In 2016, SBA amended its rules to implement the statutory changes which allow small businesses to rely on similarly situated entities to comply with the performance requirements applicable to set-asides. SBA also amended its rules with respect to JVs. A firm can have two mentors total in its existence, a mentor (including affiliates) can have up to three proteges at a time. A firm that participates in SBA’s MPP can participate in the MPP of other agencies. The protégé must receive profits commensurate with the work performed or higher. The protégé must own 51% of any JV entity (typically an LLC), must be the managing venturer, and an employee of the protégé must be the project manager (and cannot be a former employee of the mentor). The JV agreement must identify what the parties will do and contribute. For example, in a service contract where the performance requirement is 50%, the protégé must do 20%, the mentor can do 30%, and 50% can be subcontracted to a third party. A protégé must do at least 40% of the work that applies to the type of set-aside, and the mentor can do up to 60%. Once a mentor protégé relationship is approved by SBA, the parties can JV for any type of set-aside that the protégé qualifies for and can form multiple JVs as long as the relationship endures, which can be up to six years. 81 FR 48558, 85 FR 66146.Ī mentor can be a large business.

SBA initiated the All Small MPP in 2016 and then combined the 8(a) and All Small MPP in 2020. Subsequent legislation gave SBA the authority to create an MPP for other socioeconomic categories (SDVO, WOSB, HUBZone) and then ultimately all small businesses.

SBA created the 8(a) Mentor Protégé Program (MPP) in 1998, and it gave 8(a) concerns the opportunity to joint venture (JV) with a mentor and compete for 8(a) and small contracts. Updates and Opinions on Timely Topics Impacting the Government Contracting Industry from GovCon Expert Ken Dodds

Sba mentor protege joint venture