Why does every LLC need an Operating Agreement?
Protecting yourself and your business is very important and should not be taken for granted. Members of The Mom Entrepreneur Online Support Group share their stories about running their business on a regular basis (e.g. trademark infringement and partnerships gone badly).
My company Bisson Barcelona, LLC was once a partnership with a very loose agreement drawn up by a lawyer. Unfortunately, the LLC was formed after we split. Having this document in place prior to forming this partnership would have helped settle many disputed that arose over the course of the partnership. Forming an LLC is well worth the time and effort to ensure you are protected.
Adam Bergman, Esq., president of myLLCagreement.com continues to answer our questions this week about why every LLC also needs an Operating Agreement.
TME: Why should every Single Member LLC (1 owner) owner have an Operating Agreement?
Adam: It is extremely important that you create an Operating Agreement to separate yourself as an individual from your LLC, even if you are the sole owner of your LLC. Without the formality of an Operating Agreement, the LLC can closely resemble a sole proprietorship, which does not limit your personal liability for business debts of the LLC. Without an LLC Operating Agreement, the basic operation of the LLC would then be governed by state law, which may not be advantageous to the LLC, it members, or the business it conducts.
TME: Why should every Multi-Member LLC (more than one owner) have an Operating Agreement?
Adam: The Operating Agreement governs the operation and management of the LLC. It describes the business and economic arrangement of the members (partners). LLCs need to document important and material issues that could impact the members, such as profit-sharing and decision-making rules as well as their procedures for handling the departure/addition of members, and the dissolution/termination of the LLC.
Without an Operating Agreement, the owners will be poorly-equipped to settle misunderstandings over the operations, finances, and management of the LLC. In addition, without an Operating Agreement, the LLC will be subject to the default operating rules created by state law.
The LLC Operating Agreement generally specifies, among other things, the business name, the official business address, the identities of the members, the way in which cash is distributed to the members, the way in which profits and losses are to be divided between the members, and how the company will be managed. The Operating Agreement should also reflect each member’s financial contributions to the LLC and the member’s ownership interests.
Thanks Adam! Don't forget about our contest, which continues until October 31st. MyLLCagreement is sponsoring a giveaway to win an LLC formation, an LLC Operating Agreement and $500 for your business!
Also, on Thursday, October 22nd, The Mom Entrepreneur will host a complimentary teleseminar with Adam: Protecting Yourself in Business - Why Every LLC Needs an Operating Agreement. You must register to be on the call.
About Adam Bergman:
Adam is the president and creator of myLLCagreement.com, the leading online provider of customized LLC Operating Agreements. He has worked as a corporate and tax attorney at White & Case LLP, Dewey LeBoeuf LLP, and Thelen LLP, three of the most prominent law firms in the United States where he advised thousands of entrepreneurs and business owners on a wide range of corporate and tax issues involving limited liability companies for the past seven years. Adam is recognized as a leading partnership tax expert and has lectured attorneys on the taxation of LLCs.
Work-at-home moms do you feel isolated?

The answer....a resounding NEVER!
She was worried that I was too isolated working at home, by myself with no adult interaction. I attempted to explain that I have lots of adult interaction online and offline. I love it this way!
When I started my business in 2000, I worked at home. Alone. I had previously been working for a company with several other employees and I enjoyed the interaction. But I did not enjoy the insecurity of working for someone else; someone who did not respect his employees and whose business was failing.
It was hard being alone at home as a new mom. My son was less than a year old and entrepreneurship and motherhood were both very new to me.
I was lonely. I desperately wanted to interact with other women who were experiencing something similar. I searched...but could not find anyone.
My business quickly grew, I added six employees, and I moved my office out of the house and into a traditional office setting.
Within two years I was miserable.
Coming back home to work for myself was one of the best business decisions I have ever made.
A recent survey conducted by Gather and Mom Central Consulting of more than 1,300 moms revealed that the majority (60%) feel lonely and unsupported in their day-to-day lives and have turned online – to social networking sites, community forums and chat rooms – to make new friends.
Their survey revealed some other interesting facts:
- 71% of moms are connecting online because of shared interests
- over 60% of moms reported making a new friend online in the past year
- 70% of moms talk to other moms online in forums and communities
- 1 in 3 moms who’ve made friends online tell their online friends things they don’t share with offline friends
I explained to my mom that I loved working for myself and that going back to a traditional work setting would not interest me.
