Influencers have exploded on the scene lately. Influencers are the new bloggers except they don’t have blogs. They have a social media channel where they post content. Influencers need to incorporate their brands to protect themselves legally and financially. It’s how influencers take their game to the next level.
It’s one of the most superficial and narcissistic things I’ve witnessed since the AOL dial-up days. However, it’s big business. There are even college classes on how to become an influencer. If colleges are teaching courses on it, it’s definitely something to take seriously. Most influencers aren’t business savvy and never worked in corporate America. They’re good at creating content and whether they can monetize the content is another topic.
Influencers find creative ways to get eyes on their content. It could be Instagram Pods or bot usage. Companies and brands only care about numbers – engagement and followers. However, major influencers have large followings but their engagement is a lot lower. Micro-influencers have less followers but they’re engagement is higher. This is mainly because a lot of micro-influencers are participants in Instagram Pods. It’s artificial engagement. Macro-influencers fall into the middle of the two.
Influencers need to start taking their brands a lot more seriously. They need to step back and get some business advice – financial and legal. They need to start thinking about how to protect their brand. The FTC has stepped in and started to regulate influencers. They fine a few YouTube stars for not disclosing their relationship with advertisers. In other words, it’s time to move from hobbyist to professional.
Most influencers do what they do, so they don’t have to get a “real” job. However they need to grow up a little bit and start thinking about it as a business. Jay Z has a perfect line for this, which is “I’m not a businessman. I’m a business, man.” Now, take a second to think about that line.
Influencers’ social media channels are their store front and they are their products. It’s a business. With any business, there is always a liability issue whether intentional or not. There’s the FTC issue previously mentioned, fraud issues, copyright, false advertising, and etc.
For example, the Fyre Festival was a disaster and it was heavily promoted by major influencers. Fuck Jerry was behind the marketing efforts. When the ship started to sink, influencers started to delete their posts promoting the event. I seriously don’t know why those influencers thought deleting a post would save them from screenshots. There are some legal ramifications for their actions. Ja Rule and team is currently being investigated for their failure to deliver as promised.
Anyway, as mentioned, influencers need to protect themselves from legal action whether they’re sued by a company/brand or being investigated by the government. All influencers are operating as individuals (1040-A tax returns) right now and any money they get is being paid directly to them. I highly doubt they are even operating as DBAs (i.e., Doing Business As). This leaves them financially and legally liable for any problems that may occur with their social media accounts, which includes anything related to false advertisements and not disclosing their relationship with the company.
- C Corp
- S Corp
- Limited Liability Company (i.e., LLC)
Here is a comparison table for the three types:
Provided by www.incorporate.com.
Here are quick LLC vs Corporation advantages and disadvantages:
Here are some quick tax benefits between the three:
There is one thing everyone should know about incorporation documents. It’s all based off of pre-made templates and lawyers change verbage to suit their client. In other words, you’re paying a lot of money for frozen fries that’s being recooked. I would never suggest spending large amounts of money to file Articles of Incorporation especially when you’re first starting off. Your company will change and the Articles of Incorporation should change to match your needs.
This is where Incorporate.com comes in. They offer economically sound solutions for influencers with a budget. They’re filing starts at $79. That’s dirt cheap for legal work. It’s dirt cheap because they know Articles of Incorporation are built off of templates that have been passed on from law firm to law firm. In addition, they know most of the leg work is done by paralegals. Check them out here for all your incorporation needs and take your influencer brand from amateur to professional. They service all 50 states and the process takes less than 10 minutes. To begin, click here.
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