If you’re an entrepreneur, you may love being in charge of your own business and your own projects. However, there may come a time when you simply can’t reach a goal without a little help.
When your goals and another business entity’s goals align, that’s when joint ventures come into play. While they offer a lot of advantages, they can also present some specific challenges — especially if you’re used to directing things on your own.
Here are some tips on how you can make a joint venture a success:
1. Clearly determine what each party will contribute.
You don’t have to split your work evenly — whatever you decide works is fine! However, get the expectations in writing. That way, you won’t suddenly find out that your partner expects to carry only about 20 percent of the load when you were expecting a more balanced division. You also want to clearly define — as much as possible — who will handle which operations. That cuts down on the potential for conflicts and confusion.
2. Define the length of the agreement.
A joint venture without a predetermined expiration date can leave you hanging without the ability to move on easily. Deadlines make it easier to set goals — and goals are the key to your success.
3. Determine how the results of your efforts can be used.
Do either of you have the right to take whatever your joint venture produces and sell it elsewhere? Who owns the intellectual property that comes out of this joint venture? Those are questions you want to ask long before it could possibly become an issue.
4. What happens if there are problems between you?
One of you may run into problems and be unable to complete the joint venture. Or, you may simply find it impossible to agree on something critical. What options do you each have in adverse situations like these?
As you craft your agreement, a business law attorney can help protect your interests and make sure that the agreement is fair.