I have a Colorado LLC for my consulting work. I'm thinking about starting a small coffee cart on the side. Can my existing LLC just own and operate that too, or do I need to create a new company? I'd rather not pay for another LLC filing if I can avoid it.
LLC structure
Can a Colorado LLC own a second business without creating another company?
Yes, a single LLC can generally own multi ple businesses. You'd just need to make sure your operating agreement and registration allow for it. Might need a DBA if the coffee cart has a different name.
What Lurker said., But be careful about liability mixing. If the coffee cart gets sued, your consulting assets are exposed because it's all one entity. That's the main reason people set up separate LLCs.
This^
You can also just have your LLC file a trade name (DBA) with the Colorado Secretary of State for thhe coffee cart. Cheap and easy. But yeah, liability is the big caveat.
As long as you're not trying to get a separate EIN for the coffee cart under the same LLC, you should be fine. Just use the same EIN for both. But if you want separate bank accounts, that's doable too.
Thanks, all. So it sounds like I can, but liability is the trade-off. If I do use a DBA, does that change anything about liability?
No, DBA doesn't create a seperate legal entity. It's just a name. So liability remains the same. If you want separation, you'd need a separate LLC or corporation.
I run a coffee cart under my main LLC. It's been fine for two years. Just keep good records and separate bookkeeping. But But I'm a small operation. If you're scaling, maybe a second LLC is worth it.
Also, check your insurance. Your current policy might not cover a food business. That's a bigger issue than the LLC structure.
Gravity raises a good point. My general liability didn't cover my side gig. Had to get a separate policy. Not a big deal, but don't assume.
Also, if you ever want to sell the coffee cart separately, having it under the same LLC makes that harder. Something to thi nk about.
Lots to chew on. Probably going to start with the DBA and separate insurance, then reassess if it grows. Appreciate the input.