Delaware and Wyoming are the two most-asked-about US LLC states among non-US founders, and they serve completely different kinds of businesses. This guide compares them on the dimensions that actually matter (cost, privacy, investor optics, ongoing maintenance, banking, and reputation) and gives you a clear answer for which one fits your specific situation.
The short version: choose Delaware if you plan to raise US venture capital from institutional investors. Choose Wyoming for almost everything else. The longer version follows.
The 30-second answer
QUICK DECISION GUIDE
Choose Delaware if: You plan to raise US institutional venture capital, sign enterprise contracts with Fortune 500 clients, or want to be acquired by a US public company. Delaware is the legal gold standard for these scenarios.
Choose Wyoming if: You're a consultant, freelancer, agency, e-commerce seller, content creator, or bootstrapped SaaS founder. Wyoming is cheaper, more private, and fully sufficient for these businesses.
Cost comparison: filing fees and annual maintenance
Wyoming is meaningfully cheaper across the board. Here's the side-by-side over a five-year period:
| Cost item | Delaware | Wyoming | Difference |
|---|---|---|---|
| State filing fee (one-time) | $110 | $100 | $10 |
| Year 1 franchise tax / annual report | $300 | $60 | $240 |
| Years 2-5 (per year) | $300 | $60 | $240/yr |
| Registered agent (per year) | $100-300 | $100-300 | $0 |
| 5-year total (excluding RA) | $1,610 | $400 | $1,210 |
For a bootstrapped founder, $1,210 over five years is meaningful. For a venture-backed startup raising $5M, it's a rounding error. The cost difference is only relevant if you're cost-sensitive, which most founders pre-revenue are.
Privacy laws
Both states are reasonably private compared to most US states, but they differ in degree.
Wyoming doesn't require LLC members or managers to be listed on the formation documents that become public record. Your name doesn't appear in any state-public database. The annual report does require the registered agent's name, but not the owner's.
Delaware doesn't require members on the Articles of Organisation either, but the Delaware Division of Corporations annual filings can include officer information. There's also Delaware's "Authorised Persons" disclosure requirement that's slightly more public than Wyoming's framework.
For most founders, the difference is small in practice. Both states provide strong privacy compared to California (which makes everything public) or Texas (which requires Public Information Reports).
Investor and customer optics
This is where Delaware's reputation matters most. About 67% of Fortune 500 companies and over 80% of US-listed IPOs are Delaware entities. Among US institutional venture capital firms, Delaware C-corp is the assumed default. If you're a Wyoming LLC and you raise a Series A, your investors will almost certainly require you to convert to a Delaware C-corp before they wire the funds.
For founders not raising US institutional capital, this matters very little:
- US customers don't check your LLC's state of formation before buying SaaS or e-commerce products.
- US contractors and freelancers don't care whether you're Wyoming or Delaware.
- Smaller US businesses signing routine contracts also don't care.
- Bootstrapped founders raising angel money from friends and family don't need Delaware.
The reputational benefit of Delaware is highly specific to a single audience: US institutional VC investors. If that's your audience, pay the premium. If not, save the money.
Legal infrastructure and dispute handling
Delaware has the Court of Chancery, a specialised business court that has been hearing corporate disputes since 1792. The depth of case law is extraordinary. Virtually any imaginable corporate scenario has been litigated and decided in Delaware. This certainty is why sophisticated commercial contracts often specify Delaware governing law.
Wyoming's commercial legal infrastructure is much smaller but adequate for most situations. Wyoming was actually the first state to recognise the LLC structure (1977), so its LLC case law is mature even if its overall corporate case law isn't as deep as Delaware's.
For non-US founders running small or mid-sized businesses, you're unlikely to be involved in major US corporate litigation. The legal infrastructure difference matters most for:
- Companies expecting major M&A activity
- Multi-party joint ventures with US corporations
- Public-company subsidiaries
- Companies with complex shareholder agreements involving US institutional investors
For SaaS, e-commerce, agency, or freelance work, you'll rarely encounter scenarios where Delaware's legal depth matters.
Banking and payment processor acceptance
Both states are equally accepted by all major US banks and payment processors that work with non-US founders. Mercury, Wise, and Relay all onboard Wyoming LLCs at the same rate as Delaware LLCs. Stripe, PayPal, and Amazon Seller Central treat them identically. There's no banking advantage to Delaware over Wyoming.
