LLC in California

California nicknamed the “Golden State” is home to some of the big companies of the world including JBL, Mozilla Corporation, Netflix, Warner Bros., Wells Fargo, Universal Pictures, Tesla, Inc., Seagate Technology, and San Jose Sharks LLC among others. You can also start an LLC in California and leverage the dynamic capabilities and innovation platforms in a rapidly evolving California business environment. Due to the fact that a limited liability company is a pass-through entity, they are the most popular legal entity in the state of California. Once you form an LLC in California, you will need to keep it active by filing California LLC statements of information and annual tax.

What is California LLC?

You can form a domestic or a foreign limited liability in California. You can also form a California LLC in any other state and move your business to California. The process for the registration of a domestic LLC is different from that of a foreign LLC. There are several different types of LLC that can be formed in the US and they are:

• Single-Member LLC/Sole Proprietorship
• General Partnership
• Family Limited Partnerships
• Series LLC
• Restricted LLCs
• L3C Company
• Anonymous LLC
• Member-Managed LLC or Manager-Managed LLC

What are the benefits of forming an LLC in California?

Boasting a $3.2 trillion gross state product (GSP), California is the 5th largest economy in the world. This growing economy can be attributed to the 4 million small businesses along with the big names in the IT sector. You can also form a California LLC in such a thriving economy but that is not the only benefit the state offers. There are several other benefits of starting an LLC in California like the following:

• Pass-Through Taxation: One of the primary reasons entrepreneurs start an LLC in California as opposed to other business structures is pass through taxation. Pass-through is a type of tax treatment where-in taxes of the LLC literally “flows through or passes through” to the tax returns of the LLC owner or members. Hence, when you register a California LLC, it will not be subjected to any double taxation like some other business structures may be subjected to. It is also important to note that when a limited liability company elects to be taxed as a corporation then pass through taxation will not be applicable.
• Limited Liability Protection: California LLC incorporation will provide you with limited liability protection. This simply means that as the owner you will not be held responsible if the company suffers a loss. This also means that all your personal assets like home, car, and bank accounts will have necessary protection from lawsuits and business debts.
• Credibility: If you register a California LLC then the company will help increase credibility in the market. In fact, a limited liability company is recognized as a formal business structure as compared to partnership or sole proprietorship.

Forming an LLC in California

California provides strong business infrastructure and a robust platform for startups and hence is considered a favorite location for starting a new business. You can form a limited liability with the help of a top California LLC registered agent like IncParadise although there is a process that you will be required to follow. The process has several steps right from the conception of a company name to actually filing the articles with the office of the California Secretary of State.

1. Choose California LLC name

Every business is known and defined by its name and hence choosing an appropriate name is crucial towards business operations. The business name is provided in most of the official documents including application for EIN tax ID, California LLC statement of information, and Articles of Organization. When you are ideating a name, it is important to follow the name regulations mentioned in the 2021 Revised Business Entity Name Statutes and the California Revised Uniform Limited Liability Company Act.

2. Choose California LLC registered agent

One of the important steps towards California LLC incorporation is finding, hiring, and maintaining a registered agent. Most first time business owners would ask if hiring a registered agent is necessary or not. Apart from the fact that having a California LLC registered agent can be quite beneficial, it is also mandatory for all corporations, LLCs and other business entities to appoint and maintain a registered agent pursuant to the California Corporation Code Section § 1700-1702.

IncParadise offers a wide variety of registered agent services in California!

3. File Articles of Organization with CA SOS

In order to form a California LLC, you will be required to file the “Articles of Organization” with the California Secretary of State pursuant to CA Corp Code § 17702.01 (2017). You will have to provide specific information in the articles pertaining to the business including LLC name in compliance with Section 17701.08, office street address, and name and street address of your California LLC registered agent among others. The filing fee for Articles of Organization is $70. If you submit in person then there is a counter drop-off fee of $15.

Register a California LLC Today!

4. Prepare LLC operating agreement

An LLC Operating Agreement is an integral aspect of forming a limited liability company in California. It is a legal document, which outlines the duties of members and owners of the company. It is not possible to start an LLC in California without the operating document although you are not required to submit it with the office of the Secretary of State. The importance of the agreement lies in the fact that it helps in setting down the working and financial relationship among members or business owners as well as between managers and members. The content of an LLC operating agreement will vary from one entity to another but the six key areas included in this are:

• Organization
• Management and Voting
• Capital Contributions
• Distributions
• Membership Changes
• Dissolution

5. Obtain EIN

EIN is an Employer Identification Number and it is also known as the Federal Employer Identification Number. This is a unique 9 digit tax ID number that is assigned to businesses by the Internal Revenue Service (IRS). It is used for reporting employment taxes and most businesses in California would require this number bar a few exceptions. If you register a California LLC with one member (single member LLC) and are considered a disregarded entity without any employees then you will not be required to apply for an EIN. If your company is a multi-member LLC then you will be required to apply for and obtain an EIN.

We can help you get your EIN number in California!

6. File initial statement of information

Once you have filed the Articles of Organization for California LLC incorporation, there is another filing required by every LLC in the state. It is known as the Statement of Information (Form-LLC_12) and has to be filed with the California Secretary of State, within 90 days from the date of registration of the limited liability company. After the initial filing, the statement of information has to be filed once every two years. If your LLC has more than one member or manager then you will be required to also file an “Attachment to Statement of Information” during the initial statement filing. The initial statement filing fee is $20. As one of the top California LLC registered agents, IncParadise can assist you with the filing of the statement of information.

7. Pay California annual franchise tax

If you register a California LLC then there are certain annual requirements you will be required to fulfill including filing annual franchise tax. A limited liability company organized in California or conducting business in the state has to file an annual tax of $800. The tax is due on the 15th day of the 4th month from the day of registration of the LLC e.g., if you formed LLC on June 22, 2021 then your tax will be due on September 15, 2021.

