Elon Musk called on corporations to ditch Delaware. They didn't listen.

Despite high-profile calls for corporations to leave Delaware, the state continues to thrive as a leading hub for business registrations. Notably, billionaire Elon Musk, who previously had his companies incorporated there, criticized Delaware's legal landscape on social media in 2024, suggesting that companies should abandon the state. However, rather than seeing a decline, Delaware has experienced a significant surge in new corporate formations. According to Andrew Verstein, author of the Corporate Census, 2025 has marked an unprecedented growth period for Delaware, with a notable increase of around 30% in new corporations compared to the previous year. Musk's departure of Tesla and SpaceX from Delaware followed a legal dispute over his substantial compensation package, which he argued was unjustly voided by the state's courts. His criticism resonated with other CEOs, including those from the venture capital firm Andreessen Horowitz and the cryptocurrency exchange Coinbase, who also considered moving due to perceived uncertainties in the state's legal system. The phenomenon, dubbed 'Dexit'—a combination of 'Delaware' and 'exit'—was anticipated to reflect a widespread corporate exodus. Yet, contrary to this narrative, Verstein's research indicates that Delaware has not only retained its corporate presence but has also reinforced its status as a premier destination for new business registrations. Verstein pointed out that the increase in incorporations is not merely a result of companies leaving other states but rather a robust influx of new businesses choosing Delaware. Factors contributing to this growth may include recent legislative changes aimed at enhancing corporate governance and addressing concerns raised by Musk and others. Additionally, external factors, such as the political climate following the election of President Donald Trump, may have also encouraged corporations to seek the advantages of incorporating in Delaware. In response to the discussions around 'Dexit,' Delaware officials remain confident in the state's appeal. A spokesperson for the Secretary of State stated that Delaware's corporate franchise remains strong, emphasizing the state's unmatched expertise in corporate governance. Secretary of State Charuni Patibanda-Sanchez reiterated that Delaware's position as a corporate leader is not under significant threat, despite ongoing competition from other states seeking to attract businesses.