Nearly 1.5m companies are incorporated in Delaware. How did this tiny state become a mecca for corporate activity?

Take a look at any given corporation’s registration docs, and there’s a good shot you’ll see the address 1209 North Orange Street.

Spanning less than a city block in Wilmington, Delaware, this nondescript office building is the official incorporation address of 285k+ companies from all over the world.

On the surface, there’s no reason that Delaware — home to blue hens and Civil War monuments — should be a corporate paradise. It’s the second smallest state in America, and the 6th least populous, with just 986k residents.

Yet, nearly 1.5m businesses from all over the world are incorporated there, including 68% of all Fortune 500 firms.

The Delaware Loophole and how it works