Delaware’s centuries old Court of Chancery has written most modern U.S. case law, while interpreting Delaware’s General Corporation Law, which is known as the most usable and advanced business formation statute in the nation.  The Division of Corporations in this business-friendly state provides state-of-the art service to customers.

The Division’s 2010 Annual Report, summarized below reviews progress, developments, and marketing efforts which keep Delaware the premier state for incorporations.

New entity formations grew 15.5 %

70% off all new filings in 2010 were LLCs

24% of new filings were corporations

2.5% increase in active business entities since 2009

17 consecutive months of growth since the national economic recovery began in 2009, with 20% growth in the first three months of 2011

76% of all new Initial Public Offerings (IPO’s) are Delaware entities. (Such as LinkedIn & Pandora Media)

Incorporation revenue made up 26% of the State’s general fund for 2010

Marketing efforts included many trips worldwide looking for opportunities to expand Delaware’s global market share

The total package, with Delaware’s General Corporation Law, Court of Chancery, and Division of Corporations working together to reinforce each other, make Delaware the premier home for corporations today.

To view the complete report, go to http://www.corp.delaware.gov/10CorpAR.pdf

1.  Labor department statistic says unemployment rates have doubled among college graduates.

2. Job offers to college graduates have dropped 20% from 2008 to 2009.

3. More  college grads are going into business for themselves and are willing to take the risks of business ownership.

4. College kids are changing the way they get jobs by creating their own businesses.

5.  Entrepeneurship among college graduates of all ages is at a 15 year high, they are going into business for themselves.

6. Current unemployment with college graduates is at 4.3%, current National unemployment rate is 8.9%.

7.  26% of new businesses are created by people 20-34 years of age.

8.  Small business is the backbone of America and the younger generations are the future.

The highlight of the event is the “Annual Report” given by Richard J. “Rick” Geisenberger, the chief Deputy Secretary of State and Director of Corporations. This year he reported:

Delaware is now the home to 890,000 domestic entities. They include 260,000 corporations and 630,000 LLCs, LPs and Statutory Trusts. An additional 11,000 entities from outside Delaware are registered here as “foreign Entities”. Delaware, which has always had more chickens than people, now has about one company for every person who lives in the State. Most states have about 1 company per 20 people.

Delaware is home to 63% of all fortune 500 companies this year and was the choice of 734 of the 907 new IPO’s (Initial Public Offerings) in the past 7 years. IPO activity reflects the dismal economic business climate in the USA today. It wasn’t long ago that more than 400 IPO’s were launched in a single year, then the total fell abruptly to 28 new IPOs in 2008, then 37 in 2009 and 53 so far this year. The upward trend the past three years could be called a recovery, but still a poor showing when compared to the boom years of the past.

A new trend is emerging however, giving hope for more business. Foreign companies, especially from China, are incorporating in Delaware and going public in the USA. Watch for this trend to continue as China becomes the dominant player in manufacturing for the global markets.

Delaware’s Court of Chancery still makes the news regularly for its many high-profile cases. This year we saw a battle between EBAY and CRAIGSLIST fought in Delaware just up the road from my office. Meg Whitman, and the EBAY group, won this one.

Delaware has been working with the U.S. Treasury Department and the U.S. Department of Justice to reduce the incidents of the fraudulent use of Delaware companies in the International arena. Since Delaware prohibited Bearer Shares in 2003, it has been proactively issuing regulations that are designed to help prevent the fraudulent use of companies.

The U.S. Department of the Treasury has proposed several drafts of a plan to make the ownership of companies easier to trace. Currently, Registered Agents are not obliged to keep Beneficial Ownership information on the companies we form for our customers. In Delaware we are required to keep an up-to-date record of the “Communication Contact”. However, in the future the Department of the Treasury is recommending that Registered Agents will be responsible for keeping Beneficial Ownership information accurate and current.

As a final bit of good news, Mr. Geisenberger reported that the Division of Corporations brought in $878 Million dollars in the last fiscal year which accounted for 27% of the State of Delaware’s budget, emphasizing the importance of this effort for the whole state.

Environmentally friendly industries are currently growing at a time when many others are dwindling.  According to MSNBC, the fastest growing sectors are recycling, energy efficiency, solar, wind and water conservation.  This “green” market is a hot bed for innovative thinkers and entrepreneurs who have what it takes to start a ground-breaking environmentally responsible business on their own.

A 2008 Dechert LLP Annual Report on Trends in Trademarks indicated 2007 was the busiest year ever for trademarks.  There were 300,000 applications for the first time in history, which surpassed the old record of 289,000 during the Internet surge of 2000.  The word “green” was the most popular branding of all trademark applications.  In 2007, the number of applications containing the word “green” increased from 1100 to over 2400.  This was the third year in a row in which the word “green” has significantly increased in the number of applications.  Applications for incorporating the word “earth” increased approximately 60% from 550 to over 900 in 2007.

Due to the recent economic downturn, it is only inevitable that the overall number of patent and trademark applications have decreased.  However, the Dechert LLP Annual Report for 2009 indicated that “applications for marks containing the word GREEN increased 32% in 2008 (to more than 3,200 filings), ECO-prefix marks were up 86% (with 1,700+ applications), and applications for more than 500 ENVIRO-marks were filed, representing a 22% jump. The word CLEAN was also a popular buzzword, appearing in over 1,000 marks to suggest environmental friendliness, up 30% from the year before.”

While there are some industries that will suffer from the hardship of extreme gasoline prices, there are other markets that will flourish.  Being environmentally conscious is a worldwide trend that will continue to escalate and intensify during the coming years.  When considering starting a new business venture, think how the new company can prosper and thrive in an ever growing “green” world.

1. Environmental Consulting – Going green is no fad – it is a very real and growing industry and is valued at $17.8 billion and is expected to grow by 9 percent per year for the next 5 years.  Every business sector can expect to be affected by the green wave.  Expertise will be in demand for air, soil and water quality management.
2. Translation and Interpretation Services – The old adage that “talk is cheap” does not apply to the new global economy and basically any service that can bridge the communication gap is very valuable.  This segment grew at 18 percent last year and is a $2.7 billion industry.  Budding segments within this industry would include healthcare, website translation and multi-language marketing materials.
3. Home Health Care – Even with the current legislation – this segment is expected to expand by an average of 4.9 percent for the next 4 years.  Out of hospital care and less expensive alternatives are very appealing to the growing elderly population in America.  Physical therapy fields and non-medical home-care hiring are expected to be the leading segments.
4. Mobile App Design – It all started with the iPhone and now with the iPad and all the web-enabled devices available – the market for mobile apps has never been greater.  Demand will be high for programmers, developers and designers.  According to the Dow Jones Venture Source – in the past three years – location based apps have received $656 million.
5. Ferryboats and Inland Water Transportation – Yes – believe it or not – the old fashioned ferryboat is making a comeback.  Sparked by a rise in urban highway congestion – privately run ferry services as well as tourist excursions are on the increase.  A high concentration of success has been found in the Pacific Northwest and the Great Lakes.  As part of the 2009 Economic Recovery Act – the production of ferryboats and terminals is expanding.  This industry grew about 17 percent last year.  One new Coast Guard certified ferryboat that carries 150 passengers costs about $6 million.

While no new business venture is a sure thing – these trends certainly deserve some attention and those who are able to offer complimentary services to these industries are targeting a very real and successful goal.   Whatever industry you serve – we at Harvard Business Services, Inc. are happy to serve you!