8. Obtain necessary business licenses and permits

Once you register a California LLC, it will become operational only after you apply for and obtain necessary business licenses and permits. You can start your business in a variety of industries but the type of business license and permit will depend entirely on the business activity. In California, business licenses or permits can be classified under two categories, which are:

• General business license
• Business licenses or permits for specific industries

9. Open a bank account

One of the important requirements pre or post California LLC incorporation is that of a bank account. Whether it is a single member LLC operating as a sole proprietorship or a multi-member LLC, having a business bank account always reduces any problems that may arise due to the mixing of your personal and business finances. Having a separate business account will also help in tracking your business cash flow while helping manage business specific budgets along with income and expenditure.

10. Comply with taxes and other regulations

Most businesses established in California will have to pay some form of tax. If you register a California LLC then depending on the business activity and the type of LLC, you may be required to file one or more forms of state tax. According to the California Franchise Tax Board (FTB), an LLC classified as a partnership for tax purposes will have to file Form-568 for Limited Liability Company Return of Income. Some of the different forms of taxes that a California LLC may have to file include:

• If you start an LLC in California as a retailer or are in the retail business where selling of goods and merchandise takes place then you will be required to file sales tax. You will have to first register with the California Department of Tax and Fee Administration (CDTFA) to pay this tax.
• If your company is a single-member LLC then you will be required to file self-employment tax on your business profits
• Owners of a California LLC will be required to pay federal income tax on profits earned less federal deductions or allowances
• As an employer, you will be required to file payroll tax on any salaries paid to an employee

Ready to form a California LLC?

If you are planning to form a California LLC or you have an innovative startup idea then the state provides just the right balance of opportunity and growth. We at IncParadise are one of the most reputed California LLC registered agents and have helped thousands of startups and new businesses to register and operate in the state. We can assist you with the entire process of LLC formation as well as annual maintenance of your company.

Home Based Business in California

There are 4 million small businesses in California and a majority of such businesses are startups from home. There are almost 15 million home-based businesses in the U.S and it is not surprising that 69 percent of startups have sprung from home-based business ideas.

Why start a home-based business in California?

If you are planning to start a home-based business in California then it is certainly a good decision as the state itself promises opportunities, infrastructure, and a robust platform for any form or type of business. The GDP of California is $3.09 trillion and much of it can be owed to the 4.1 million or more small businesses that are currently operational in the state. It has the second-highest number of small businesses in the nation and its economy has been growing at an annual rate of 3.5%, which is more than the U.S economy. If you are wondering how to start a home business in California then there is a process for the same but first it is important to understand what makes California one of the first choices for entrepreneurs and home based startups. There are several aspects that make California popular and this includes:

• Networking: One of the biggest benefits of a home-based startup is the availability of networking opportunities. When you start a home-based business in California, you can join any of the networking groups and participate in meetups, conferences, and events. The important aspect of becoming a part of such groups is that you will be able to meet and communicate your business ideas to industry experts, investors, and probable customers or retailers. The networking groups provide a platform for showcasing your business ideas.
• Diverse industries: If you have home-based business ideas then California offers you the platform to set up a new business in a variety of industries. The fastest growing industries include construction, hospitality, healthcare, agriculture, and technology although the biggest industries in the state are the services sector including tourism, film industry, and agriculture. The industries also vary from one city to another like the largest industry in San Francisco is tourism while the largest industry in Los Angeles is the high-tech industry and then there is the Silicon Valley. You can choose your industry in accordance with your startup idea, obtain home business licenses, and make your enterprise operational.
• Robust Business Infrastructure: California, nicknamed the Golden State has a robust and strong economy, is ranked 5th largest in the world, and represents 15 percent of the U.S economy ($22.68 trillion). The clean and efficient economy along with innovative policies have helped change the industrial landscape thus helping new-age entrepreneurs to start a home-based business in California successfully. At the heart of the economy is the robust business infrastructure, which includes logistics infrastructure like railroads, ports, airports, trucking companies, and warehouses. The supply chain in California runs deep and is one of the key drivers of the economy.

Popular home-based business ideas

California is home to small and medium sized enterprises (SME’s) and a majority of such entities have grown from home-based business ideas. In order to understand how to start a home business in California, you need to first identify the type of home business that will bring you growth and success. There are several industries or areas where you can form a startup but if you are looking for trending ideas then here are some:

• Online Consulting Business: You can start a home-based business in California as an online consultant. The type of consulting will vary according to the knowledge and skills acquired over the years. Some of the key areas of online consulting include career consulting, leadership and team building, green living consulting, organization and efficiency, digital marketing, virtual assistant, social media consultant, and stress management among others.
• Online Services: This is a wide area and the type of work you offer will determine the home business licenses and permits required. The scope and opportunity is huge and encompasses several areas right from blogging to affiliate marketing, publishing ebooks, graphic designing, information research, and selling home-made products through ecommerce websites.
• Handmade Crafts: One of the areas that have gained popularity in recent times is handmade crafts. Entrepreneurs are actually converting their hobbies into serious businesses like jewelry designing, T-shirt designing, ceramics making, Wood DIY, handmade cards, pour paintings, stone or rock painting etc.
• Home-based food services: This is an area where you can start a home-based business in California. Food services have always been a high-growth area and there are a variety of niches that you can experiment with. Some of the popular ideas in this category include creating and selling baked goods, specialty items like gourmet chocolate, cooking instructor, nutrition coach, food blogger, home-based cookie business, food photographer, and home chefs or home cooked meals.
• Computer based businesses: There are different areas within this category that you can focus on depending on your strength and skills. It is important to understand that most businesses in this category will require home business licenses or permits. Some of the most popular areas include computer trainer or tutor, computer repair, desktop publishing, IT consulting, Tech blogging, technical writer, website design, App development, software development, and game development.

Steps to Start Home Based Business in California

If you are wondering how to start a home business in California then it is important to understand that there are certain aspects within the entire process that you will need to consider. There are specific elements that will drive your home-based business ideas from their conception stage to implementation and finally operational stage. Starting a business from home will provide you with greater flexibility in terms of time spent and initial startup expenses. So, let’s take a look at the key areas that you need to focus in order to start your home business successfully.

