Joint Venture(JV)

Overview

A joint venture (JV) in government contracting is a formal business entity created by two or more companies to pursue specific contract opportunities. The partners combine their resources, capabilities, and past performance to compete for work that neither could win alone. JVs are especially common among small businesses leveraging socioeconomic set-aside programs.

Why It Matters in GovCon

Joint ventures let smaller firms punch above their weight. A small business can partner with a larger, more experienced company and still maintain its small business status for set-aside purposes (if structured correctly under SBA rules). This is a powerful strategy for building past performance and accessing larger contracts.

Key Details

• SBA Rules: Under the SBA's mentor-protégé program, an 8(a) or other small business can form a JV with its mentor and remain eligible for small business set-asides.
• Populated vs. Unpopulated: A populated JV has its own employees; an unpopulated JV draws staff from the partner companies.
• 3-in-2 Rule: A small business JV can receive no more than three set-aside contract awards over a two-year period, after which it must recertify.
• JV Agreement: Must specify each party's responsibilities, ownership percentages, profit/loss sharing, and management structure.
• Past Performance: A JV can leverage the past performance of its individual members for proposal purposes.

How GovCon Data Can Help

Use GovCon Data to identify opportunities where a JV approach makes strategic sense — the AI analysis can flag contracts that require capabilities or past performance beyond what a single firm can demonstrate.

Related Terms

• Mentor-Protégé Program
• 8(a) Business Development Program
• Small Business Administration (SBA)
• Teaming Agreement