Do I Need Bylaws or an Operating Agreement Right Away?

Part of our Corporate & Startup series.

Corporations legally need bylaws and should adopt them during incorporation. LLCs only legally need an operating agreement in some states. New York requires LLCs to adopt an operating agreement within 90 days of filing of the Articles of Organization.

The basics

Bylaws (for a corporation) are the internal rulebook: how directors are elected, how meetings happen, voting procedures, officer roles. Every corporation needs them, even a two-person company with no outside investors, and they're one of the first things a board consent formally adopts.

An operating agreement (for an LLC) serves a similar purpose: it defines ownership percentages, management structure, how decisions get made, and what happens if a member wants to leave. Some states don't legally require one, but operating without one means state default rules apply instead, which are rarely what a specific founder actually wants.

Neither document needs to be complicated for an early-stage company. But skipping them entirely is a common gap that shows up later, usually when an investor or acquirer's lawyer asks for your organizational documents during diligence.

What your bylaws or operating agreement actually need to say depends on your specifics:

• How many owners you have, and how decision-making authority should be split among them
• Whether you plan to raise outside money, which shapes what investors will expect to see
• Whether you want unanimous consent required for major decisions, or a simpler majority structure
• What should happen if a founder or member wants to exit, which is easier to agree on now than after a dispute starts

Generic templates cover the basics but rarely reflect the specific decisions your team needs to make about how you'll actually run the company.

Next step

Getting these documents right at the start is far easier than reconstructing intent after a disagreement. Book a quick call and we'll draft something that actually reflects how you and your team want to operate.