I’m considering buying a substantial minority stake in a small Midwestern green-chemistry company focused on the commercial cleaning sector. The company is currently structured as a B corporation, and I’m unclear about the implications. Will this limit my future earning potential? How can I have the company converted to a more conventional structure as a condition for the investment?
I think you mean C corporate structure. It provides the strongest layer of corporate protection for the individual or entity investing in that operation. It has historically caused a double taxation situation, which might be mitigated with the recent corporate tax law changes which provide a decided cut in the C corporate tax liability while only on some in the LLC or LP structure.
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