How to Start a Holding LLC Company in 2022 [Step-by-Step] - YouTube

so why did the business owner give an umbrella  to his employee because he had to cover for him  

all right let's go ahead and talk about how to  start an umbrella or holding llc company step  

by step so first off you need to know that an  umbrella company is basically a business entity  

that controls multiple businesses at once so if  we're thinking about like a company chart at the  

very top you have an umbrella company right hence  the name umbrella company because it's kind of  

like an umbrella and then beneath the umbrella  company you have other operating businesses or  

assets which are typically called subsidiaries now  you may hear umbrella companies and subsidiaries  

call different things so for example some people  refer to umbrella companies as the parent company  

in the subsidiaries as the child companies or  you may hear umbrella companies referred to as  

holding companies all right it's all basically  the same thing now the holding company does not  

generate any revenue or run any specific business  operations it simply holds stock in the subsidiary  

or other operating companies whereas the  subsidiaries are actually the operating companies  

like those businesses actually produce revenue  and then the revenue and profits are consolidated  

inside of the umbrella company all right so  the first step step number one for creating an  

umbrella or holding company is simply to form  the business entity now typically you're going to  

want an umbrella company established as something  like an loc or a corporation because that offers  

limited liability protection which basically  protects your personal assets against any other  

business disputes or legal issues so let's  say for example that you decide to create an  

llc umbrella company what you need to do first  is to complete the articles of incorporation  

and then submit them to your secretary of state  office the biggest things you're gonna need at  

this point are number one you're gonna need the  name of your holding company number two you need  

a registered agent which could be you or someone  else that you choose and then number three you're  

gonna need to pay the cost to get the business set  up now if you've ever established an llc before  

then the process is pretty similar for creating  an umbrella company so after that you're ready to  

move into step number two but really quick before  i move into step number two if you are new to our  

channel welcome i'm sean with life accounting  the accounting company that saves people from  

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subscribe if you're really serious about building  tax-free wealth alright so step number two  

create your operations agreement or your bylaws  for how your umbrella company will operate  

now this is also pretty standard when it comes to  creating and setting up an llc in general but the  

key in this step is to make sure that you create  a cause and your operating agreement establishing  

that the new loc which will be your umbrella  company is authorized to form subsidiary companies  

because this is really where you start to  establish the control between the parent company  

and the child company again that could be  the umbrella company or the holding company  

and it does this through this legal step where  you're creating these provisions and clauses  

in your operating agreement and while you're at  this step of course it's important to make the  

decision of who will actually manage your umbrella  company like who are the managing partners and  

then who are going to be your limited partners as  well as establishing a board of directors because  

all these parties would likely need to sign  off on these bylaws or operating agreements  

now after that you can move into step number  three which is to create your subsidiary  

now there are two ways to transition into step  number three so if you're starting a new company  

from scratch and you can simply create a new  llc as your umbrella company and then create  

another new loc that would act as your subsidiary  company and after you get these two entities set  

up there's just one more step that you need to  take in order to tie these two entities together  

which we'll get into in a second right after  we talk about the second way to transition  

into a new loc because of course after working  with so many people the opposite scenario is  

true right like more often than not you already  have an llc that acts as an operating company and  

what you want to do is turn your existing llc  into a subsidiary of your new umbrella company  

and in this case what you need to do is create  an llc that will act as your umbrella company  

by following steps number one and step number  two and now with your existing loc what you  

need to do is create a new operating agreement or  amend your operating agreement for your existing  

loc so what you need to do is basically place a  provision within your articles of incorporation  

or your existing operating agreement stating  that no changes can be made to the management  

of the operating company or the subsidiary  company without the umbrella companies approval  

okay and now this essentially gives complete  control to the umbrella company over the  

management of its subsidiaries all right so if  you already have your articles of incorporation or  

operating agreement just simply go back and amend  that and typically you can do that around your new  

annual registration period for your loc and if  you have multiple llc's like you have multiple  

operating agreements and you're trying to tie it  all together and you would just repeat step number  

three to get them all under your new umbrella  company your holding company your parent company  

whatever you want to call it right all right so  let's tie all of this together step number one  

create a new llc that will act as your umbrella  company step number two create bylaws that specify  

the intent of the new loc which is to be a  holding company and that's step number three  

create a new operating llc or amend an existing  llc to become a subsidiary of your new umbrella  

company now if you're wondering exactly why you  should start an umbrella or a holding company  

then make sure you watch my video on should you  start a holding company linked above or coming up  

next because of course there are many advantages  and some disadvantages that you need to be aware  

of before you actually go about setting up  a holding or umbrella company now i hope you  

enjoyed this brief video on how to start an  umbrella company step by step if you have any  

questions make sure you put them in the comment  section below and i'll try to get to as many as i  

possibly can as always thank you so so much for  watching and i'll see you in my next video you