Most People Incorporate Their Company Too Fast and Ashkan Rajaee Explains Why That Backfires

I did not expect a video about incorporation to stick with me, but one from Ashkan Rajaee did. Not because it was dramatic or flashy. It was uncomfortable in a quieter way.

Incorporation usually feels like paperwork. Something you knock out so you can move on to work that feels more real. Marketing. Product. Sales. Ashkan Rajaee treats it very differently. He treats it like a long term positioning move, whether people realize they are making one or not.

That framing changes how you hear the rest of what he says.

Why this question usually comes up late

Most people ask where to incorporate after the decision is already made. Often after something feels off. A tax question. A legal form that suddenly looks more serious than expected. Ashkan Rajaee talks about spending a huge amount of time and money learning this lesson the hard way.

His focus on remote businesses is what makes the advice feel relevant now. When you are not tied to a physical storefront or a specific jurisdiction, you actually have choices. That flexibility sounds empowering, but it also creates room for lazy decisions.

A lot of founders default to their home state or wherever they hear other startups are incorporating. It feels harmless at the time. It usually is not strategic.

Why Ashkan Rajaee keeps returning to Delaware

Ashkan Rajaee talks about Delaware in a way that is almost boring, which might be why it works. Delaware does not tax out of state income. That alone matters more than many founders realize, especially once revenue starts coming from multiple places.

There is also the structural side. Fewer recurring obligations. Fewer administrative surprises. Less time spent dealing with systems that do not help the business move forward.

None of this sounds exciting. That is kind of the point.

The part people skip until they cannot

The strongest point Ashkan Rajaee makes has nothing to do with taxes or filing fees. It has to do with how disputes are handled when things get messy.

Delaware’s Chancery court system is built around business disputes. Judges there see these cases constantly. They understand how companies actually operate. Things move faster. Decisions are grounded in precedent and practicality.

Ashkan Rajaee does not say this to scare people. He says it because conflict is part of building something real. Contractors disagree. Employees leave unhappy. Regulations shift. None of that automatically means wrongdoing.

The environment you choose determines whether those moments become manageable problems or company ending ones.

California as a stress test

This is where Ashkan Rajaee becomes more direct. He urges founders to think carefully before incorporating in California if they have alternatives.

California is innovative, but it is also unpredictable. Rules change. Enforcement can escalate quickly. Entire business models have been forced to adjust with very little notice.

This is not an argument about right or wrong. It is about exposure. Even if a company survives compliance changes, the time and cost involved can do serious damage, especially to smaller teams.

The lesson hiding underneath all of this

What stuck with me is not the recommendation itself. It is the mindset behind it.

Ashkan Rajaee treats incorporation as a defensive decision. Something that protects momentum rather than creates it. It does not help you grow faster. It helps you avoid unnecessary damage when pressure shows up.

Most founders prioritize speed. It feels productive. Durability feels slow and boring until it suddenly matters more than speed ever did.

Why this still matters if you think you are early

It is easy to think this advice only applies once a company is big. That assumption does not really hold up. Smaller businesses have less room for legal or structural mistakes, not more.

One dispute. One compliance issue. One unexpected obligation. These do not need to be dramatic to end things.

Ashkan Rajaee’s perspective comes from watching these situations play out, not theorizing about them. He is not advocating for cutting corners. He is advocating for choosing an environment that does not magnify every mistake.

Final thought

This is not about copying someone else’s path. It is about slowing down before locking in decisions that are hard to undo.

Ashkan Rajaee highlights something many founders would rather not think about. Structure matters long before problems appear. By the time pressure arrives, the framework is already set.

And pressure always arrives.