2024

Gust

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The Misleading Attractiveness of S Corp Elections

Gust

Investors prefer investing in Delaware C Corps which don’t allow founders to take personal tax losses for early expenses. Many founders are tempted to make an S-Corp election which allows a pass-through tax treatment similar to an LLC. While that could be a small short term gain in the early days, it can jeopardize a much larger tax free gain in the future ($10M+).

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Don’t Panic! Your pre-revenue startup doesn’t owe $85,165 in Delaware Franchise Taxes

Gust

It’s Delaware Franchise Tax Season! If you’re incorporated in Delaware and you’re staring at a terrifying notice with the number $85,165.00 on it, don’t panic. It’s very likely that your startup only owes $400. Read on for details on how to refigure your bill, easily file your report, and reduce your stress in future years. The post Don’t Panic! Your pre-revenue startup doesn’t owe $85,165 in Delaware Franchise Taxes appeared first on Gust.

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Startup Strategies: The Strategic and Financial Significance of Intellectual Property

Gust

Startups are often at the forefront of innovation, developing new technologies, products, and services that disrupt traditional industries and bring fresh ideas and approaches that drive technological advancements. In that regard, startups often rely heavily on their ideas, and the unauthorized replication of those ideas may result in a loss of control over the unique aspects of a startup’s offerings.

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Using Copyrighted Works in AI Training Data May Infringe Even if the AI Output Doesn’t

Gust

Thomson Reuters Enterprise Centre GmbH v. Ross Intelligence Inc., decided in the federal District Court in Delaware on September 25, 2023, asks the question whether a company can train its AI on a competitor’s copyrighted works in order to help it compete? What if the AI output does not infringe the competitor’s copyrights? The answer so far is “maybe,” but that the answer is not “no” adds to the hazards of using copyrighted works as training data.

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Understand the Funding Process and What Investors Want to See

Gust

Some very small businesses—particularly those that offer the professional or personal services of a single individual—can be launched and grown with few or no resources other than human time and talent. But most businesses require some money before they can be started—to pay for software, buy tools or equipment, lease office space, or pay for the time worked by employees or outside contractors.

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