What Titles Are Used When You Co-Own a Business?

Starting a business is exciting (and stressful). You’re making plans, securing funding, locating a space and deciding on a corporate structure. Before your business gets up and running or shortly after at the latest, you should decide on a title for yourself and for any other owners. Choosing a co-owner title can be complicated, though.

If there are one or more co-owners, deciding on a title is more than just a practical concern. There are egos and personalities involved, which you should keep in mind as you decide on the right title for yourself. Don't be afraid to get creative with your title if that fits your business but make sure that works for your co-owners as well.

Tip

Often, co-owners of a business use titles that indicate their role in the business, such as "director of finance" or "director of marketing." You may also choose a simple title like "co-owner" to show you are on equal footing with the company’s other owners.

Co-owner and partnership titles in companies should be chosen carefully. The title you choose is a reflection on you, your partners or co-owners and your business. For example, creative business-owner titles such as "chief elf" or "chief executive of fun" can get attention, but they may also give the impression that you’re not serious about your business.

Another example is a more traditional title, such as "president." Although this implies someone who is in charge of your business, your co-owners may not appreciate the implication that they answer to you unless that is actually the case. This is why it is essential to discuss your title with other stakeholders inside your business.

You may also want to discuss your potential titles with outside parties and your legal counsel. Outside parties can help you determine the impression your potential titles give. Your legal counsel can let you know if using certain titles within the context of a partnership or corporation will bring any legal complications.

Partnerships are relatively simple business structures. The three most common types of partnerships are:

• Limited liability partnerships. These partnerships limit the liability of all partners, which means that their personal assets are protected if there is an issue that relates to another partner in the business. For example, physicians may form a limited liability partnership, and each partner will be protected from malpractice suits filed against another partner.
  
  
• Limited partnerships. Limited partnerships have one partner with unlimited liability, while the rest of the partners have limited liability. Typically, the partner with unlimited liability is more involved in the day-to-day running of the business.
  
  
• General partnerships. This structure is more informal and may be in place before a formal business structure has been chosen. In a general partnership, all partners are personally liable for business debt.

Your title should reflect the type of partnership you have and your position within it. In a limited partnership, a co-owner who is the partner with unlimited liability may well use a title such as "president" and be justified in doing so since he is taking on significantly more financial risk and is more involved in running the business on a daily basis.

In a general partnership, though, using the title of "president" could imply that you see yourself as higher than your partners, who may be equally involved. In this case, you may want to define yourself by your role in the partnership, such as "director of finance."

Limited liability companies have multiple owners. Each person who owns part of an LLC is a member of that LLC. In some LLCs, each member is involved in running the business, while in others, there are some members who are silent and others who manage the business, and these members are called "member-managers."

The title of "member" or "member-manager" isn’t very descriptive, though, so you may want to choose something that gives a clearer impression of your role within the LLC. For example, you may want to go with "creative director" if you are involved in the marketing and creative direction of the LLC or "technical director" if you head up your LLC’s IT concerns.

You may want to avoid titles that use the word “partner” even if you have a small LLC with just one or two other people, as that could confuse potential clients and lead them to think your business is structured as a partnership, which is technically a different legal structure.

C corporations and S corporations are two common ways to incorporate your business. An S corp is limited to 100 shareholders, and all of them must be U.S. citizens. A C corp has no limitation on the number of shareholders. Both types of corporations offer liability protection for its owners.

Corporations have a board of directors, which is a group that provides high-level direction for the corporation. Boards often include inside members (people who work at the corporation being governed) and outside members (people from outside the corporation). Boards typically have officers, such as a board chairperson, secretary and treasurer. These titles may differ from the role a board member plays within the company.

Corporate officers are typically chosen by the board, and they tend to have traditional titles such as "CEO," "COO" and "CFO." If you have a small corporation, you may have people serving multiple roles. Since corporations are highly structured, you may want to stick with a more traditional title or combine a traditional title with a creative one, such as "CEO/chief provocateur."

For clarity, you and your fellow business owners may want to choose traditional co-owner job titles. Some traditional titles for co-owners include:

• CEO. "Chief executive officer" implies that you’re the one in charge. This might be fine with your co-owners, but it’s worth checking with them. It also implies that you have a large, traditional business, and that may not be the impression you want to give if you have a cutting-edge startup. 
  
  
• President. This also implies authority, and it has some of the same issues as the title of "CEO."
  
  
• Founder. If you’re starting a business from scratch, this could be a good fit. You could also go with "co-founder" as a nod to the other founders.
  
  
• Director. This choice is traditional but can also show your role within the business, such as "director of operations."
  
  
• Owner. This may be the simplest option, and it implies that you are heavily involved with your business. You could also go with "co-owner" to show you are on equal footing with the company’s other owners.

Traditional business titles are immediately understandable, and they give others a clear sense of what you do or your position within the company.

The sky really is the limit when it comes to creative titles. You could choose something that fits the overall culture of your business, such as "chief provocateur" or "accounting guru." You could go with something playful, such as "head geek" or "the boss." It’s up to you and your co-owners to find titles that fit your business and your roles within that business.