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A popular approach these days seems to be for founders to regale investors early with a pitch touting the newest “million-dollar idea.” A C-corporation is more complex and expensive, and is recommended only if you expect to pitch to professional investors who demand preferredstock, or to more than 100 potential shareholders.
But before your startup signs up and cashes that $[XX,000] check, your startup’s co-founders should sit down and evaluate the incubator’s offer. Most incubators take common stock and sit “side-by-side&# with the founders, but some may want some (weak) preferredstock and/or dilution protection.
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