some of the required steps, considerations and typical documentation that accompany such a move.

The rise of business courts reflects growing competition between states to offer efficient forums that meet the needs of businesses to attract new businesses to their state and away from Delaware.

If you're launching a startup in 2025, one of your first questions might be: “Where should I incorporate?” For decades, the most popular answer has been Delaware, but Texas is emerging as a serious contender for Delaware’s crown. Which should you choose?

Whether you started thinking about incorporating earlier this morning or you’re a serial founder about to launch your fifth unicorn, the Delaware incorporation might seem like an odd phenomenon.