We are at a position like this now, we have three co-founders, our beta version is almost ready to launch, but we haven't legally set up our company and haven't settle any related documents yet. Should we settle all legal and related issues before we officially launch our beta? Or we can just launch at first, keep improving the product iteratively, and set up company legally later at some other appropriate time? Really appreciate for any suggestions and help!
A better question is how much do you have to loose if you are sued.<p>If you own a house or fancy car, form a LLC today. I would also sign agreements with any partners to use binding arbitration in your home state if there is a dispute. That way neither side can exploit an advantage with expensive lawyers in the event of a dispute.<p>If you rent an apartment and only have $18 in your checking account, it is less of a risk.<p>You will certainly want a company before you start having customers.
There are technicalities you can (and will) skip on as you run your first company (pg has a good article touching on this, btw), but basic incorporation is not one of them.<p>Incorporating shouldn't take you more than a week and $200, and that is in parallel with everything else you have going on. Just do it and protect everyone.<p>There really isn't a reason that you can't do it.