Source & Authority Information
- •SBA Joint Venture Rules(accessed 2026-01-15)
- •13 CFR Part 121 - Size Standards(accessed 2026-01-15)
Understanding Joint Ventures in Federal Contracting
Types of Small Business Joint Ventures
- All-Small Business Joint Ventures: Partnerships between two or more small businesses that both qualify as small under applicable size standards. Both partners must independently meet size requirements, and combined size must remain small for the joint venture to pursue small business set-asides.
- Mentor-Protege Joint Ventures: Partnerships between an SBA-approved mentor and protege under the All Small Mentor-Protege Program. These arrangements allow small protege firms to joint venture with large business mentors while maintaining eligibility to pursue small business set-asides using the protege size status.
- Program-Specific Joint Ventures: Joint ventures formed specifically for 8(a), HUBZone, SDVOSB, or WOSB program contracts. Each socioeconomic program has specific joint venture requirements beyond general small business rules.
- Unpopulated Joint Ventures: Joint ventures that do not employ their own staff directly but draw personnel from member companies for contract performance. Most small business joint ventures are structured as unpopulated entities.
- Populated Joint Ventures: Joint ventures that employ their own workforce directly rather than drawing from member companies. Less common due to administrative complexity but may be appropriate for long-term arrangements.
SBA Joint Venture Requirements
Forming a Joint Venture
- 1Identify and evaluate potential partners
Select partners whose capabilities complement your own and who share compatible business objectives and culture. Evaluate partner past performance, financial stability, and reputation. For mentor-protege arrangements, identify appropriate mentors and establish SBA-approved relationships before joint venture formation.
- 2Negotiate joint venture agreement
Develop a comprehensive joint venture agreement addressing all SBA-required provisions plus business terms including profit and loss allocation, capital contributions, management structure, decision-making procedures, and dispute resolution mechanisms. The agreement must clearly establish small business control where required.
- 3Obtain SBA approval if required
Certain joint ventures require SBA review and approval before pursuing contracts. 8(a) program joint ventures and mentor-protege joint ventures must be approved by SBA. Submit joint venture agreements according to program requirements and allow processing time before bidding.
- 4Establish the joint venture entity
Form the joint venture as a distinct legal entity—typically a limited liability company or partnership—in the appropriate state jurisdiction. Obtain organizational documents, state registrations, and tax identification consistent with the joint venture agreement structure.
- 5Register the joint venture in SAM.gov
The joint venture entity must obtain its own Unique Entity Identifier and complete SAM.gov registration separate from member company registrations. Joint venture registration establishes the entity identity for contract award purposes.
- 6Complete program-specific registrations
Register the joint venture in applicable program databases including the Dynamic Small Business Search and program-specific certification systems. Ensure the joint venture appears correctly in systems where contracting officers search for eligible contractors.
Joint Venture SAM.gov Registration
Mentor-Protege Joint Venture Requirements
Affiliation and the Three-in-Two Rule
Joint Venture Performance Compliance
- Track work performed by each joint venture member to ensure compliance with performance requirements.
- Maintain management control documentation showing small business decision-making authority.
- Monitor subcontracting to ensure limitations on subcontracting compliance.
- Document all joint venture activities including meetings, decisions, and resource allocation.
- Prepare for potential compliance reviews by maintaining comprehensive records from joint venture formation through contract completion.