1. Create a business plan

Before you can start a home-based business in California, it is necessary to create a business plan. A business plan is considered to be a strategic tool for business owners and entrepreneurs. This type of strategic plan takes into consideration several aspects related to the conception phase, the operational phase, and the sustenance phase of a business. It helps entrepreneurs to focus on areas crucial to the overall success of the business like market research, need for home business licenses, short-term and long-term objectives. Some of the key areas of a business plan for home-based startup are:

• An executive summary of your home-based business ideas
• Research of the market you plan to launch in
• Existing and expected competition
• Marketing, Advertising, and Sales strategy
• Ideal customer identification
• Financial planning
• Operating plan
• Startup Expenses

2. Check zoning laws and regulations

Anyone can start a home-based business in California but it is always important to check local zoning laws and regulations first. It is important because if you start a home business without checking zoning regulations then your business can be red flagged by zoning officials and this can even lead to penalties. You are probably wondering what are zoning laws and how you can check out the laws in your area. Let’s look at an example.

3. Register Your Business

A business can have different forms or structures and if you are planning to start a home-based business in California then identifying the structure is important. When you choose a structure like a partnership, sole proprietorship, or LLC then the business registration requirements will be in accordance to the structure. If you form a domestic limited liability company then you will be required to file “Articles of Organization” to register the business. If you form a General Partnership (GP) then a “Statement of Partnership Authority” has to be submitted. If you are planning to form a sole proprietorship then you will be required to obtain home business licenses, permits, and zoning clearance. We at IncParadise can provide guidance on choosing the right business structure and also help you register your new business.

Start a California home-based business with ease!

4. Get Mail Forwarding

If you are someone who travels a lot or if you are residing outside California and want to start a business in the state then a mail forwarding service can be quite convenient and helpful. The service is also helpful if after you start a home-based business in California there is a permanent or temporary change of address. In such a scenario, all your important mail may get lost, stolen, or returned to the sender.

5. Check if you need to obtain EIN

Home-based business ideas can be transformed into a startup in California but the business structure will determine whether you need to apply for and obtain an EIN (Employer Identification Number). Normally, if you start a sole proprietorship business then you will be required to file taxes using your social security number (SSN). Simultaneously, if you were to hire employees or form a partnership or a limited liability company, then you will need to apply for an Employer Identification Number from the IRS. You can also obtain an Employer Identification Number even if you don’t require one as it has several benefits like it helps avoiding identity theft.

6. Register for taxes

If you start a home-based business in California then you will be required to register for taxes in the state. Whether your business is an LLC, corporation, or sole proprietorship, you will need to file franchise taxes or income tax return. Once you have formed your business and obtained home business licenses and permits, you will have to report all your income or losses from the business through individual income tax return using Form 540. According to the Franchise Tax Board, California, you may be required to report your business income as well as expenses on the IRS Form 1040 Schedule C.

7. Obtain necessary licenses and permits

Once you have applied for formation of a home-based startup, the next important step would be to look up home business licenses and permits you may require. In the state of California, there are primarily two types of licenses:

• General Business License: This type of license is applicable for any business owner including those planning to start a home-based business in California. The general business license will be issued by the city in which your home-based startup is located. This type of license is also known as a business tax certificate in some of the cities like the City of San Diego and City/County of San Francisco. You can find more information on the type of license or permits required from California’s CalGOLD website.
• Regulated Professions and Industries Licensing: The “Professions and Industries Licensing” is required by businesses only if they fall under specific categories and this is apart from your general business license. If your startup falls under categories or professions mentioned in the California professional licensure guide then you will have to apply for home business licenses and permits with the Department of Consumer Affairs (DCA) and the Department of Industrial Relations (DIR). If you start a home-based business in California like a real estate salesperson or broker, acupuncture services, Manicurists (nail care), and veterinarians among others will require this type of licensing.

Identify business licenses and permits required by your California Startup

Ready to Start Your Home Based Business in California?

A home-based business is quite different from the medium sized enterprises in terms of business structure, operations, and market although there are several examples of California home-based startups becoming big corporations with time. If you start a home-based business in California, you can leverage the state’s economy, the business infrastructure, and small business incentives. The first step though is to form or register your startup in the state. If you have been wondering how to go about registering your home-based startup then IncParadise can provide you with valuable assistance. We are a reputed California registered agent and our team of experts can guide you with the process and filing for starting your business in California.

Silicon Valley Startup Heaven

Some of the top entrepreneurs and first time business owners want to form a Silicon Valley startup as the business environment and startup ecosystem is just perfect when it comes to valuable resources and business growth enablers.

Silicon Valley startup ecosystem

Silicon Valley is home to different types of business organizations and institutions, which have facilitated the creation of a robust business environment. This environment is a part of the Silicon Valley startup ecosystem and is highly conducive towards the successful creation and operation of startups, leadership in several high-tech specialization areas, and disruptive business models. The ecosystem is driven by several components and has a variety of characteristics, which make the Silicon Valley system work in a synchronized manner thus making it conducive to register a Silicon Valley startup.

• The Micro level: Focuses on Product, People, and Pivot
• The Meso level: Comprises of Capital, Universities, Government, and Support Networks
• The Macro level: Revolves around Culture inspired by generations of startup founders

• Startups
• Large tech companies
• Investors
• Accelerators
• Universities
• Co-working spaces

Why is Silicon Valley good for startups?

