joint venture
Definition
A joint venture is a business arrangement where two or more parties agree to work together on a specific project or goal while remaining separate businesses. Each party contributes resources, shares in the profits, and also shares in the risks and losses. Think of it as a temporary partnership built around one particular opportunity rather than an ongoing general business relationship.
Example
A local bakery and a coffee shop might form a joint venture to open a shared weekend farmers market booth, splitting the costs and splitting the profits equally. When the market season ends, both businesses go back to operating completely independently.
Watch Out
Get every detail of the arrangement in writing before you start because disagreements over who owns what or who owes what can get very messy very fast without a solid written agreement.
See which terms appear in your contract?
This definition is for informational purposes only and does not constitute legal advice. Please consult with a licensed attorney for legal guidance.