I. Andreessen Horowitz’s Move to Nevada from Delaware Stirs the Incorporation Debate
On July 9, 2025, venture capital firm Andreessen Horowitz (a16z) announced that it has officially moved its corporate domicile and primary incorporation jurisdiction to Nevada. In their piece entitled “We’re Leaving Delaware, And We Think You Should Consider Leaving Too“, a16z cited Nevada’s strong statutory protections for directors and officers, its predictable and business-friendly legal environment, and its ongoing development of a statewide business court structure. The firm emphasized that Nevada’s framework better aligns with the needs of innovative companies and offers greater legal clarity and risk insulation compared to Delaware, where recent court decisions have, in their view, eroded board autonomy and weakened director independence. They cited concerns about judicial efforts to limit a corporation’s ability to exit the state—developments that have unsettled many startup founders and investors.
The announcement urged startups and entrepreneurs to seriously consider Nevada as a modern, pro-innovation jurisdiction. Given Andreessen Horowitz’s role as a trend-setting powerhouse in fintech, AI, and emerging areas like gaming, this move will likely be viewed in hindsight as a watershed moment—one that reshaped the mindset of business founders and leaders regarding where to incorporate and build enduring companies. It also put a spotlight on jurisdictions like Nevada and Utah, each of which is developing modern legal and policy frameworks that aim to compete directly with Delaware and appeal to innovation-driven businesses.
The decision also invites a broader reconsideration of how incorporation jurisdictions are chosen. Among the most closely watched alternative jurisdictions are Nevada and Utah. Both states are actively refining their legal and economic frameworks to attract high-growth and innovation-driven companies. While Nevada is often recognized for its tax neutrality and longstanding director protections, Utah is emerging as a serious competitor with a statewide business court, strong public investment in startups, and a thriving tech ecosystem.
Startups and scale-ups must consider more than just court structures and statutory language. They must also weigh tax burdens, regulatory environments, investor expectations, talent pipelines, and the availability of industry-specific incentives. This essay examines the legal infrastructure (Section II), tax and economic development policies (Section III), strategic fit for different business models (Section IV), and quality of life and talent factors (Section V) to help founders and stakeholders make informed jurisdictional decisions.
II. Nevada vs. Utah: A Comparative Legal Framework
Startups looking to incorporate outside of Delaware are often drawn to Nevada or, more recently, Utah. The table below provides a high-level comparison of legal structures and governance tools in Nevada and Utah. While useful as a snapshot, this summary omits certain recent developments that may be highly relevant depending on the company’s needs. More detailed commentary on each jurisdiction follows the table. Utah’s new Business and Chancery Court, launched in 2024, positions the state as a modern competitor. Below is a side-by-side comparison of key legal and business factors relevant to founders and investors.
| Feature | Nevada (Business Court) | Utah (Business & Chancery Court) |
| 1. Court Structure and Venue | Limited to Clark County (Las Vegas) and Washoe County (Reno); business court dockets within general jurisdiction courts. | Statewide jurisdiction; business court division of Utah District Courts; headquartered in Salt Lake City but accessible from any county. |
| 2. Business Judgment Rule | Codified at NRS §78.138; very strong protections favoring directors/officers absent fraud or knowing misconduct. | Codified at Utah Code §16-10a-840; directors protected if acting in good faith, informed, and with rational belief. |
| 3. Jury Trial Waiver | Parties generally retain right to jury trial unless waived; business court does not eliminate jury trials. | Plaintiff waives by filing in chancery court; defendants may demand timely; jury-eligible issues are transferred to general district court. |
| 4. Judge Selection | Assigned judges within existing judicial districts; no separate appointment or training specific to business law. | Designated from existing Utah District Court judges with business law experience; appointed and trained specifically for this docket. |
| 5. Director/Officer Liability Limits | Nationally recognized as most protective; liability almost entirely eliminated by statute unless for intentional misconduct or fraud. | Strong statutory protections; liability limited by statute and corporate charter; case law still developing. |
| 6. Shareholder Inspection Rights | Under NRS §78.257, shareholders can inspect books/records if they own at least 15% of outstanding shares or have court approval. | Governed by Utah Code §16-10a-1602; allows inspection for proper purpose with procedural safeguards. |
| 7. Startup Ecosystem & Investment | Reno and Las Vegas see tech growth (e.g., Tesla), but fewer high-growth software startups or VC-backed tech firms. | “Silicon Slopes” region in Utah is a nationally ranked startup hub; strong VC presence; over $100M public support via USTAR. |
| 8. Broader Considerations | Nevada offers tax advantages (no corporate income tax), but has higher legal gambling and vice industry exposure; less startup infrastructure. | Utah ranks high for education, infrastructure, family-friendliness, and moderate politics; growing population of tech workers. |
Nevada-Specific Legal Considerations
Although Nevada does not yet have a formal statewide business court, it maintains specialized business court dockets within its district courts in Clark County (Las Vegas) and Washoe County (Reno). As of 2025, a proposed constitutional amendment (AJR 8) aims to create a centralized statewide business court with appointed judges—a move widely seen as a direct response to Delaware’s recent judicial controversies. If approved, the court would have exclusive jurisdiction over complex business disputes and judges would be selected by the Governor from a commission-approved list.