The Silicon Valley startup ecosystem boasts of a dual ecosystem consisting of startups and large firms existing symbiotically. Silicon Valley is considered to be a comprehensively integrated as well as balanced business ecosystem that ensures startups are able to leverage from the leading-edge innovation, pro-startup culture, and pioneering entrepreneurship. The Silicon Valley ecosystem provides support to startups so that they can push forward their dreams into a global market. Some of the factors that play a key role if you plan to register a Silicon Valley startup are:

• Successful entrepreneurs as well as startups can enjoy high financial returns
• Availability of top-level global human resources for various stages of a startup
• Existence of strong business and industry like accounting, IT, law, etc.
• It is the most competitive market for venture capital (VC’s) and other investors
• Ivy league and top ranked universities like Stanford, UCSF, and UC Berkeley
• Most human resource clusters are anchored around these top universities
• Availability of top startup accelerators in the Silicon Valley provide startups with advice, mentorship, and resources
• The government plays an extensive role in shaping current and future technological trajectories
• There is a fine balance between open innovation, secret protection, and intellectual property protection amongst highly competitive industries
• There is a high mobility of labor at different management and talent levels
• There is a strong and positive culture of accepting failures leading to effective evaluation as well as monitoring

Top startup industries in Silicon Valley

The Silicon Valley as well as the Bay Area is considered as the greatest hub for new businesses and startups. This is because when you form a Silicon Valley startup; the existing and continuously evolving and expanding infrastructure provides the necessary platform to a business in its nascent stages. Silicon valley also provides a favorable advantage when it comes to the tech industry but the truth is that there are several other top startup industries in the Silicon Valley area that have garnered equal attention and reputation. Let us briefly look at the hottest industries in Silicon Valley.

• Fintech – Fintech or Financial Technology is a form of emerging technology, which focuses on helping financial institutions improve and automate the delivery of various financial services. If you are planning to incorporate a Silicon Valley startup in the Fintech industry then it is one of the most rewarding and rapidly growing industries. In fact, a report by Ernst and Young estimated that the California Financial Technology market was worth $7.1 billion in 2015. In the near future, there will be enormous growth potential for startups in terms of revenue generation in this industry due to the increasing use of Artificial Intelligence in Financial Technology. Today, it is considered as one of the top startup industries in Silicon Valley and some of the highly successful businesses in this sector include Braintree, Varo Money, Brex, Morningstar, Gravity Payments, and Acorns.
• Big Data – One of the areas or industries that are expected to even grow bigger in the years to come is Big Data. This is also one of the favored industries to incorporate a Silicon Valley startup as the existing market size globally was $41.33 billion in 2019 and its projected growth is $116.07 billion by 2027. This is more so because of early adoption of futuristic technologies like AI (Artificial Intelligence) and Predictive Analysis according to a report by Fortune Business Insights. Some of the top startup industries in Silicon Valley as well as global companies like IBM Corporation, Amazon.com, Microsoft Corporation, SAP SE, Oracle Corporation, Software AG, Infosys Limited, Cisco Systems, and Dell Technologies have been key players in the big data market.
• Blockchain – The Blockchain technology was first outlined in 1991 and was first implemented in 2009 for transactions being made using bitcoin. It is essentially a public ledger or a distributed database of records that comprises any or all transactions or even digital events taking place and is normally shared among participating entities. The wide variety of applications of Blockchain has attracted many entrepreneurs to incorporate a Silicon Valley startup in this industry. The market size of the global blockchain technology was valued at $3.67 billion in 2020 and is expected to grow quickly. You can register a Silicon Valley startup in the Blockchain industry as it is expected to expand or grow at a CAGR (compound annual growth rate) of 82.4% from 2021 to 2028. It is one of the most promising technologies in the IT domain and is projected to reach $69.04 billion by 2027.
• AI & Machine Learning – Artificial Intelligence is a big concept and machine learning is a subset of AI and together they are increasingly being applied in a variety of industries and areas including eCommerce, Workplace Communication, Human Resource Management, Healthcare, Cybersecurity, Logistics and Supply Chain, Chatbots, Space Exploration, and Smart Homes. If you are planning to incorporate a Silicon Valley startup in this industry then it is surely going to witness expansion and growth in the near future as market research firms like Tractica believe that Global AI market revenue is projected to reach $118 billion in 2025 while Machine Learning market size will reach $96.7 billion by 2025. The market share in the North American region for AI was $11.40 billion in 2019 while that of machine learning was $2.40 Billion. You can register a Silicon Valley startup as California is considered one of the best platforms for this industry and is home to industry stalwarts like NVIDIA Corporation, Alphabet (Google LLC), Apple Inc., Cloudera, Salt Security, and DeepMap among others.
• Medtech – Technology is at the heart of most industries today and this includes the medical industry as well. Medical Technology is commonly known as Medtech and it refers to a variety of technology enabled medical products, solutions, and services whose applications are mostly used for diagnosing and treatment of different diseases and medical conditions. Medtech applications can vary from ultrasound scans to high resolution laser machining, nano-medicines, and even electronic health records. The US Medtech market size for medical devices was worth $156 billion in 2017 and is projected to grow to $208 billion by 2023. This industry is an integral part of the US healthcare sector and one of the chosen areas for entrepreneurs to form a Silicon Valley startup. A report by Deloitte consulting revealed that the Medtech industry is well-positioned and geared up for driving the future of the healthcare industry and this is the right time to register a Silicon Valley startup in this industry.
• Biotech – Biotech is a field of technology where organisms or their products are used primarily for commercial purposes. It is also known as Biotechnology and uses living cells for developing or manipulating products for a variety of purposes including genetically modified food. It is a growth oriented industry that attracts entrepreneurs to incorporate a Silicon Valley startup. In fact, the U.S. biotechnology industry is expected to expand and grow at a CAGR (compound annual growth rate) of 9.2% between 2021 and 2027. This is more so because of its varied applications including in the field of genetic engineering, reducing environmental impacts of industrial processes, DNA fingerprinting, and increased crop yield among others. The US Market Size for biotechnology in 2021 is valued at $105.3 billion and its projected value in 2027 is $952 billion. This is an industry where entrepreneurs can register a Silicon Valley startup as it is considered to be expanding and evolving globally.
• Cybersecurity – One of the key areas of technology today is Cybersecurity. Its importance lies in the fact that digital attacks of technology driven systems, networks, and programs have become prevalent in recent times and hence, such systems or technology needs to be protected. Cybersecurity is a type of unified threat management system that helps in detection, investigation, and remediation of cyber or digital attacks thus protecting sensitive data or information. Identity theft is one of the most common examples of cyber attack. It is one of the top startup industries in Silicon Valley as the Cybersecurity Market is forecasted to grow from $152.71 billion in 2018 to $248.6 billion by 2023. The North American market was valued at $156.24 billion in 2020 and is projected to reach $352.25 billion by 2026. There are several areas of Cybersecurity where you can form a Silicon Valley startup like Deployment (On-premise and On-cloud), Manufacturing, Public Utility, Retail, IT, Financial Services and Insurance (BFSI), and Banking among others.

