# Members, Membership Interests, Managing Members ## Members and Membership Interests in an RMI DAO LLC * A membership interest is a general term used to represent a quantifiable voting, governance, ownership, or financial right, depending on the type of entity you register (non-profit vs. for-profit). * Where other corporate types might have "shareholders", "directors", "trusteers", "officers", or other names that can have similar meaning, an LLC (including DAO LLCs) has only "members", "managing members", or other titles as defined in the company's operating agreement. ## Managing Members * DAO LLCs are not required to have Managing Members. For the first time, with the DAO LLC, a legal entity is not *required* to have managers of any kind, but it’s up to you whether you want them. * Managing Members get day-to-day management rights, signatory authority, etc. There are also some social expectations around what managers are, what they get to do, whether they are good, etc. * Another thing to consider is whether you want your DAO LLC to “pass” as a traditional organization when doing KYB with other organizations. For example, if you're going to open a bank account or get a grant, and the bank says, “List your managers…” do you want to be able to say, “OK, sure!” or have to explain why you don’t have managers? ## Tracking Membership on Paper (No Token) A DAO LLC does not need a token. Many DAO LLCs — especially in their early stages, before launching a token or smart contracts — track their members "on paper" the way a traditional LLC does. This is fully supported by the MIDAO template Operating Agreement; you simply select the paper-based membership option rather than the token-based one. If you go this route, your Operating Agreement should be explicit about a few things: * **Membership tracking.** Reference an exhibit (e.g., Exhibit A) that lists each Member by name and their respective membership interest percentages. Update the exhibit when membership changes. * **Profit distribution** (For-Profit DAO LLCs). Define how profits are allocated and distributed — pro rata by interest, equal split, or some other formula. Be explicit. * **Voting and governance.** Define the voting threshold clearly: simple majority, supermajority, unanimous, or weighted by interest percentage. * **Managing Members.** Decide whether any of the Members will be designated as Managing Member(s) for signatory authority, banking, and similar operational matters. * **Terminology.** Use "Members" and "membership interests" — not "shareholders," which is a corporate (Inc.) term. If you decide to add a token later, you can [amend the Operating Agreement](/dao-llc-structuring/dao-llc-operating-agreements-and-amendments.md) to switch to token-based membership tracking. There is no penalty for starting on paper and tokenizing later — many of MIDAO's DAO LLCs do exactly this. --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://docs.midao.org/dao-llc-structuring/members-membership-interests-managing-members.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.