Strategic partnerships are formed when two business entities collaborate for a mutually beneficial purpose. A legal contract, which delineates the obligations and rights of each partner, defines the partnership. This contract creating and defining a strategic partnership must designate the responsibilities, obligations and contributions of each partner.
Strategic partnerships allow for the sharing of assets. For example, one partner may be relatively unknown while the other may be a well-established and respected firm, thereby increasing marketability. Ventures may also share resources such as equipment, workforce, experience, knowledge and infrastructure. In addition, companies located in different geographic locations may also share access to markets to broaden their collective market base.
Partners must also decide on the legal structure of a partnership. One option may be to create a separate business entity in which both parties share ownership. If the parties choose this structure, the partnership is a joint-equity venture, and both individuals typically negotiate and sign a joint-venture agreement and memorandum of understanding. In some cases, the partners may choose not to establish a joint-equity venture. However, a legal contract delineating each partner’s roles and responsibilities may still provide some protection to both parties.
Strategic partnerships often involve many intricacies and complex legal decisions. Seeking the advice of an attorney with knowledge and experience in Texas laws governing such entities could help to ensure that the partnership is created appropriately and may help avoid future legal issues. With the right structure and a well-developed contract, a strategic partnership may be a sound business decision that will benefit all parties in such a venture.