Start a new California business in Silicon Valley!

Forming Your Startup in Silicon Valley

Silicon Valley located in the San Francisco Bay Area is home to some of the top technology companies in the world. It is the headquarters of digital giants and other companies like Apple, Alphabet Inc.-Google, Netflix, Wells Fargo & Co., Facebook, Visa, Inc., and Chevron Corporation among others. The “Big 5” tech companies in the Silicon Valley generate revenue of $802 billion, which is more than the GDP of Switzerland and Saudi Arabia.

Prepare your startup idea and business plan

If you have a genius or innovative business idea then it’s time to incorporate a Silicon Valley startup. One of the first steps towards forming your new business is preparing and developing your startup idea and drafting a business plan. There are certain aspects that you need to consider while developing your startup idea as the business plan will be created accordingly. The most important aspect is to analyze the relevant market.

• Executive summary: This will include information about your startup and objectives in brief
• Market analysis: This includes information pertaining to industry research, competition, and launch market
• Company Structure: The structure of your startup like Corporation or LLC
• Branding, marketing and sales: This area will focus on modes and plan of advertising, marketing, and selling
• Product or service: Description of what your product or service is and how will it be beneficial for customers
• Financial projection and business model: A broad view of the earning potential of your startup and future financial scope
• Strengths, weaknesses, opportunities and threats (SWOT): A SWOT analysis will provide a realistic view of challenges, bottlenecks, potential threats, and opportunities available.

Networking/connect with industry experts

In this digital age, it goes without saying that the more people you connect with; the better it will be for your business. If you are planning to form a Silicon Valley startup then networking or connecting with industry experts will help further your startup plans or business expansion. Whether your business is currently in an ideation phase or moving towards a minimum viable product (MVP) stage; it is important to connect with industry experts as well as investors through a variety of networking channels and platforms including events, opportunities, coworking spaces, and meetups. The opportunities you can leverage when you register a Silicon Valley startup are:

• Meetups: One of the best options for networking within the Silicon Valley startup ecosystem is by becoming members of various Silicon Valley entrepreneur groups as they organize both events and meetups. Some of the top groups for meetups are Silicon Valley Young Professionals-SVYP (Santa Clara), Silicon Valley Entrepreneurs Toastmasters Club (Santa Clara), SF Tech Ladies (San Francisco), and Bootstrappers Breakfast – Silicon Valley Startups (San Jose) among others.
• Events: One of the greatest benefits for aspiring entrepreneurs or first time business owners in the Silicon Valley is the large number of tech and startup events that take place in the region. Some of these events are attended by executives of the top startup industries in Silicon Valley. The events can be categorized under:
  • Inspirational startup events
  • Startup Events on Best Practices
  • Events focussing on Network and forming a team
  • Hackathons
  • Investor Networking Events

Incorporate and register your startup

In most states including California, all you need to form a business corporation is submitting articles of incorporation to the office of the Secretary of State of the chosen jurisdiction. However, if you are planning to incorporate a Silicon Valley startup or a high-growth tech company then the business formation will require much more than simply submitting the articles and bylaws. Some of the aspects integral to Silicon Valley startups are rapid growth, issuance of equity incentives to employees, scaling your business, and creating the ability to take outside investments. So, how are most Silicon Valley startups formed?

Secure funding for startup

Every business requires a startup capital; some require higher investments while others can kickstart their business with minimal capital. If you are planning to form a Silicon Valley startup then depending on the industry the startup belongs to, you may need outside funding. The question is, how do you secure funding for your startup?

Looking to register your Startup in Silicon Valley?

Silicon Valley is one of the most economically vibrant, technologically challenging Diaspora of innovation. It is home to some of the biggest tech or IT companies in the world and is considered to be the gold standard for technological advancement. If you have an idea and are planning to form a Silicon Valley startup then we at IncParadise are here to assist you with business formation requirements. We can help you to incorporate and register your Silicon Valley startup, so that you can begin operations at the earliest and maximize your benefits of launching a business in the famed valley.

Registered Agent in California

A registered agent in California can be an individual or a firm, which is hired or designated by a business entity for the purpose of receiving service of process documents and notices, government correspondence, and different types of compliance-related documents on behalf of the said business entity. Some of the best California registered agents also provide a wide variety of services focused on business requirements like assisting with new business formation or existing business amendments, filing of Statements of Information, and helping obtain California certificate of good standing and federal tax ID among others. Whether you are hiring a new registered agent or planning to change a California registered agent, it is important to understand in detail the responsibilities and benefits you can derive by designating a registered agent.

What is a registered agent in California?

If you are thinking of forming a business corporation or a limited liability company in California, you will be required to designate a registered agent according to the California Business Codes. In fact, according to law, you will have to provide specific information pertaining to your chosen registered agent when filing the articles e.g., according to CA Corp Code § 17702.09 (2019), you have to provide the name and street address of the agent in this state pursuant to Section 17701.13. If you change a California registered agent, you will be required to notify the office of the California Secretary of state of the same.

Who can be a California registered agent?