Recommendation by business type
| Business type | Recommendation | Reasoning |
|---|---|---|
| Bootstrapped SaaS | Wyoming | Lower cost, no investor pressure |
| VC-track SaaS | Delaware | Investors will require it eventually anyway |
| Agency / consulting | Wyoming | Lower overhead, privacy, sufficient for service businesses |
| E-commerce / DTC | Wyoming or Florida | Wyoming for cost; Florida for stronger commercial reputation |
| Freelance / solo | Wyoming or New Mexico | Both maximise privacy and minimise cost |
| Real estate holding | Wyoming | Strong asset protection laws |
| Holding company | Delaware | Sophisticated entity structure handling |
| Content creator / digital products | Wyoming | Cost matters, audience doesn't care about state |
Bottom line
Most non-US founders forming a US LLC don't need Delaware. They've heard the name in the context of "Stripe Atlas defaults to Delaware" or "Y Combinator companies are in Delaware" and assumed it's the right answer for them too. It usually isn't.
If you're a SaaS founder planning to raise US Series A capital, or you have specific contractual or M&A considerations that point to Delaware, choose Delaware. Otherwise, Wyoming saves you $1,200+ over five years, gives you slightly better privacy, and has zero practical downsides for service businesses, e-commerce, freelance work, and bootstrapped SaaS.
If you genuinely don't know whether VC fundraising is in your future, default to Wyoming. The conversion cost from Wyoming to Delaware (around $1,000-$2,000) is much lower than the Delaware franchise tax you'd save in the meantime if you end up not raising.
Frequently asked questions
Which is cheaper, Delaware or Wyoming?
Wyoming is significantly cheaper. Wyoming costs about $160 in year one ($100 filing + $60 annual report) and $60/year ongoing. Delaware costs about $410 in year one ($110 filing + $300 franchise tax) and $300/year ongoing. Over five years, Delaware costs roughly $1,500 more than Wyoming. For bootstrapped founders with no specific reason to be in Delaware, Wyoming saves meaningful money.
Do investors prefer Delaware over Wyoming?
Yes, but only for venture-capital-backed startups planning Series A and beyond. US institutional investors expect Delaware C-corp structures, and the Delaware Court of Chancery's 230 years of business case law makes it the legal default for major M&A transactions. For consulting, e-commerce, freelance, or bootstrapped businesses that won't raise US institutional capital, investor preference is irrelevant. Wyoming works fine.
Is Wyoming actually more private than Delaware?
Yes, modestly. Wyoming does not require LLC member names on the public formation filing, so your name doesn't appear in the state's public records. Delaware also doesn't require member disclosure on the Articles of Organisation, but it does require it on the annual franchise tax filing. Both states are private compared to states like California or Texas. For maximum privacy, New Mexico is even better than either.
Can I move my LLC from Delaware to Wyoming later (or vice versa)?
Yes, but it's expensive and creates compliance complexity. The process is called domestication or conversion. Costs roughly $500-$2,000 in filing fees plus legal advice. You'll need to update all your bank accounts, payment processors, contracts, and tax records to reflect the new state. The right move is to pick the right state at the start. If your circumstances change dramatically (e.g., you decide to raise venture capital), conversion to Delaware is straightforward.
Does it matter where I'm physically located if my LLC is in Delaware or Wyoming?
Generally no. As an non-US resident running the business from outside the US, you're not creating nexus in any specific US state. Choose based on the LLC's regulatory and reputational fit, not based on a US state where you might travel. The exception: if you have employees or physical operations in a specific US state (warehouse, office), that state may require you to register as a foreign LLC there in addition to your formation state.
Is there any downside to a Wyoming LLC for an non-US founder?
Only one significant one: investor optics for VC fundraising. Some institutional investors will require you to convert to a Delaware C-corp before investing. If that's likely in your future, starting in Delaware avoids the conversion friction. Other than that, Wyoming has no meaningful downsides. Banks accept it, Stripe accepts it, customers don't care, and the tax treatment is identical to Delaware.
What if I'm not sure whether I'll raise VC capital later?
Default to Wyoming. If you end up raising VC, conversion to Delaware costs $500-$1,500 and takes 2-4 weeks. If you stay bootstrapped (which is statistically likely for most founders), you'll save $1,500+ over five years in Delaware franchise taxes you didn't need to pay. The expected value strongly favours Wyoming for the uncertain case.
Editorial integrity: This article was written by the PowerLaunch editorial team and reviewed for technical accuracy by a US tax professional. Tax and corporate law change frequently. This article reflects guidance as of May 2026. Always consult a qualified professional for your specific situation.
