A Look at Some Different Joint Venture Structures

A professional in real estate investments and business development, Stuart Bienenstock has served in executive roles that include senior vice president at Bank of NY and a consultant at Ernst & Young. Currently, Stuart Bienenstock draws on this experience and a master of business administration from the NY-based Columbia University at the real estate investment firm Triple Five Group. As the director of business development for Triple Five, Stuart Bienenstock manages end-to-end business-development processes and secures joint venture equity funding. 

Joint ventures refer to cooperative business arrangements in which multiple parties work together toward a common goal. Since joint ventures carry some risk, such as business failure or shared liability, they are often created with a joint venture agreement that details the terms and structure of the arrangement. 

Joint ventures are often structured as a business partnership, a separate business, or as a limited cooperation agreement. Limited cooperation agreements involve business alliances in which two parties work together in a limited way. For example, one company may utilize another’s distribution network. 

Alternatively, in cases where added flexibility is required, a new business may be formed. In this model, each partner holds a management position in the separate joint venture business. The full partnership model offers the most involved joint venture structure. In these circumstances, businesses typically form a limited liability partnership, but can even go so far as to merge.