The California Business Code dictates that one of the primary California registered agent requirements is that they should maintain a registered office, which should be a physical address in the state and not a PO box number. A California registered agent would also need to keep regular business hours so that they can accept service of process as well as any other legal correspondence on behalf of their clients or entities they are representing. If you had to choose the best California registered agent then who would it be or how would you choose? In reality, there are two scenarios –

• An individual as a Registered Agent where-in you or your company becomes a registered agent but this unfortunately is not an option in California. The state doesn’t allow entities like LLC or owners to serve as their own registered agents.
• A Commercial Registered Agent is the second option and applicable in California. If you are starting a new business in California, you will need to hire and maintain an RA. If you have an existing business and are not satisfied with the services of your current RA then you can apply to change a California registered agent. So, who is a Commercial Registered Agent? It is an individual or firm or third party that is compliant with the statutory requirements as specified in the California Code-CA Corp Code § 17701.13. A commercial agent is someone who should have represented a minimum of 50 or more domestic and foreign business entities and should have the experience of handling service of process for a period of one year. IncParadise is one of the best California registered agents with experience of handling and representing more than 10,000 business entities across the US including California. We are also fully compliant with the California Corporations Code requirements.

What does a registered agent do?

It is important to note that different states may have different California registered agent requirements as well as processes but the purpose of a California RA will be the same as an RA of any other state. So, what is the purpose of the best California registered agent?

• The primary purpose of the best California registered agent is facilitating service of process. Service of process is basically a procedure where a party (individual, business, or government) to a lawsuit gives notice of legal action to another party (business entity like an LLC or INC.), so that the said entity can respond to the proceedings before the court. A registered agent can accept the notice or legal documents on behalf of the party being served the notice pursuant to 416.10 of the California Code of Civil Procedure (CCCP).
• When you change a California registered agent then they will fulfill certain secondary purposes as well such as providing the business with a legal or physical address in the state. This is quite beneficial for non-US residents or those running a business in California while being based in another state. A physical address also means that notices and government or business documents can be received by the agent’s office during normal business hours as specified by the California Corporations Code.
• The type of services the best California registered agent provides can vary from one agent to another but some of the top agents like IncParadise provide a multitude of services depending on the requirement of a business entity. Most commonly, a top California registered agent provides new business formation including that of LLC and corporation apart from ensuring businesses are able to maintain their annual operating compliance with the state.

How Do I Change My California Registered Agent?

There are several reasons why a business would want to change a California registered agent with the most common reasons being:

• The number of business centric additional services offered
• Professionalism and credibility of the agent
• Handling of both domestic and out of state (foreign qualification) business
• Providing detailed information and guidance towards business requirement fulfillment

1. Select a new registered agent

The first step towards changing your registered agent is finding the right RA. You need to identify an individual or firm that can provide service of process and also represent you in California. If you are thinking of the cost of change of California registered agent then it is minimal. There are no state filing fees but there will be a change of agent fee. If you are searching for a new registered agent then here are some tips:

• Compliance: One of the primary factors that govern the choice of most business entities is compliance. It is important to ensure that your chosen RA meets all California registered agent requirements of the state and California Corporations Code. IncParadise is not only state compliant but also meets all state and law based requirements in California.
• Regular office hours: One of the primary California registered agent requirements is maintaining regular office hours so that any legal notices and business documents can be received by them on behalf of their clients.
• Physical Presence: A physical presence in terms of a business address is required by law. This helps businesses where owners reside outside the state. For example: If you reside in Michigan and want to operate a business in California, you will need a physical address. Some of the best California registered agents can provide you with a physical address in the state thus ensuring state compliances are met.
• Evaluate their services: If you are planning to change a California registered agent then you need to evaluate what services they are offering. One of the best California registered agents like IncParadise is a leading registered agent service provider in California because of the variety of business related services offered right from new business formation to obtaining tax ID, and filing of annual reports.

2. Notify your previous registered agent

If you are planning to change a California registered agent then it is important that you notify your previous registered agent of the same. Some businesses may think that removing an agent may lead to loss of credit but that will not be the case. At the same time, when you cancel the services of your previous registered agent, the agency or firm will require a confirmation of the fact that their name is not listed in the California state records as your registered agent. In such a scenario, all you need to do is provide a copy of the “change of agent” filing along with the entity records from the SOS website.

3. File California Statement of Information to the California Secretary of State

As a business entity wanting to change a California registered agent, you may ask, if there is any form that is required to initiate this process in the state of California. Actually, you are not required to file any form but have to simply inform the office of the Secretary of State. In fact, if your business is a domestic or foreign stock corporation or an LLC then you will have to file a “Statement of Information” while other business forms like limited partnerships or general partnerships have to file a statement of amendment. The purpose of the Statement of Information is to update the new agent information in the state records.

Want to Change your California registered agent?

Cost of Changing a California Registered Agent

There is no extra cost of change of a California registered agent except for the fee for filing the Statement of Information and the fee for new agent services, where the latter will vary from one agent to another.

Choose IncParadise as Your California Registered Agent

If you are planning to form a new business or thinking of expanding your existing business to California; the state and business laws make it mandatory for entities to hire and maintain a registered agent in the state, especially to handle service of process. If you want to change your California registered agent then it is also important to note that the new or chosen agent should have a physical presence in the state in the form of a physical address and not just a P.O.Box number. IncParadise, one of the best California registered agents and adheres to the regulations established by the office of the California Secretary of State.

California Foreign Qualification Process

If you have an established business in any other state like Delaware or Wyoming and want to expand your business activities to California then you will need to undergo foreign qualification
in California. The process for foreign qualification will vary according to the type of business. For example, California foreign LLC registration and fee will be different from that of a corporation. The California foreign qualification process is important and failing to foreign qualify can lead to penalties and prosecution. An entity may be subjected to a penalty of $20.00 per day for unauthorized intrastate business transactions. The entity may even be prosecuted by the California Attorney General and such an entity may be required to pay an additional penalty.

California Foreign Corporation Registration

If you are planning to form a foreign corporation in California then you will need to obtain a certificate of qualification from the office of the Secretary of State. This certificate permits an entity to transact intrastate business. The following steps will help you to identify the requirements for California foreign corporation registration.

