GmbH or AG: choose the company you can actually operate

A Swiss GmbH and an AG both separate the company from its owners, but they are not interchangeable wrappers. Start with the next two years: who will own the business, who will manage it, and will you raise outside capital? A small consulting business with two active owners may have different needs from a product company preparing several investment rounds. Compare the operating rules before treating the lower incorporation cash requirement as the deciding factor.

Compare capital with cash needs

A GmbH requires at least CHF 20,000 of share capital, fully paid in. An AG requires at least CHF 100,000 of share capital; at least 20% of each share's nominal value and at least CHF 50,000 overall must be paid in at incorporation. These are legal capital requirements, not a forecast of your launch costs. Budget separately for formation, salaries, suppliers, insurance and the months before customers pay. Unpaid AG capital also remains an obligation; it is not free financing.

Think about the people and the next transaction

The GmbH is more closely connected to its members, who are publicly recorded in the commercial register. An AG uses shares and a board structure, often familiar to investors. Neither form removes the need to organise authority, signature powers and transfers properly. Ask what happens if one founder leaves or a new investor joins. A shareholder agreement can address voting, transfers and exits, but it must fit the articles and mandatory company law rather than contradict them.

Limited liability is not a personal immunity card

The company generally answers for its debts with its assets. That does not erase a founder's personal guarantee, an unpaid capital commitment or responsibility for their own breach of duties as a director or manager. Review bank and lease guarantees separately. Example: choosing an AG does not protect you from a guarantee you personally sign for its office rent. Keep business approvals, accounts and private spending clearly separated from the first day.

Prepare the decision before visiting the notary

Write a one-page comparison of ownership, capital, expected investors, management and exit scenarios. Confirm who will satisfy Swiss representation requirements and whether an audit or an eligible opt-out is appropriate. Ask your adviser to price the complete formation and continuing administration, not only the notarisation. A useful fact: a company can be founded by one person; recruiting a nominal extra founder is not a substitute for choosing an appropriate structure. Record why the selected form fits your current plan and revisit it when that plan changes.