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Or outside Occupiers....

Simplifies things considerably.

You don't need a "Manager" per se.

But you still have family "Occupiers" and "Investors" plus a "Trustee", where you may bring in someone you trust (even a solicitor - if they would do it) in case people go under buses etc.

Individuals eg Mummy and Daddy, could be Members of all three stakeholder "groups" while other family members may only be Investors (especially when Junior leaves home, or when Mummy and Daddy get divorced).

So who needs a "pre-nup", or even a will?

You can extend this "family corporation" to acquire a property in which Junior lives etc etc

In the LLP ownership and control do not go together as in Companies.

I think it will be particularly interesting to family businesses who always have the problem of passing the family biz down through generations while retaining control.

Or of bringing in competent managers and keeping their interests aligned with those of the family.

Or of letting outsiders invest so that some family members can "cash out" yada yada

An LLP is limited only by one's imagination.


"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Mon Mar 26th, 2007 at 12:39:59 PM EST
[ Parent ]
a straight corporate setup with shares etc.  LLC just simplifies the paperwork perhaps.  

There are plenty of corporations with 2 classes of shares -- some voting, some non voting.  Ford Motor is the biggest example I can think of.  The Fords only own about 10% of the company, but have a much greater piece of the voting stock.

Not dissing LLCs as much as failing to see the big advantage in re-labeling.

by HiD on Mon Mar 26th, 2007 at 09:49:47 PM EST
[ Parent ]
I really think you are comparing chalk and cheese.

All Ford is doing is splitting ownership between two classes of financial investors. The company is otherwise structurally no different from any other as between the relationship between owners and everyone else aka "costs".

The difference is that the "Capital Partnership" variant of LLC's and LLP's brings the investors and users of investment on the same side.

The "Principal/Agency" problem of "the Corporation" - which requires the whole panoply of Company Law, Sarbox and all the rest - simply does not exist in this model.

If you need any evidence of the attractiveness of such a structure to investors you only need to look at the phenomenal growth in Canadian Income Trusts, which now extend to virtually the entire Canadian capital market.

This occurred despite the tax issues, management issues (an entrepreneurial trust is an oxymoron) and the complexity and costs of trusts (which is why accountants and lawyers love them).

Investors demonstrably like to share the Gross revenues with the  management.

Would you rather drink the water before it goes into the bath, or after it comes out of the plug-hole?

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Tue Mar 27th, 2007 at 03:59:31 AM EST
[ Parent ]

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