A Limited Liability Company in which all owners, called members, are directly involved in running the day-to-day operations and making business decisions.
What is a Member-Managed LLC?
In a member-managed LLC, the members actively participate in managing the business. Each member has the authority to make decisions, sign contracts, and act on behalf of the company unless otherwise limited in the operating agreement. This structure is the default management style in most states unless the LLC’s formation documents specify a manager-managed structure.
A member-managed LLC is often preferred for small businesses with a few owners who want to be directly involved in operations and decision-making. It allows for a more hands-on approach and avoids the need to appoint separate managers.
The operating agreement typically outlines each member’s roles, responsibilities, and decision-making powers, as well as how profits and losses are distributed. For non-U.S. owners, a member-managed structure may require more direct involvement and can be less practical if they are not physically in the U.S., unless operational tasks are delegated to employees or contractors.