Nevada also codifies strong protections for directors and officers under NRS §78.138, providing near-complete liability shields absent fraud or knowing misconduct. Legislation adopted in 2025 (AB 239) further clarified that jury trials in internal corporate disputes may be waived through a company’s charter, strengthening Nevada’s appeal for companies that prefer judicial resolution over juries.
Utah-Specific Legal Considerations
Utah’s Business and Chancery Court, launched in 2024, represents a statewide judicial structure within the district court system. It accepts qualifying business cases from any county and assigns them to designated judges trained in commercial law. Unlike Nevada, Utah’s court system has no pending structural reforms—its model is already integrated and active. Additionally, Utah’s tax policies and formal recognition of cryptocurrency as a legal form of payment have made it increasingly attractive to startups in this sector.
Utah codifies its business judgment rule in §16-10a-840 of the Utah Code, which offers protection to directors who act in good faith, with reasonable care, and in the best interests of the corporation. Jury trials are generally waived upon filing in the Chancery Court, though defendants can preserve the right if they demand it in a timely manner. If invoked, the jury-triable issues are transferred to general district court.
III. Tax and Incentive Considerations: Nevada vs. Utah
Startups and scaling businesses must weigh both tax structure and the availability of economic development programs when selecting a jurisdiction. Nevada and Utah reflect two very different models: Nevada emphasizes broad tax neutrality and flexible industry-focused incentives, while Utah pairs modest taxes with proactive, sector-specific support for innovation-led enterprises. The table below summarizes their core tax features:
| Category | Nevada | Utah |
| Corporate Income Tax | None | 4.65% flat on net income (2025) |
| Personal Income Tax | None | 4.65% flat on personal income |
| Gross Receipts/Commerce Tax | Commerce Tax on gross revenue over $4M (e.g., ~0.111% for tech firms) | None |
| Sales Tax (state + local) | ~8.23% average (state 6.85%) | ~7.19% average (state 4.85%) |
| Property Tax (effective) | ~0.55% | ~0.58% |
| Unemployment Insurance | 0.25–5.4% on first $40,100 | 0.2–7.4% on first $44,400 |
| Annual Business Fees | ~$650/year for corporations | ~$22–100/year depending on entity type |
Economic Development & Innovation Incentives
Nevada offers a zero corporate and personal income tax environment, supported by additional abatements on Commerce and Modified Business Taxes for qualifying businesses. The state has focused its economic development strategy around key industries such as aviation, logistics, advanced manufacturing, and hospitality technology. Notable programs include the Knowledge Fund, which has deployed approximately $37 million to support commercialization of university research, and UNLV’s Black Fire Innovation Fund, which accelerates gaming and hospitality tech ventures. Additionally, Nevada’s recent federal tech hub designation has brought new investment in lithium battery and clean manufacturing initiatives, particularly around Reno and Las Vegas.
Utah, meanwhile, provides a more targeted incentive framework for innovation-led startups. The USTAR program has supported university-affiliated startups and research commercialization with over $123 million in follow-on funding. The Economic Development Tax Increment Financing (EDTIF) program provides state tax credits to companies creating high-paying jobs and capital investment. Utah also offers industry-specific benefits through programs like the Alternative Energy Development Incentive (AEDI), as well as commercial tax credits for renewable energy projects, which were expanded in 2025. These tools are especially supportive of companies operating in fintech, artificial intelligence, biotechnology, and clean energy. Utah has also distinguished itself in the blockchain and digital asset space. Through amendments to its Money Transmitter Act, Utah offers greater regulatory clarity to noncustodial blockchain companies by reducing licensing burdens.
