LLC Operating Agreements: Key Considerations for New Business Owners
When you start an LLC , it’s easy to focus on branding, clients, and your product—but without a proper operating agreement, you’re risking unnecessary conflict down the line. Even in states where it’s not required, this document is your safeguard. It lays out how your business will run, who makes decisions, and how money flows in and out. Whether you’re a solo entrepreneur or working with partners, your operating agreement defines your authority, protects your interests, and keeps everything clean and enforceable. This guide walks you through what you need to cover, why each part matters, and how to make sure your agreement fits your business from day one. Ownership and Member Roles You need to spell out who owns what. The operating agreement should list every member, their ownership percentage, and their initial capital contributions. Whether each person brought in cash, equipment, or intellectual property, it needs to be recorded clearly. This not only avoids disputes but gives clari...