A joint venture (JV) is the formation of a business by two or more persons who have a shared ownership. Along with the shared ownership, they also share the profits, the risks and governance. Combining two entities can also expand their expertise and knowledge.
Joint ventures are generally limited to a precise time period with an average lifespan from 5 to 7 years. There are instances when two or more persons will form a temporary partnership for a specific project, or combine their capabilities to become one joint venture for a short period of time.
In a joint venture, the two entities may profit and be given an edge by leveraging their strength against another similar company. A joint venture can also give a direct and fast pathway for added growth and help gain a better foothold on the market. Almost all joint ventures are incorporated.
At Gantenbein Law Firm, our experienced business attorneys can help determine whether a joint venture is appropriate or perhaps a simpler method such as a contractual agreement may be sufficient. Our attorneys will explain and advise whether a joint venture could leave your company vulnerable or in a dangerous position at a later date.
If you’re considering a joint venture, it’s crucial you retain an attorney to counsel and negotiate the terms and conditions to prepare the necessary documents. Our attorneys will help resolve financial issues such as percentages each party will contribute, what party will manage the operating expenses and whether more funds will be needed.
Other factors that will have to be analyzed and established are the allocation of resources for the joint venture. Who will provide what and who is responsible? Another resource is the appropriation of personnel. What party will provide the employees and how many hours will be set aside for each entity to work on the joint venture?
You want to ensure the joint venture benefits both entities, both are contributing the same amount of resources and both are protected against possible litigation or breaches.
A well-written joint venture agreement can minimize any issues or conflicts that may arise. Gantenbein Law Firm Denver business attorneys have the expertise in contract and business law to execute joint venture agreements that can help create a tremendous opportunity for your business and protect your assets.
If you have issues or questions regarding whether a joint business venture is for you, contact our Business Lawyers to discuss all your options. To schedule a consult, call 303-618-2122.