Deciding on the name for your to-be-formed company can be a stressful process given the seemingly endless number of possibilities and the limited legal requirements. Whether you have brainstormed a robust list of potential names and are having difficulty taking the final plunge, or are just now starting your search for the perfect name, we believe the practical considerations and legal overview below may be helpful to both new and experienced entrepreneurs alike when it comes to navigating the name selection process.
What is a corporate name?
The commonly used term “corporate name” is a bit of a misnomer, as certain state naming requirements apply to non-corporate entities as well. As most entrepreneurs are likely aware, entities must adopt an official name at formation that complies with certain state-specific legal requirements. While the requirements for legal names tend to vary in minor ways state-by-state, there are two basic requirements that will need to be considered regardless of the entity’s state of incorporation:
- A corporate name must always include an expressly authorized “suffix” (often referred to as an “entity designator” or “entity indicator”) indicating the company’s entity type and limited liability status; and
- The proposed corporate name must be distinguishable from those of existing entities in such state of incorporation.
Though the focus of this article is on corporations and limited liability companies (which are by far the two most prominent entity structures used for aspiring venture-backed startups), it is important to keep in mind that certain name-related legal requirements can apply to other entity types as well.