Delaware's registry recorded 334,461 new business entity formations in 2025. In 2024 it recorded 289,810, and in 2023 it recorded 298,165.
For two years the story told about Delaware has been one of departure: companies reincorporating elsewhere, a body of case law that founders had stopped trusting, and rival states advertising for the business. The registry is the one count that settles whether the state lost volume. It did not.
The number that went the other way
More than 2.28 million entities are now registered in Delaware. Over two-thirds of the Fortune 500 are incorporated there. Of the initial public offerings by US-based companies last year, the state puts its share at nearly 70 percent.
Those are the figures the Division of Corporations publishes about itself, which is worth saying plainly: this is the incumbent's own scoreboard, and an incumbent chooses which numbers to keep. They are still the only complete count of what was filed, and what was filed went up by about 15 percent in a year when the state was widely described as losing its franchise.
What a formation count can and cannot tell you
Here is the part that both sides of the argument tend to skip. A formation is a filing. Most of the 334,461 are limited liability companies — holding vehicles, fund entities, single-purpose subsidiaries, the ordinary plumbing of American business.
The contested question was never the plumbing. It was where large public companies choose to charter, because that choice decides which court hears a dispute between a controller and everyone else. A registry counts filings, not consequence.
So the count rebuts the strong version of the claim — that Delaware was emptying out — and leaves the narrow version standing. Both things can be true, and the state's behaviour suggests it thought the narrow version mattered.
Delaware moved anyway
In 2025 the General Assembly amended Section 144 of the General Corporation Law. The amendment, recorded in the code as 85 Del. Laws, c. 6, rewrote how transactions involving a controlling stockholder are reviewed.
Under the amended section, such a transaction is protected from equitable relief or damages if it clears one of three routes: approval by a majority of disinterested directors on a committee expressly empowered to negotiate and to reject it, approval conditioned on ratification by disinterested stockholders, or a showing that it is fair to the corporation and its stockholders.
The section also fixes who counts. A controlling stockholder is one holding a majority in voting power, or holding contractual rights to elect a majority of directors, or holding at least a third of the voting power together with managerial authority. And it limits what a controller can be made to pay: no monetary damages except for breach of the duty of loyalty, acts not in good faith or involving intentional misconduct, or a transaction producing an improper personal benefit.
A legislature amending its corporation law is telling you something
States do not rewrite the review standard for controller transactions casually. Delaware's corporate code is its product, and the 2025 amendment moved that product toward predictability for the people who control companies.
That is a competitive act, and it is legible as one whether or not any particular company had already left. It is also the same manoeuvre this desk has described in other settings, where the structure of a deal is chosen to determine who gets to examine it. Charter choice is structuring by another name, performed once, at the beginning, for everything that follows.
The venue that is actually being built
Texas now runs a business court, created by House Bill 19 of the 88th Legislature and extended by House Bill 40 and Senate Bill 29 of the 89th. Five of its eleven authorised divisions are sitting — Dallas, Austin, San Antonio, Fort Worth and Houston — and its administrative presiding judges serve two-year terms under Section 25A.009(d) of the Government Code.
Five divisions is not a rival to a court with a century of precedent behind it. It is, however, a standing offer, and standing offers work slowly. The relevant comparison is not this year's filings but whether a body of decided cases accumulates that a general counsel can rely on.
What to watch
The 2026 formation count, and specifically whether the 15 percent rise repeats or reverses. One year is a data point; two is a direction.
Then the first substantial controller case decided under the amended Section 144. The statute now describes the safe harbours in terms a board can plan around. What matters is how a court reads them the first time a controller invokes one and a stockholder says it was not earned.
The formation counts for 2023 (298,165), 2024 (289,810) and 2025 (334,461), the figure of more than 2.28 million registered entities, the statement that over two-thirds of the Fortune 500 are incorporated in Delaware and that nearly 70 percent of US-based initial public offerings in 2025 chose the state are published by the Delaware Division of Corporations. The provisions of Section 144 of the Delaware General Corporation Law quoted here, including the committee and disinterested-stockholder safe harbours at subsection (b), the definition of a controlling stockholder at subsection (e)(2) and the limitation on monetary damages at subsection (d)(5), are from the current text of Title 8 of the Delaware Code, which records the section as amended by 85 Del. Laws, c. 6, section 1. The Texas Business Court divisions now sitting, the bills that created the court and the two-year terms of its administrative presiding judges under Texas Government Code section 25A.009(d) are from the Office of Court Administration. We were unable to retrieve Delaware's franchise tax revenue figures from the state's published fiscal documents and have made no claim about them. The analysis is our own.
Topics businessgovernance