I tried to show her how I connect with hundreds of like-minded women everyday through The Mom Entrepreneur Online Support Group, but she comes from a generation of women who did not connect this way when she was my age. Therefore she did not understand.
In addition to connecting online I:
- go out with my husband a few times a month for date night
- meet other women at the gym
- belong to a local mom group that gets together several times a month
- get involved with activities at my kid's schools
I feel very content and no longer disconnected from other women as I once did when I started my business almost 10 years ago.
Work-at-home moms do you feel isolated? What do you do to connect with other women who share the same interests?
Mom entrepreneurs are only human
I returned her call a few hours later...she was not there...I left a message.
She returned my call shortly after that. I have caller ID so I knew it was the same person. I answered...the connection sounded a bit muffled...
"Do you want your hot dog now or later..."
Well, it was lunch time and I was hungry, but I don't think she was talking to me.
"Hello?" I said.
{More muffled conversation...}
"Hello?"
"Hello?"
As I hung up, I started to laugh. That really made my day. It made me wonder if my phone has mysteriously called someone while I was at the drive thru window with my kids at McDonald's or getting a drink at Dunkin Donuts.
And as I sit here and sort through 25,222 emails in my InBox due to a big mistake I made with my email a year and a half ago, I remind myself that mom entrepreneurs are only human.
The Mom Entrepreneur Members Named Leading Moms in Business
This was Startup Nation’s first-ever Leading Moms in Business contest, and more than 621,000 votes were cast, supporting a variety of exceptional mom entrepreneurs. Startup Nation’s goal was to spotlight mom business owners and praise their entrepreneurial spirit, creative ideas and business savvy.
The Mom Entrepreneur’s Online Support Group provides resources, advice, feedback and discussions around topics that are relevant to mom entrepreneurs. Our organization’s online network helped promote members who were in the running for this contest through our newsletter, in group discussions, on our blog, and through online social networks like Twitter and Facebook.
Approximately 50 of our members were part of the competition, and everyone in our online support group was encouraged to vote daily for members who were running. It was due to this huge collaborative effort that many of our members were able to get the votes they needed to win this contest.
As a result, The Mom Entrepreneur members who were recognized as Top 2009 Leading Moms in Business include:
- LTDchix, LLC (#41 from Sparta, NJ)
- Old World Limited (#43 from Shakopee, MN)
- Lily Lane Cakes (#68 from Springfield, VA)
- whippersnappers studio (#71 from Bend, OR)
- Psi Bands (#82 from Pacific Grove, CA)
- CouponDivas (#85 from Matthews, NC)
- Sweetsation Therapy (#115 from Hypoluxo, FL)
- The Adventures of Scuba Jack (#118 from Gloucester, MA)
- Cottonseed Clothing (#122 from Chicago, IL)
- Cushie Pushie Company (#131 from Lawrenceville, NJ)
- Madama Griffitts O'Hara LLP (#172 from New York, NY)
- Personal Child Stories (#185 from Pine, AZ)
- Stroller Strides (#196 from San Diego, CA)
Startup Nation held this contest to celebrate the triumphs, tribulations, capabilities and achievements of moms running businesses across America.
We know first-hand that mom entrepreneurs are tremendous multi-taskers, juggling business and family responsibilities. As a group, we’re resourceful, driven, creative, motivated, passionate about our beliefs, and committed to achieving a successful work-life balance. It’s a great joy to celebrate the achievements of our members, and I am so genuinely pleased that they were recognized in this competition.
Great job moms!
Vote for your favorite mom entrepreneur company introduction by Friday, May 8th
Following are the Top 10 finalists as decided by our judges: Laurie Storey-Manseau, owner of StoreyManseau, LLC, a marketing and advertising agency and Adrienne Walkowiak, publicist at Bisson Barcelona, LLC, an image management, social marketing and public relations firm. Based on their recommendations, I picked the top 10.
The winner will be determined by popular vote and will receive a prize package valued at $150. Please pick your favorite company introduction and leave a comment below with the name of the mom entrepreneur or their company. You may vote only once. The deadline to vote is 5:00pm EST on Friday, May 8th.
Top 10 finalists in no particular order:
A B C D E
Preschool and K our specialty!
F G H I J
Hands-on learning is our way!
K L M N O
For busy families on the go!
P Q R S T
Children love it, you will see!
U V W X Y
Play and learn and time will fly!
Z Z Z Z Z
Little Hands Learning Company!
