There are various classification and terminologies associated with companies and businesses. All the terms being used are used to represent one or another form of business. Depending on the number of people involved, funding, nature of business, its shares, affiliations and partnerships, we have covered the most widely used types below with very short information about each of them.
In India following types of companies/ businesses exist
Note 2: "Inc" / Incorporated - Used in US after the name of a company organised as a legal corporation.
Note 3: LLC (Limited Liability Company) - An LLC or Limited Liability Company does not exist in India. A limited liability company (LLC) is the US-specific form of a private limited company. A limited liability company (LLC) is a hybrid legal entity that has characteristics of both a corporation and a partnership or sole proprietorship.
Please post your queries and questions below in case you face any problem or need more information on this.
In India following types of companies/ businesses exist
- Public Limited Company - Min. 3 directors and a min 7 shareholders. Is allowed to be listed on stock exchange but it is not mandatory.
- Private Limited Company - Min. of 2 directors and max. 15 directors. Privately held small business, minimum 1 and max. of 50 shareholders. Cannot trade its shares publicly on stock exchange.
- Non-Profit Organization/ Section 8 Company under Companies Act 2013/ Non profit charitable company - When a company is registered with a motive to promote a specific goal / fields such as arts, education, environmental protection etc.
- Startup - Start up is a legally recognised business. "Startup" is a label provided when a company qualifies certain set of conditions, but this term is used very loosely and interchangeably for any new business. This term was introduced to encourage entrepreneurship and help new business to grow and compete for a better market and product.
- Joint-Venture Company - A new business entity with a partnership of foreign and Indian investors. Foreign partner is able to leverage the resources, network of the Indian partner as prime advantage.
- Partnership Firm - A partnership is “the relation between people who have agreed to share the profits of the business carried on by them or any of them acting for all”. "The owners of a partnership firm are individually known as partners and collectively known as a firm " Minimum number of partners are 2. " The registration of a partnership firm is not compulsory. "
- One Person Company - New type of company introduced in India in 2013, only permitted to a resident of India. Type of private company to encourage entrepreneurship.
- Sole Proprietorship - A sole proprietorship in India is a form of a business entity where a single individual handles the entire business organization. There are less legal formalities as proprietorship does not have a legal existence.
- Non-Government Organization (NGO) - Entities which operate independently of the government. These do not work for profit making and usually working to serve some social purpose and for the benefit of the society.
Note 2: "Inc" / Incorporated - Used in US after the name of a company organised as a legal corporation.
Note 3: LLC (Limited Liability Company) - An LLC or Limited Liability Company does not exist in India. A limited liability company (LLC) is the US-specific form of a private limited company. A limited liability company (LLC) is a hybrid legal entity that has characteristics of both a corporation and a partnership or sole proprietorship.
Please post your queries and questions below in case you face any problem or need more information on this.
