Key Takeaways

  • Popular LLC companies span across industries including tech, retail, entertainment, and hospitality.
  • Notable LLCs include Google (pre-Alphabet), Amazon Services LLC, and The Walt Disney Company subsidiaries.
  • LLCs are often used for flexibility in management, tax efficiency, and brand protection.
  • Many entrepreneurs use LLCs as holding companies or to separate business ventures under different brands.
  • Famous individuals, such as Beyoncé and Shaquille O'Neal, manage business operations through LLCs.
  • Forming an LLC does not prevent a business from becoming highly profitable or expanding globally.

Top LLC companies are ranked by Forbes Magazine, with over 200 firms making it into the rankings in recent years.

America's Largest Private Companies

These are America's largest private companies, and in 2017, they made a combined revenue of $1.57 trillion and employed 4.7 million people. Cargill and Koch Industries secured the top two places last year, with Cargill at the top spot for 10 years in a row with $109.7 billion in revenue. Albertsons, Deloitte, and PricewaterhouseCoopers round out the top five. Uber made its first appearance on the list at No. 52 along with other recognizable newcomer names like ADT and Red Lobster.

To be included on the Forbes list, companies must:

  • Have revenues that exceed $2 billion
  • Have too few members to file financial statements with the SEC
  • Only have restricted shares, like family or employees
  • Exclude foreign companies that do not pay income tax
  • Be under self-ownership or owned by less than 50 percent by another private, public, or foreign company

Examples of Popular LLC Companies

Limited Liability Companies are favored by both new entrepreneurs and established enterprises. Many well-known brands operate as LLCs or have structured parts of their business as LLCs for flexibility and liability protection. Here are a few notable examples:

  • Amazon Services LLC: A subsidiary of Amazon.com, this LLC handles fulfillment and customer service, showing how large corporations use LLCs for specific functions.
  • Google LLC: Before restructuring under Alphabet Inc., Google operated as an LLC, emphasizing its startup roots.
  • Nike Retail Services LLC: A branch of Nike, Inc., this LLC focuses on the retail side of operations.
  • Apple Services LLC: Used by Apple Inc. to manage services like Apple TV+ and iTunes.
  • Sony Music Holdings Inc. LLCs: Subsidiaries structured as LLCs help manage risk and intellectual property.

These structures allow for distinct legal and financial separation of business functions while maintaining overall brand cohesion.

Reasons to Form an LLC

Depending on how you form your company and how many investors and employees you plan to have, a small business can benefit from an LLC structure because it eliminates the double taxation issue found with corporations and provides some personal asset protection for members.

You should research in which state you receive the most benefits when forming an LLC. Delaware has been a popular option because of its low costs. Costs aside, it makes sense to form an LLC in the state where you primarily conduct business.

LLCs do not require a lot of maintenance like corporations do, and they make it easy to add partners or sell their interest to someone else.

Why Major Companies Use LLCs

While many associate LLCs with small businesses, major corporations also use LLCs for strategic purposes. These include:

  • Risk Mitigation: By isolating business units in separate LLCs, companies reduce the chance of a legal or financial issue spreading throughout the organization.
  • Brand Protection: LLCs help preserve intellectual property rights and separate branding efforts.
  • Tax Flexibility: LLCs often offer more flexible options for managing profits and losses across business divisions.
  • Operational Segmentation: Separate LLCs can manage different geographic markets, product lines, or services, streamlining administration and reporting.

For instance, Hilton Worldwide uses numerous LLCs to operate different hotel locations, and Disney uses LLCs for different production studios.

Advantages of Forming an LLC

Advantages of structuring as an LLC include:

  • Liability protection for members
  • Flexibility in management
  • Pass-through entity for tax purposes
  • Flexibility in allocating income and losses

Common Industries Using LLC Structures

LLCs are common in the following sectors due to their combination of flexibility, tax efficiency, and liability protection:

  • Tech: Companies like Google (formerly Google LLC) and Amazon Services LLC illustrate the model’s success in tech.
  • Real Estate: Many property management and development firms form LLCs to shield owners from personal liability and simplify transactions.
  • Entertainment: Artists like Beyoncé (Parkwood Entertainment LLC) and Taylor Swift use LLCs to manage tours, royalties, and branding.
  • E-Commerce: Online retail brands use LLCs to operate stores, manage inventory, and comply with state regulations.
  • Healthcare: Practices and healthcare startups use LLCs to protect professionals from malpractice liability while benefiting from pass-through taxation.