• Name Registration: The first step towards foreign qualification in California is to choose a name and check availability. If the chosen name is available then you will need to register the corporate name with the office of the Secretary of State, Business Programs Division, pursuant to CA Corp Code § 2101 (2019). The fee for registration of a corporate name is $50. You will be required to also file a “Submission Cover Sheet” along with the name registration paperwork. If the chosen name of the foreign entity is not available for use in California then the entity will have to qualify using an assumed name.
• Registered Agent: An important aspect of California foreign corporation registration is designation of a registered agent for the service of process pursuant to CA Corp Code § 2102 to 2105 (2019). You can hire IncParadise as your California registered agent as we possess experience and expertise in foreign qualification in California and can help you qualify for the same.
• Certificate of Good Standing: It is also known as the certificate of existence or entity status letter depending on the state your corporation is registered in. You will require a Certificate of Good Standing from your home state or state of incorporation and will be submitted along with foreign qualification in California paperwork.
• Foreign Corporation Qualification: If you want to apply for California foreign corporation registration by yourself then you need to download, fill, and submit the Statement and Designation by Foreign Corporation form. It has to be submitted with the office of the California Secretary of State. You have to submit a current Certificate of Good Standing with the form along with a fee of $100 for foreign stock corporations.

Do you want to form a California Foreign Corporation?

California foreign LLC registration

Are you thinking of setting up a foreign LLC in California? If yes, then you will need to obtain a certificate of registration from the office of the Secretary of State. This certificate permits the foreign limited liability company to transact intrastate business. The following steps will help you to identify the requirements for California foreign LLC registration.

• Name Registration: The first step towards foreign LLC in California registration is to choose a name and check if it is available. The chosen name should be distinguishable in the SOS records from names of other limited liability companies in the state. If the chosen name is available then you will need to register the LLC name with the office of the Secretary of State. A name reservation is not necessary for California foreign LLC registration but you can apply for the same with the office of the Secretary of State pursuant to CA Corp Code §17701.09(a) and CA Corp Code § 17708.05 (2019). The LLC name can be reserved for a period of 60 days and the California SOS will issue a certificate of reservation for the same.
• Registered Agent: An important aspect of foreign LLC in California registration is designation of a registered agent for the service of process pursuant to CA Corp Code § 17708.02 (2019). IncParadise can be your California registered agent as we have the expertise and experience towards ensuring help with your California foreign LLC registration.
• Certificate of Good Standing: It is also known as the certificate of existence or entity status letter depending on the state your corporation is registered in. You will require a Certificate of Good Standing that has been issued within 6 months by a government agency in the state of formation. The certificate has to be submitted along with foreign qualification in California paperwork.
• Foreign LLC Qualification: If you want to apply for foreign LLC in California qualification by yourself then you need to download, fill, and submit the Application to Register a Foreign Limited Liability Company (Form LLC-5). It has to be submitted with the office of the California Secretary of State. You have to submit a current Certificate of Good Standing with the form along with a fee of $70. You can also avail of expedite services for California foreign LLC registration that are valid for documents being submitted in person (drop off) to their Sacramento office. There is an additional non-refundable $15 fee for counter drop off.

Do you want to form a Foreign LLC in California?

Need Any Assistance in Applying for California Foreign Qualification?

If you already have an LLC or corporation in any other state and if you are planning to expand to California then you will need to undergo the process of foreign qualification in California. As one of the leading registered agents in California, IncParadise can assist you with the process of California foreign qualification and also assist you with the process of incorporation in California.

Starting a Company in California

There are 4.1 million small businesses based in California today and stand among the top ten largest economies in the world. In 2019, the gross domestic product (GDP) was approximately $3.14 trillion with foreign direct investments controlling ownership in several businesses in the state. Entrepreneurs from several countries find it attractive to start a company in California as foreigners with Japanese entrepreneurs and firms leading the table with 3,880 firms followed by the UK at 2,303 and France at 1,888. You can also choose to register any type of business entity like LLC, professional corporations, limited partnerships, and other business entities and the California business environment will ensure your startup gets the initial positive thrust it requires.

California business or startup environment

The California business environment and startup ecosystem is different from that of any other state and this makes the state unique in terms of forming your first startup. As an entrepreneur in California, the business environment ensures strong economic growth but there are certain elements of the ecosystem that work together to aid in business growth. Some of the top elements are:

• It is an economy that grows constantly and consistently – One of the top reasons to start a business in California is the trillion Dollar economy, which is still growing at a steady pace. Today, California is considered as the Sixth Largest Economy in the world and accounts for almost 13 percent of the US output. The economy is extremely diversified and not dependent on any single industry. The single largest industry sector in this state is services and includes computer and software design, engineering, and motion picture production among others. Some of the other sectors driving the California economy include finance, export or trade, manufacturing, and tourism. The economic activity also differs from one region to another. For example, the key industries in the San Francisco Bay Area are High-tech manufacturing and Software development while key industries in Southern California are Motion pictures and tourism. These are some of the elements driving the strong economy and enabling the functioning of a robust California business environment.
• Foreign Trade and Trade Zones – One of the areas that attract entrepreneurs to start a company in California as a foreigner is foreign trade. California exported to approximately 227 foreign markets like Japan, Canada, Mexico, China, and South Korea in 2020. The exports from California in 2020 were $156.1 billion and that accounted for 10.9% of the total U.S. exports. Foreign direct investment (FDI) in the state was approximately $45.49 billion in 2019 and the top industry sectors for FDI are business services, industrial equipment, software & IT services, financial services, and communications. California is also home to the highest number of small and medium-sized enterprises (SME’s) in the trade sector including exports and imports. One of the salient aspects is the Foreign Trade Zone (FTZ), which is a key element in creating a high-end California business environment. The FTZ is responsible for providing exporters, importers, distributors, and manufacturers with opportunities that help in reducing U.S. Customs duties and for deferring payment until their product leaves the foreign trade zone. One of the top foreign trade zones is the City of Industry in Los Angeles County.
• California business or startup environment – California has been a leader where innovation and knowledge-based economy is concerned and it is home to several successful global companies that are globally renowned for entrepreneurship and creativity. The State launched the California Innovation Hubs (iHub) Program in 2010 with the primary objective of leveraging convergence between incubators, stakeholders, and investors for propelling startups towards growth and success. California Innovation Hubs (iHub) Program is one of the most advanced and forward thinking programs that ensure you can start a company in California as a foreigner and enjoy its many benefits. The iHub has helped in creating a robust innovation-based economic development support network across the state. There are 16 iHubs that have been responsible for making the California business environment highly creative and vibrant. Some of the top iHubs include the Sacramento iHub, iGATE iHub, CalValleyTech iHub, iHub San Joaquin, San Jose/Silicon Valley ET iHub, and Innovate North State iHub among others.

