One main advantages of partnerships is that partners from different backgrounds provide different perspectives, which helps in comprehensive decision-making. They brainstorm together and generate different ideas and solutions. The partners can check and balance each other’s decisions, which reduces the risk of errors.
Features of partnership
| General Partnership – Features | Limited Partnership (LP) – Features |
| Equal management rights | General and limited partners |
| Joint liability for debts | Limited partners have restricted liability |
| Shared profits and losses | General partners have full management control |
| Easy to form and dissolve | Limited partners contribute capital but do not manage |
| Limited Liability Partnership (LLP) – Features | Joint Venture – Features |
| Limited liability for all partners | Temporary collaboration |
| Shared management responsibilities | Specific project or goal |
| Protection from personal liability for business debts | Shared resources and expertise |
| Suitable for professional services firms | Defined time frame and terms |
| Strategic Alliance – Features | Silent Partnership – Features |
| Cooperation without forming a new entity | Silent partner invests capital |
| Shared resources and capabilities | No active management role |
| Focus on strategic objectives | Receives a share of profits |
| Flexibility in structure and duration | Limited liability for silent partner |
| Public Private Partnership (PPP) – Features | Master Limited Partnership (MLP) – Features |
| Collaboration between government and private sector | Traded on public exchanges |
| Public service or infrastructure projects | Combines partnership and corporate features |
| Shared risks and rewards | Tax advantages |
| Long-term contracts | Typically used in energy and natural resources sectors |