Creating something together.
WHAT A JOINT VENTURE IS
A separate arrangement or entity formed by two or more parties for a specific purpose.
WHEN IT SUITS
Substantial shared investment Entering a market neither could alone Long-term collaboration requiring its own structure
WHY IT IS DIFFERENT FROM SIMPLER PARTNERSHIPS
It involves shared ownership, shared control and shared liability.
WHAT TO ESTABLISH BEFORE FORMING ONE
The purpose, precisely What each party contributes Ownership proportions How it is governed How profits are distributed How it is funded going forward How it ends
WHY FUTURE FUNDING MATTERS
Ventures require more money than planned, and disagreement about providing it destroys them.
WHAT TO AGREE
What happens if one party cannot or will not contribute further.
WHAT GOVERNANCE MUST ESTABLISH
Who decides what What requires unanimous agreement How deadlock is resolved
WHY DEADLOCK PROVISIONS MATTER
Equal ownership without a resolution mechanism paralyses the venture.
WHAT MECHANISMS EXIST
A casting vote in defined circumstances Referral to an independent party A buy-out mechanism
WHAT TO ESTABLISH ABOUT CONTRIBUTIONS
What each party provides: capital, assets, people, technology, customers.
WHAT TO VALUE
Non-cash contributions, explicitly.
WHY
Disputes about the worth of contributed technology or relationships are common.
WHAT TO ESTABLISH ABOUT INTELLECTUAL PROPERTY
What each party brings and retains What the venture creates and who owns it What happens to it on dissolution
WHAT TO ESTABLISH ABOUT EXIT
How a party may leave How their interest is valued Whether the other may buy it
WHAT TO OBTAIN
Legal and tax advice before forming anything.
