When you’re in the early stages of growing your business, technicalities like job titles are the last thing on your mind. In fact, there’s a good chance you’re the CEO, sales manager, and IT support all rolled into one.
As your business grows, it makes sense to start formalizing your business’s legal, ownership, and management structures. If you choose to become a partnership or a limited liability company (LLC), then you’ll need to understand the role of a managing partner.
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The owners of an LLC are called members, and they can be individuals or businesses. A member-managed LLC is run by one or more of its members. Alternatively a nonmember manager can be hired to oversee the business. This arrangement is called a manager-managed LLC.
The members of an LLC are sometimes referred to as partners. The managing partner is someone who is a member and a manager of the business. They are responsible for day-to-day operations and implementing long-term strategies.
Mark Donnolo is the managing partner of business consultancy SalesGlobe. The company is an LLC with a handful of partners who are all involved in the business, but Donnolo takes the lead. “I think of a managing partner as a first among equals,” he says. “It’s the person that’s leading the charge strategically.”
Sometimes a business will have more than one managing partner. Beth Hellowell and Nathan Palmer are the co-founders of Signify Digital, a digital marketing firm. The agency is a limited company, a business structure in the UK that is similar to an LLC in the US. Hellowell and Palmer are both managing partners, and they share decision-making and management responsibilities equally between them.
A partnership — like an LLC — is a kind of business structure. There are several types of partnerships, each with different legal implications, but in all of them, it’s common for one of the partners to be selected as a managing partner and become responsible for the daily operations of the business.
Other partners may be actively involved but take less of a strategic leadership role than the managing partner, or they may not be involved in the running of the business and simply provide capital.
A managing partner and a chief executive officer (CEO) are both senior executives who play a leadership role. Usually they are the highest-ranking person in the business. But there are some differences between the two.
Some people view “managing partner” as a legal designation, something to be filled in on a government form, rather than a job role that comes with daily responsibilities. In that case, a person can be both a managing partner, for legal purposes, and a CEO, which is the role that appears on their business card. Others see “managing partner” as a job title in and of itself.
As mentioned above, a managing partner is an owner of the business, but they are also involved in running the business and play an executive leadership role. Not all owners are managing partners.
Some owners are not involved in management and will simply provide capital. Some owners play an executive role but are less senior than another owner who has the title of “managing partner.”
A limited partnership is a type of partnership where at least one person is actively involved in the business (known as a general partner), and at least one person who just provides money but is not otherwise involved (known as a limited or silent partner).
A limited partner shares in the profits of the business but is not responsible for its debts and liabilities. In a limited partnership, a general partner may take on the role of managing partner.
The responsibilities of a managing partner typically include:
They may delegate some aspects of these responsibilities, or take on additional roles. For instance, Donnolo is very involved with business development, intellectual property development, and content creation because these functions match his strengths and past experience, but managing partners with different backgrounds may have other focuses.
At Signify Digital, Hellowell deals predominantly with client management and business development, while Palmer covers work delivery and campaign strategy.
“Having two partners suits our business well,” says Hellowell. “While we have the same passion and vision, we each bring a different skill set to the company.”
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