What is a member-managed LLC, and why does RYDA use it?

It's an LLC where the members (the co-owners) hold authority over material decisions, not an outside manager. This is what keeps RYDA a luxury access platform, not an investment product.

Two types of LLC governance

LLCs come in two flavors: manager-managed and member-managed.

Manager-managed: a designated manager runs the LLC. Members are passive, like shareholders. This is what most fractional investment platforms use, which is what makes those products securities.
Member-managed: the members themselves run the LLC, vote on material decisions, and hire service providers as needed. This is what RYDA uses.

Why this matters for RYDA

Member-managed structure is a cornerstone of RYDA's non-investment positioning. The SEC's Howey test for what counts as a security asks whether members expect to profit from the efforts of others. In a member-managed LLC, you and your co-owners ARE the others, you hold authority. RYDA is hired to perform specific services, not to run the LLC. This is structurally similar to how a country club, condo association, or vacation-home co-ownership group operates, none of which are securities.

What you actually decide as a member

Whether to sell the vehicle (75% supermajority).
Whether to perform modifications (75% supermajority).
Whether to replace the vehicle on a total loss (75% supermajority).
Whether to renew or terminate the management services agreement with RYDA.
Day-to-day operations are delegated to RYDA, but you can revoke that delegation by member vote.

This is fundamental to the structure, not a marketing angle. If RYDA were the manager of the LLC making the operational and financial decisions on behalf of passive members, the arrangement would be a security and require Reg D / Reg A registration. Member governance is what keeps the structure consumption-first.

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