-Traci Geiser, Owner
Little Hands Learning Company
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Its 10:00 pm - DO YOU KNOW WHERE YOUR GRANDMA IS?
Grandma’s Shoppe open 24/7 - Adorable, artsy, handcrafted and mouth watering gifts for the young and young at Heart! Make Grandma’s Shoppe - Your Second Home!
-Robin Kroll
Grandma's Shoppe
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Are you tired, worn out and stressed? Does the daily grind hold you under duress? Turn to the experts in juggling it all, we help you cut through the clutter, big and small.
-Melissa Smallwood
Organized Life by Design
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Find out how the Consumer Queen got $1880 in groceries for $19. As seen on the Today Show! Our online community of over 18,000 moms can show you how! Deals, Coupons, Hot Contests and more!
-Melissa Garcia
The Consumer Queen
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Support a product that helps “support” you. The Cushie Pushie Breast Support Pillow for Nursing Moms is the cushion that pushes you up. Get the correct breast position for breastfeeding easily, and gives you that much needed extra hand.
-Lois Whittaker
Cushie Pushie
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Did you know over 90% of mishaps occur at home? So you should travel! Visit OurCruisePlanner.com – Where Life Is A Trip! We help friends and families escape to worldwide destinations. The best part is no service fees just great service!
-Jenny Reed
Cruise Planners
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Reinvent the way you plan, shop & eat! With millions of recipe sources, only The Dinner Spin serves up healthy recipes, a complete list & game plan. Add variety, nutrition & savings into your weekly menu plan. Trial at dinnerspin.com.
-Janis Bowers
The Dinner Spin
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"May the formula be with you." "He made me a bottle I couldn't refuse." Those are 2 of the slogans from Baby Fish Mouth, offering movie-inspired tees for your tyke. All shirts come in our Signature Movie Popcorn Box making the perfect gift.
-Danielle Hughes
Baby Fish Mouth
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Once there was a baby boy. He grew and he grew to his mother’s great joy. The day finally came for his diaper to go, but he wanted to stand like his big brother Joe. Dreading the mess she went online and purchased a Flippee for her own peace of mind!
-Annmarie Vanini
Flippee The Toilet Shield
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Tees For Change is an eco-friendly apparel company that inspires positivity with uplifting messages such as LAUGH OFTEN, CHOOSE HAPPINESS and CHASE DREAMS. Buy a tee, we plant a tree!
-Andreea Ayers
Tees for Change
Join us on March 31st at 9:00pm EST for our second Twitter party!

On Tuesday, March 31st from 9:00pm - 10:30pm EST, we will be hosting our second Twitter party to announce our spring line up of offerings at the Co-op Shop.
- Free 1.5 hour phone Beyond Balance Exploration session for working moms with The Executive Moms Coach (valued at $275).
- Free one-year subscription to The Dinner Spin (valued at $48). The Dinner Spin is your weekly menu planner. Each week you receive seven creative, yet convenient dinner ideas in your inbox. Choose the recipes you want to prepare; customize your grocery list and follow the clever tips outlined each week in the menu game plan.
- Free t-shirt from Just Be Products. Winner's choice (valued at $15-$24). Show the world how you...Just Be.
- Free download of the popular ebook PR in Your Pajamas: Practical Publicity for Time Strapped Mom Entrepreneurs (valued at $29). Learn why you don’t need a press release, how to put together a media pitch and a media list in just minutes, the questions you need to ask a reporter when they call you, and more PR tips that helped sell a mom business just 9 months after starting.
- Gift certificate for one-month of service to care4hire.com (valued at $29.99). Care4hire.com is an online database for families and caregivers to search babysitters, housekeepers, tutors, elder/companion care, pet sitters and other miscellaneous services.
- Free copy of The Power of Women United from Discover Birth, which hits shelves this month (valued at $34.97). This book explores the triumphs and tragedies of 22 amazing women who forged their own path to success. This extraordinary book will touch your heart as it helps you to find your true self and follow your dreams.
- Free LaborKit (valued at $54.95), includes over 18 high-quality items to help prepare for birth and make labor more comfortable. Breastfeeding friendly. It’s everything you need for the big day.
- Free Yoga Booty Ballet workout DVD from Team Beachbody (valued at $30). Yoga Booty Ballet is a dynamic fusion of yoga, booty sculpting, and dance that will make you feel strong, confident, and beautiful!