This wide usage shows that the LLC structure supports both creative and operational goals in many industries.

Disadvantages of an LLC

Potential disadvantages include:

  • Some states charge additional fees
  • You can split income, but unlike an S corporation, you may be required to pay self-employment or payroll taxes
  • Some states forbid professional groups, like doctors or attorneys, from forming an LLC
  • Restrictions on membership transfers
  • Single-member LLCs have reduced asset protection, and some states provide none

Mistakes to Avoid When Forming an LLC or Corporation

The most common business types are corporations (S and C corporations) and LLCs. It's important to understand each of their features so you pick the option that's best for you. One of the biggest mistakes people make is assuming they are too small to need a corporation or LLC. Examples of mistakes businesses can make regarding choosing the wrong business type are:

  • A freelance writer creates a C corporation and is taxed twice, resulting in significant income loss.
  • Two partners create an S corporation for their consulting business, which means they have to pay tax on their respective ownership. They had wanted to allocate 80 percent/20 percent, which means they needed to form an LLC to have more flexibility.

Don't necessarily choose Delaware or Nevada to set up your business just for low filing fees and lack of state income tax, as these benefits are typically more lucrative for larger companies, not small businesses. If you have less than five shareholders, choose the state where you have the most physical presence; otherwise, you are likely to run into a number of problems.

Setting up a corporation or LLC is not the same as getting your business license. Most businesses need to set up some type of licensing, even freelancers working from home. Check with your local city municipality to find out what is required.

If someone can show you did not adequately maintain separation between personal and business assets, they can potentially “pierce the corporate veil,” exposing your personal assets. To keep this from happening, you must:

  • Use your business title when signing any documents to keep from giving the impression you're acting in a personal capacity.
  • Ensure no mixing of funds.
  • Register a DBA name.
  • Always submit your annual reports/annual statements on time as required by your particular state.
  • If you operate in additional states, file for foreign qualification.
  • File Articles of Amendment every time you have important changes.

Even if you follow all these requirements, you won't be protected if you are operating a business that engages in unlawful or fraudulent acts. If you break the law, you are personally liable.

Celebrities and Entrepreneurs Who Use LLCs

Many high-profile individuals manage their ventures through LLCs. This structure allows for privacy, control, and legal protection while enabling them to branch into multiple industries.

Examples include:

  • Beyoncé Knowles: Operates Parkwood Entertainment LLC, handling her music, production, and branding efforts.
  • Shaquille O'Neal: Manages a portfolio of businesses through various LLCs, including investments in food franchises and fitness.
  • Taylor Swift: Uses multiple LLCs to manage her intellectual property, touring operations, and real estate holdings.
  • Kylie Jenner: Operates Kylie Cosmetics through an LLC, demonstrating its value for brand-based businesses.

Entrepreneurs follow similar strategies, forming LLCs for each business line to isolate risk and streamline finances.

Frequently Asked Questions

  1. Can large companies operate as LLCs?
    Yes, many large companies operate entire divisions or subsidiaries as LLCs to manage risk, simplify taxes, and maintain brand separation.
  2. Why do celebrities use LLCs?
    LLCs help celebrities manage multiple income streams, protect assets, and retain control over branding and intellectual property.
  3. What are some of the most profitable LLCs?
    Amazon Services LLC, Google LLC (prior to Alphabet), and companies like Nike and Disney operate highly profitable LLC subsidiaries.
  4. Can an LLC have multiple brands under it?
    Yes, LLCs can operate as holding companies or have "doing business as" (DBA) names to manage multiple brands under one legal entity.
  5. Is an LLC better for online businesses?
    Often yes—LLCs provide liability protection and allow online businesses to operate flexibly across state lines with easier tax management.

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