IV. Strategic Jurisdictional Considerations: Nevada vs. Utah
Nevada remains attractive for businesses prioritizing a zero-income tax environment and those operating in logistics, gaming, or capital-light service models. Its legal and regulatory simplicity, coupled with strong director protections, continue to make it a compelling choice for companies focused on lean governance and operational efficiency.
Utah, meanwhile, offers a well-rounded platform for startups in high-growth, innovation-led industries. Its reasonable tax policy, sector-specific incentives, and evolving legal infrastructure—including the new Business and Chancery Court—position it as an increasingly competitive jurisdiction for founder-led and venture-backed companies.
V. Quality of Life & Talent Considerations: Nevada vs. Utah
While legal structure and financial incentives are critical to jurisdictional decisions, a company’s ability to attract and retain top talent also hinges on broader quality of life factors. Executives, technical talent, and remote workers increasingly consider cost of living, public safety, education, healthcare access, and environmental quality when choosing where to work and live. These elements directly impact a startup’s culture, morale, and long-term operational footprint.
| Metric | Utah | Nevada |
| Cost of Living | Lower than national average (outside Salt Lake metro) | Generally low, but higher in Las Vegas metro and resort-heavy areas |
| Housing Affordability | More stable housing market; lower median home prices in most metros | Hotter markets in Las Vegas/Reno; affordability varies sharply |
| Public Safety | Lower violent and property crime rates statewide | Higher crime, especially in Las Vegas and urban corridors |
| K–12 Education | Higher ranked; strong public schools in suburban areas | Generally ranked lower; some urban school districts underperform |
| Higher Education | University of Utah, BYU, Utah State—all nationally ranked | UNLV and UNR strong in hospitality and STEM; fewer nationally ranked |
| Healthcare Access & Quality | Good access, especially along Wasatch Front; ranked in top third nationally | Good urban care; rural access challenges; some large providers |
| Commute Times / Transportation | Moderate commutes; expanding rail/light rail in Salt Lake metro | Higher traffic in Las Vegas; public transit less developed |
| Recreation & Outdoors | World-class skiing, hiking, parks; high outdoor lifestyle appeal | Great desert/mountain recreation near Reno/Tahoe; less green space in Vegas |
| Cultural Amenities | Growing arts/food scene; conservative social climate | More diverse nightlife and entertainment, especially in Las Vegas |
| Political/Social Climate | Center-right, family-focused, strong community values | Libertarian-leaning; more permissive socially and economically |
VI. Conclusion
Nevada and Utah both offer compelling alternatives. Nevada appeals to businesses seeking maximum statutory insulation, zero income taxes, and a regulatory climate well-suited to gaming, hospitality, and capital-light service models. Its business-friendly policies and maturing court infrastructure make it an increasingly credible choice—particularly for founders prioritizing simplicity and legal predictability.
Utah, by contrast, presents a more holistic ecosystem for innovation-led companies. Its new Business and Chancery Court delivers modern legal infrastructure, while its tax policy, targeted incentives, and sector-specific programs strongly support high-growth fields like fintech, AI, biotech, and renewable energy. Beyond legal and economic factors, Utah also benefits from a young, educated population, family-friendly environment, and strong quality-of-life fundamentals—all of which support long-term workforce stability.
Ultimately, the right choice depends on the company’s industry, investor base, and operational needs. For founders focused on rapid growth in emerging tech sectors, Utah offers an increasingly competitive—and in some cases (e.g. fintech, AI, biotech, and renewable energy) superior—platform. For those prioritizing tax neutrality, director protections, and lean operations, Nevada remains a strong contender.
Disclaimer
This document is for informational purposes only and does not constitute legal, tax, or financial advice. The information provided is general in nature and may not reflect current developments in law or policy. Readers should consult qualified legal and tax professionals before making any decisions based on the contents of this publication. No attorney-client relationship is created by reading or relying on this document.The July 2025 announcement by Andreessen Horowitz to relocate to Nevada has sparked a broader reassessment of where companies—particularly in tech, fintech, and emerging sectors—should incorporate. Their move reflects growing concerns with Delaware’s legal climate and highlights the need to align jurisdictional choices with a company’s risk profile, growth model, and investor expectations.