- Free Super-Soft Clean Shopper from Babe Ease (valued at $34.99). Protect your baby from nasty shopping-cart germs with the tried-and-true Super-Soft Clean Shopper! Designed to cover the entire seating area of a shopping cart, this product is fluffy and comfy, and it comes complete with a matching drawstring tote, a safety strap, toy loops and pockets. It's also machine washable and dryer safe!
- Free set of books - Let’s Get Ready For Kindergarten! and Let’s Get Ready For First Grade! from Cedar Valley Publishing (valued at $40).
- Free long sleeve t-shirt from Me Time (valued at $29). Winner picks design.
- Free Personal Child Stories custom made book (valued at $30). All books are created for each unique child using personal photos and custom text; no two are alike. You choose the theme!
- Free satineesnugs bear blanket from My Embroidered Gifts (valued at $19.95). Winner chooses name to have embroidered on blanket.
- Two free product coupons good on any fast fixin items at fastfixin.com from Consumer Queen (valued at $7.99).
- Free Boca Beth Beginner Backpack (valued at $49.99).
Twitter party attendees will be asked simple quiz questions and will need to visit the Co-op Shop to find the answer. Tweet the answer and include the hashtag code #TMEcoop.
Winners will be determined by a sequence of random numbers, which will be generated using Random.org. Public recognition will be given to the winners in Twitter who will need to email their name, email address and phone number to traci@themomentrepreneur.com.
To follow the party, simply follow me @TMECoopShop or visit tweetchat.com, enter the code #TMEcoop and follow the party's conversation.
And don't forget to shop The Mom Entrepreneur Co-op Shop for Easter, Earth Day and National Women's Nutrition Week as well as every month in 2009.
To blog or not to blog? free presentation slides
Many members of The Mom Entrepreneur Online Support Group have asked for my advice about how to make their blog more effective, increase traffic and extend their reach online. Once I finished the PowerPoint slides, I realized that it was an informative presentation for beginners or experienced bloggers. Getting back to basics and revisiting what makes a blog successful is the best way to grow to the next level.
You can access the presentation at this link...> (click mouse to switch slides)
I welcome your comments and feedback.
What is your top 10 must have as a mom entrepreneur?
My top must-have? My Blackberry (or should I say crackberry)!
Getting ready to send a package of goodies to Peter Shankman at HARO

- "I Like It Dirty" Me Time t-shirt
- $25 gift certificate to Navan Foods
- Set of three Let's Get Ready books from Cedar Valley Publishing
- Chic Super-Soft Clean Shopper from Babe Ease, LLC
- $15 gift certificate to Little Jumping Beans
- Book about Peter Shankman entitled Peter Counts to Ten from Personal Child Stories
- Ecofriendly Journals, Photo Album and Cards from Sweet Organics and Naturals
- Teach Your Child Spanish music CD, DVD, coloring and activity book and puppet from Boca Beth
- Set of Parent Success Cards from Horizons Development Remediation Center
- $15 gift certificate to Let's Go Strolling
- One free month of service to Care4Hire.com
- "Just Be Green" t-shirt from Just Be Products, LLC
- Lil' Hands Gardening tote with products from Education Perks
- Free business directory listing, one month free banner ad and one month of free counseling/coaching from ParentsRPeople.com
- Three, free 12-month subscriptions to The Dinner Spin
- 5 free hours of Virtual Assistance Services from Creative Virtual Office
- Three, free downloads of the ebook PR In Your Pajamas: Practical Publicity for the Time-Strapped, Cash-Crunched Mom Entrepreneur from PR in Your Pajamas
- $100 gift certificate for pampering at the Dorit Baxter Day Spa in NY thanks to Just Between Friends
- $50 shopping spree at DoceVidaFitness.com
- $50 gift certificate to Coco-Zen
- Free business card design with purchase of 1,000 cards from Pages & Stuff, Inc.
- Assortment of all natural products from Sassy Shampoo
Vote for mom entrepreneurs in the StartUp Nation Leading Moms Contest
Baby Fish Mouth
Playgroups USA
Tees for Change
Just Be
Cushie Pushie
OriginOne
Nannies4hire
Gratitude Games
Cedar Valley Publishing
Cottonseed Clothing
Lily Lane Cakes
Old World Limited
Sweetsation Therapy
Beautiful Kids Natural Products, LLC
Sweet Organics and Naturals
Gourmet Chocolate Bon Bons
CouponDivas.com
Mimi & Maya
Charmed Life Products, LLC
Pitter Patties
Aristotle Circle
Madama Griffitts O'Hara LLP
Adventures of Scuba Jack
Psi Bands
Education Perks
Win great prizes at our Twitter Party Tuesday night
Tuesday the 27th from 8:30 pm - 10:30 pm EST, we will be introducing the new Co-op Shop, offering tips for balancing motherhood and running a company, and giving away some amazing prizes. Join me and dozens of mom entrepreneurs from our Online Support Group as we chat the evening away.
