DBA, LLC, Holding Co - I am SOOOoo Lost!

[Bec]

CCBill prefers you to be a company. So if I were to create an LLC, would it be some sort of generic name and NOT the name of the sponsor program? Where does the sponsor program fall into it? Is it a doing business as? or another LLC or??????

[tim460]

I know what it feels like to be sooo lost as you say, regarding legal issues. I think it would be very practical to have a section on this website dedicated to legal issues in the biz. It's basic, important stuff.

[Lee]

Your main LLC should be something you will use for all of your projects, adult, mainstream, bricks and mortar, etc, etc...

Then for each of your main projects, you create a DBA and operate those under the DBA.

Basically, by doing this, your liabilities are limited at the level of the primary LLC as all that company does is 'own' shares in the DBA companies.. It acts as if it is a holding company, nothing more, nothing less.

How we have our corporate structure setup, our main corporation operates several DBAs each of which have their own company address, bank accounts, etc and every month, at the end of the month, our main corporation is 'paid' by the DBA companies for providing hosting, content, traffic, marketing services, etc, etc...

If anything were to happen legally with one of the DBA companies, Gary and myself would be shielded asset wise, because our primary corporation doesnt actually have *anything* to do with the day-to-day running of the DBAs, it just gets payments from them for services rendered.

We actually have 2 main corporations in the State of Florida, each with 3 or 4 DBA companies operating below them, one for adult and online stuff, one for bricks and mortar companies, like the club we owned.

Anyone working in adult, IMHO should have an LLC or corporation setup to protect their personal assets.. Without exception... Whether we think of it as high risk or not, working in the adult industry is extremely high risk when it comes to the law... The last thing anyone needs is to end up in a lawsuit over one of their websites and to lose their home or property due to losing a lawsuit or having to defend a case in court.

The other major advantage of having DBAs setup below your main corporation is that if something ever does go wrong, in a major way, all you have to do is file bankruptcy for that specific company and the remaining businesses you operate are untouched by that one portion of your overall company going in to bankruptcy.

In our case it actually gets a little more complex to as our two primary corporations are owned by a third corporation, offering us even more shielding.

Regards,

Lee

[HunkyLuke]

wait till you start getting into third party holding companies, blind trusts, foundations and offshores

the only advice anyone should be giving you here is to get a lawyer and accountant, you need both of these to show you how to set things up in your location for max legal protection plus min taxes. And getting these from the start will save you a lot of time / money / headaches in the future when you really need them!

[Bec]

Thanks for the indepth reply Lee, that really helped clarify the various relationships the companies have to each other.

So is creating a DBA like forming a company for that name? I can see the sponsor name being a DBA, but what about the sites themselves? Do they need a DBA also?

[Lee]

We have DBAs for sets of sites, depending on what they are.

For example, each of the following types of site/service have their own DBA right now...

Affiliate Programs
Paysites
Free Sites / Galleries
Webmaster Services
Non-Adult Sites
Non-Adult Programs
Translations Commpany

There is 'some' interchanging between company ownership (domain names for example are owned by two different companies, but distributed among the DBAs in terms of usage), but for the most part 99.99% of the stuff we have which falls in to one of those categories, has its own DBA.... Specifically for that type of site, all of our adult affiliate programs for example are operated under Red Bag Productions... All of our non-adult affiliate programs, InterShark Media.

Regards,

Lee

[jIgG]

hm isn't it better to create LLCs instead of DBAs?

[Lee]

Yes it is.

That being said, when you want seperation of individual entities quickly, a DBA is quick to setup and helps with the seperation prior to setting up a LLC

Regards,

Lee

[gaybucks_chip]

A DBA is simply a Doing Business As.

All it does is create a pointer saying, in effect, "this entity doesn't really exist, it's another name for this other entity." Sort of like DNS for the real world

So you create, for example, widgets, LLC, and a DBA called Janky Enterprises and another DBA called Shiftless Unlimited. You register with the state (or county, depending on your local laws) and say "Shiftless Unlimited is a DBA (otherwise known as a trade name) for Widgets, LLC. or "Janky Enterprises, DBA Widgets LLC"

Legally, Shiftless, Unlimited doesn't exist, but if anyone goes after it, they will check the records and find out that it is another name for Widgets, LLC.

By the way, in many states, individual proprietors can do DBAs legally, so, for example, you could have Joe Blow doing business as John Smith, which would allow Joe Blow to sign contracts and enter into agreements as somebody other than who he is, shielding his true identity at least a little bit. Of course, if he gets sued, then it will be Joe Blow, and not John Smith, who gets sued.