Steps to Form a California Company as a Foreigner

If you are an entrepreneur thinking if it is possible to start a company in California as a foreigner then the answer is yes. The second most important aspect is restrictions and California does not impose any kind of restrictions on entrepreneurs or startups registered in the state. It is important to note that the regulations and documents required to register a California business as a non-US resident would be quite similar to that of a foreign company. Let’s take a look at the various processes and steps that you need to take to successfully establish your business as a foreigner in California.

1. Prepare your California business plan

Every business needs a plan before they can actually start a business in California and this holds true for non-US resident entrepreneurs and business owners. A strong business plan can take a new business towards success and a weak business plan can lead to bottlenecks and problems. A business plan is essentially a business roadmap that contains the primary and secondary business objectives as well as strategies.

• Vision and Mission Statement
• Executive Summary
• Company Description
• Long-Term Goals
• SWOT Analysis
• Competition and Market Analysis
• Breakdown of Products and Services
• Marketing Plan and Sales Strategy
• Financial Projections and Funding

2. Secure business funding

If you are planning to start a company in California as a foreigner then there may be higher initial costs depending on the type of business activity like an IT firm will need investments in tech equipment. The thumb rule is that it will cost money to start any type of business and the expenses include cost of registration or incorporation in the state along with obtaining licenses and permits.

• Self-funding
• Small business grants in California
• Venture capital from investors
• Use crowdfunding
• Small business loans
• Small Business Administration investment programs
• Angel Investment
• Funding from Business Incubators & Accelerators
• Loans from Microfinance Providers
• California Small Business and Entrepreneurship Assistance Center Funding Opportunities

3. Choose a company name

A business name is as important to your business as are your customers because a customer can relate your business name to the product or services offered by your company. In a way, a business name can help in creating an excellent first impression hence it is important to choose the right name before you start a company in California as a foreigner. When choosing a business name, it is essential to ensure it is unique but not a tongue twister.

4. Choose a business entity

If you have decided to start a business in California as a non-resident or foreigner then the primary consideration should be the type of business entity you want to form. The different types of entity you can form in California include:

• Corporation
• Limited Liability Company
• Sole Proprietorship
• General Partnership
• Limited Partnership
• Limited Liability Partnership

• Cost of new business formation or start up costs
• Taxation
• Continuity and Transferability
• Liability and Asset protection
• Sharing of profits

5. Choose a Registered Agent

One of the primary requirements in the state of California for new businesses is hiring registered agent services. This is especially true if you plan to start a company in California as a foreigner. If you were to form a foreign corporation then it is mandatory to designate a registered agent for the service of process pursuant to CA Corp Code § 2102 and 2111 (2019). A California registered agent is also known as an agent for service of process and is appointed by a company mainly for the purpose of accepting all types of official correspondence and legal notices. A registered agent like IncParadise will not only handle service of process but can help you register a California business and also provide other business related services. IncParadise is one of the leading registered agent service providers in California today!

6. Register your company with California Secretary of State

There are several processes that you have to undergo in order to start a company in California as a foreigner. The first and foremost is registration of your business with the California Secretary of State. If you are a non-resident planning to register a California business then you will need to apply for foreign qualification. The type of registration will be dependent on the type of entity.

Planning to start your new business in California?

7. Get EIN

If you are a Non-U.S. citizen and are planning to start a company in California as a foreigner then you will need to apply for and obtain an Employer Identification Number (EIN) without the need to have a Social Security Number (SSN). The EIN is a 9-digit unique identification number and is also known as a Federal Tax Identification Number (FEIN). You have to apply for the EIN with the Internal Revenue Service (IRS) and have to obtain it before you register a California business as a non-US resident. Since you will be incorporating or forming your new business in the US; EIN can be applied for online.

8. Open a bank account for your business

It is always recommended to open a business bank account if you are planning to start a business in California as a non-resident. A business bank account also known as a Business Checking Account will keep your business income and expenditure separate from personal income and expenses. This will also help you to manage expenses and file taxes. You can refer to our bank account opening guide to understand how business banking works in California or the U.S.

• Certificate of qualification or registration
• Federal Tax ID Number (EIN)
• Proof of address
• Photo ID (such as a valid passport)
• Copy of the Business License

9. Obtain necessary business licenses and permits

You can start a company in California as a foreigner in a variety of sectors but you will need to obtain a business license or permit first. Applying for and obtaining a business license basically means that you have the permission to operate your business or transact in the state of California. There is no separate requirement for non-US residents when applying for a business license except that you may require a single or multiple licenses depending on your business activity and location. Once you register a California business, you can apply for any of the following licenses:

• A general business license
• Business license/permits for specific industries
• County business licenses

10. Know about the annual and ongoing state filing requirements

Once you start a business in California as a non-US resident, you will need to maintain it and ensure all annual requirements are met. This will help in keeping your business status active while helping you avoid any penalties or fines for non-compliance or late filings. Different types of business entities have different annual and ongoing requirements and some of them are:

• Name registration renewals
• California business license or permit renewals
• Statement of Information – Initial and Biennial
• Franchise tax
• State Business Tax
• State Employer Taxes

Looking to Start a Company in California?

If you are planning to start a business in California as a non-US resident, you will require California registered agent services to help you with the formation or incorporation of your new business. IncParadise is one of the top California registered agents and we have helped thousands of companies to register a California business.