Why is a Delaware incorporation better for startups?

Delaware is, oddly, at the forefront of business law. As such, they are more progressive and their laws tend to be uniformly regarded as more in tune with certain protections. It would take more time than I can type to compare and contrast Delaware with other state business law. Delaware therefore provides a sense of uniformity and the most rigorous protections. That, in turn, provides more transparency and reduces the appearance of risk in acquisition -- the purchasers can more readily ascertain the business structure, for example, and be able to hold people accountable accordingly.

A different strategy is advisable if you prefer to be incorporated locally and are doing business in a single state, e.g. You would want to look at the protections offered and tailor your articles of incorporation or Operating Agreement to address any issues you anticipate arising in the local courts.