President of LLC: Everything You Need to Know
The President of LLC is one of the many titles you can give yourself if you are an owner of an LLC. 3 min read
President of LLC
The President of LLC is one of the many titles you can give yourself if you are an owner of an LLC. An LLC, also referred to as a limited liability company, is a popular business structure for small business owners. Unlike a corporation, the LLC doesn’t have to appoint a board of directors or hire managers. LLCs are created under state laws, which vary depending on the state in which you register. There is great flexibility in terms of the management structure of the LLC. Such owners, called members, can create their own organizational structure and give themselves titles.
Names for LLC Owners
Since the LLC business structure is very flexible, owners can use different titles. For example, if you are the head of the LLC, then you can call yourself a president or CEO. However, LLCs usually refrain from using such titles as it gives the impression that the company is a larger corporation as opposed to a smaller LLC. But for small business owners, they are usually unsure of what to call themselves.
When the LLC initially registers, the members will need to determine how the business will be managed. The members can choose to operate as either a member-managed or manager-managed LLC. If the members choose to run the LLC, then they will all be given certain duties and responsibilities to properly oversee the daily operations of the business. However, the members might want to hire a third-party manager who is responsible for such oversight. Therefore, the manager will have full oversight of the business operations while the members continue to have voting rights and authority to make major business decisions. A third option could be a multi-member LLC hiring a member to act as the manager. This person will be referred to as a member-manager.
Quite often, members often feel like employees and managers have a higher sense of power since they have management responsibilities over the business. But such terms can be confusing to others potentially doing business with your LLC. Therefore, you’ll want to be careful when choosing titles for your members.
Choosing Your Title
There are two rules to be mindful of when choosing a title for yourself or another member. First, your title should allow others to understand that you have the authority to sign contracts for the LLC. Second, your title shouldn’t be misleading. Some good titlesto choice include:
- Owner, particularly if your LLC has few members
- Managing member, for those who have managerial authority
- Principal, which is a good choice if operating a service firm
- Managing Director, creative director, or technical director, particularly for technology companies
Titles to Avoid
While there are several good choices for titles, there are also some titles that you might want to avoid. Calling yourself a managing partner, or anything with the term “partner” might allude to your LLC as a partnership, which is legally different from an LLC. This title shouldn’t be used as others might assume that you operate as a partnership, and therefore, that you don’t have liability protection. Another title to avoid is proprietor. Many single-member LLCs like to use this title, but, similar to the partnership title, a sole proprietorship doesn’t offer limited liability protection. This could cause confusion for others who might be conducting business with your LLC.
Other titles to avoid include made-up titles, i.e., head of technology. Some single-member LLC owners want to create their own title, but it is best to stick with traditional titles like CEO or president. Made-up titles don’t provide any understanding to outsiders. Therefore, some suppliers and vendors might not want to do business with you if they are unsure of your position with the business.
You should also avoid humorous titles, i.e., head honcho in charge or leader of the world, as this could actually reduce your customer-base. While some younger customers might appreciate the humor, most other customers won’t want to do business with you, particularly if the contract involves a significant amount of money.
If you need help thinking of titles for the members of your LLC or if you are unsure of what to call yourself for your single-member LLC, you can post your legal need on UpCounsel’s marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.