The short answer is yes, you have to be a corporation to raise VC funding
VCs will want you to be a C-Corp for a few specific reasons. The main advantage of an LLC over a C-Corp is that the taxes are not flow through. In other words, your company’s tax situation will not hit the bottom line of the VC. As VCs are generally structured to be flow through tax entities, if your company was a LLC, your tax situation would flow through the VC and directly to their investors. This is not a good place to be and VC investors demand that we only invest in C-corps to stop this problem.
To read the full, original article click on this link: Do You Need To Be A Corporation To Raise VC Funding? | Ask the VC
