Three college friends start a new mobile messaging service in the hope that venture capital investors will buy part of the company within a few years. Which form of ownership should they choose?
A) partnership
B) limited partnership
C) corporation
D) joint venture

Question

Quizplus · Accepted Answer

A corporation is the best choice for a new mobile messaging service hoping to attract venture capital investors because it offers the most flexibility for ownership and funding. Additionally, corporations have limited liability protection for their owners, which is important in a technology-based business where there is a higher risk of lawsuits. A partnership or limited partnership may limit the ability to attract investors or raise capital, while a joint venture is typically formed for a specific project and may not be the best structure for a long-term business.

Three College Friends Start a New Mobile Messaging Service in the Hope