Cryptocurrency Q&A
What are the disadvantages of a small proprietary company?
What are the disadvantages of a small proprietary company?
StormGlider
Mon Dec 09 2024
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7 answers
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I'm interested in understanding the potential downsides of operating a small, proprietary company. What are the main disadvantages or challenges that such businesses typically face?
7 answers
DigitalLord
Wed Dec 11 2024
Costs and financial obligations are significant considerations. Setting up and maintaining a private limited company involves various expenses, including registration fees, legal fees, and ongoing compliance costs.
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CryptoProphet
Wed Dec 11 2024
Personal guarantees and liability are risks associated with private limited companies. Directors and shareholders may be required to provide personal guarantees or be liable for company debts in certain circumstances.
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SakuraBlooming
Wed Dec 11 2024
Restrictions on company activities can also be a drawback. Private limited companies may face limitations on the types of businesses they can engage in and the geographical areas they can operate.
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DaeguDiva
Wed Dec 11 2024
A private limited company faces administrative burdens. This includes maintaining detailed records, holding regular meetings, and adhering to various compliance requirements.
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CryptoDynastyLord
Wed Dec 11 2024
Limited stock exchange access is another disadvantage. Private limited companies may not have the same access to capital markets as public companies, making it challenging to raise funds through equity sales.
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