Following is a list of the fantastic prizes you will have a chance to win:
- $15 gift certificate to Navan Foods
- A complete set up of a Facebook page for a business or organization, including photos, video, description, social media links, applications, contact info. and more from Step Ahead, Inc. ($300)
- Box of 24 truffles and personalized card to send or keep from Cards 4 People ($35)
- Long sleeve t-shirt from Me Time ($29)
- $24 gift certificate to Yummy Spoonfuls
- $20 gift certificate to Let's Go Strolling
- One copy of Gratigories! card game from Gratitude Games ($16.99)
- Second copy of Gratigories! card game from Gratitude Games ($16.99)
- One Gratitude Games Pro Package from Gratitude Games ($29.99)
- One Vision Your 2009, three-week, one-on-one Coaching Program with LaSara Firefox, MPNLP ($199)
- Seat at the Vision Your 2009 teleclass, with LaSara Firefox, MPNLP ($19.99)
- Another seat at the Vision Your 2009 teleclass, with LaSara Firefox, MPNLP ($19.99)
- Six educational board books and CDs for infants and toddlers from Little Hands Learning Company ($23.95)
- Playmat from Mimi & Maya - winner can choose color and personalization ($129)
- A bath/body assortment of items from Pre de Provence, Pure Living and European Soaps from Old World Limited ($30)
- Jerry Garcia tie, 100% silk from Old World Limited ($45)
- Laundry mom t-shirt from LTDchix ($20)
- $10 e-gift certificate from Coco-Zen
- Product coupon good on any fast fixin item at fastfixin.com from Consumer Queen ($7.99)
- 2nd product coupon good on any fast fixin item at fastfixin.com from Consumer Queen ($7.99)
- 3rd product coupon good on any fast fixin item at fastfixin.com from Consumer Queen ($7.99)
- Just Be t-shirt from Just Be Products ($24)
- Set of books - Let’s Get Ready For Kindergarten! and Let’s Get Ready For First Grade! from Cedar Valley Publishing ($40)
- $25 gift certificate to restaurant.com from Coupon Divas
- Box of Swan Chocolates from The Mom Entrepreneur ($9.95)
- Harry and David Winter Tower from The Mom Entrepreneur ($19.95)
- Set of acupressure wrist bands for the relief of nausea from Psi Bands ($15)
Twitter party attendees will be asked simple quiz questions and will need to visit the Co-op Shop to find the answer. Tweet the answer and include the code #TMEcoop. Winners will be determined by a sequence of random numbers, which has been generated using Random.org. Public recognition will be given to the winners in Twitter who will need to email their name, email address and phone number to traci@themomentrepreneur.com.
To follow our tweets, simply follow me @tracibisson or visit tweetchat.com, enter the code #TMEcoop and follow the party's conversation.
And don't forget to shop The Mom Entrepreneur Co-op Shop for Valentine's Day and every month in 2009.
Good Luck!
You are invited to a Twitter Party

Help others and you will be rewarded
These kind words were written in a card that accompanied a box of chocolate brownies. They arrived from Diane Walker who is a senior executive for Send Out Cards.
Diane is a member of The Mom Entrepreneur Online Support Group. Lately, I have been receiving testimonials, phone calls and emails from members expressing their gratitude for creating this online support group.
One member commented that she belongs to many other online mom entrepreneur groups, but that "most of them have fizzled out...but not this one".
It is refreshing to hear the feedback from these women.
The Mom Entrepreneur was created back in April 2008 after I took my son out of daycare and retreated to my home office to save employees' jobs at my other company Bisson Barcelona. A few clients owed us in excess of $12,000. About $6,000 we never collected.
My exploration into social media, while working out of my home office, eventually led to the formation of an online support group. I have a lot of respect and admiration for the women in this group who have shared their innermost fears and desires with me.
I am dedicated to this group of mom entrepreneurs and will continue to do everything that I can to support them and help them succeed.
If you are a mom entrepreneur, join me and over 400 other women in the most productive and supportive group you will ever be a part of - The Mom Entrepreneur Online Support Group.