Is it better to create a corporate bank account or use one of founders' personal bank account?

Create a corporate bank account. Please don't do an and commingle business and personal finances.Not advice. No offer. Do not rely. May lose value. Risky. Conf...

This will surely vary a lot by situation and jurisdiction, so I'll give some general thoughts and then an answer for the US, the one area I know well. In general, I have never regretted getting things formalized early, but I have definitely regretted formalizing them late. Early on in a company is a special time: everything is fresh and new, everybody is agreeable, and there are no great stressors. So all things being equal, I'd rather just sort out all the paperwork as soon as possible. Since you are already incorporated, and you're just talking about a bank account, I could see letting it slide as long as a) everybody has a fair bit of trust, b) the amount of money involved is not large, and c) the money involved is the kind of stuff that would go an expense report. E.g., Alice spent $200 on hosting; Bob spent $500 traveling to visit investors; Charlie spent $400 on a large monitor to speed up coding. Basically, if everybody's just lending bits of money to the company until some investment happens, then sure, whatever. But the moment you need to cash a check in the company's name (e.g., take an investment, receive a payment from a customer), I think you should open a bank account. I can't imagine anything more amateurish than telling an investor, "Oh, hey, could you make that check out to Bob? Because we don't actually have a bank account." h I think you should also get the bank account if one of you is putting in a significant amount of money. E.g., if one founder is investing or lending money to cover the salaries of the others, that's the kind of thing you'd want to have clear from the beginning. If you folks succeed and end up going for a significant investment round, the last thing you want during due diligence is a couple of the founders arguing over exactly who put in how much money. In the US in specific, just open the account. It will take you an hour or two tops, it won't cost much, and you'll feel properly official. You've got much bigger fish to fry; quickly nailing the basics will let you focus on what matters.

Assuming this is US, The complications with using a corporate bank account (i.e. you go down the the bank and show them the documents and maybe you may have to pay more in fees) are *NOWHERE* near as bad as the complications of paying a corporation out of a founders personal bank account.  Even if the founder is completely honest and there are no personality issues, and even if you ignore the legal liability that could result from mixing corporate and personal income, you are dead if the founder gets hit by a bus and is in the hospital for a few months.  Without a corporate bank account, you not only have to trust the founder, but also the founder's spouse and heirs.  The other thing is that if you have no corporate account, then a million alarm bells ring when an investor is doing due dillegience.

Open a credit union account (assuing you're in the US) for the company to be smart and thrifty immediately after legally forming the company and getting a http://en.wikipedia.org/wiki/Employer_Identification_Number Credit unions are not-for-profit member owned cooperatives and mine didn't charge members for business accounts when I got one for my consulting company. Membership is  restricted to some class of people although that can be quite broad - http://www.providentcu.org/index.asp?i=eligibility&search=geography which I joined after moving to Silicon Valley is open to everyone who lives or works in the SF Bay Area, LA, Sacramento, or a bunch of other big counties plus their relatives and roommates.

Specifically I regards to raising money,  I don't know any investor who would write a cheque to the founder or wire the funds to a personal account. It must be made out to the company, not the individual. Incorporate a company, assign the intellectual property and open a bank account.

This is one of the biggest mistakes I see startups make. You simply cannot use one bank account for both personal and business expenses. At best, you, and any accountant or bookkeeper you eventually bring in, for instance at tax time, will be confused. At worst, you could be sued and forced to pay additional taxes. Open a separate business account. It’s ok to transfer funds between the two, but make sure you keep the accounts and their associated expenses separate.

Hey there,I believe that it is always a good idea to separate your personal and business finances. From my own experience I know that sometimes it can be very difficult to keep it separated as there are always some sort of situations when you need to pay urgently and your business credit card is left at home making you pay from your own pocket, but let’s admit, it is just leading to mix everything and to create a headache for future when you will have to put everything back in order. So I’m convinced that keeping your company and personal finances is the best way to control the situation.There are different ways how you can separate them. One of the ways is to open up a separate bank account for your business. Reading about your situation, it seems like the necessary action you should take in order to escape future troubles with finances of you and your company. It is also a good idea to get a business expense card or a business credit card when you open up your business bank account: it will help you to keep the expenses of your company in order so you won’t need to use your personal credit card when you can’t pay in cash or by money transfer. There is a blog post that has more tips on http://blog.invoiceberry.com/2016/07/separate-business-personal-finances/, you might be interested in getting to know more information on this question.Hope I helped!Regards, Krystsina

I would be surprised if the potential investor didn't require you to open a corporate account. If only for the sake of serious appearance, have one ready before signing. Good luck.

The whole point of forming a corporation or limited liability company is to segregate liability of the business from your personal assets. You do not accomplish this if you don't have a separate financial life for the entity. So, if you want limited liability you have to open a separate account for the entity.