What is a Joint Venture in Business?

Last Update: April 03, 2021

Intro:

Our journey begins lonely, clueless, and fumbling in a virtual internet marketing reality: one-person, one-man-band show. But you'd think the road to richness is an easy feat; when starting, time, energy, and capital are not at our disposal, we may think of going into a joint venture.


Is two better than one?


Why joint venturing?

A joint venture is an arrangement commercial in nature between two or more parties who agree to put their efforts together to achieve a greater goal. Joint ventures utilize workforce and resources, thus making it sound more extensive, reputable, and pricier.


Are pooling in time, energy, and capital resources effective?

That may be so if the budget is limited. Having a partner can sometimes give a cushion should things go wrong or, worse, fails.


Should we be upscaling a project?

It simply means that you are focusing on what is best for the company and is taking what's great about your current operation and building it outwards.


Would material such as webinars, videos, podcasts, and freebies add to the value?

Marketers need to be careful how to jot detailed reasoning they put in their sales page copy, i.e., like an excellent funneling system to convince or capture people in their lists. A joint venture partnering out can help with refinement and enhancement. They are at their best developing top-notch products as in ebooks, membership sites, creating high-impact podcasts, interviewing related niche or industry influencers.


Is your preference a one-person or a joint venture?

While one person may be of enormous benefit as they don't have to share resources or proceeds, they may not be so strategic in terms of time, energy, and capital if thinking of upscaling in planning for something big and highly profitable.


What about an exit strategy? Is that feasible?

The joint ventures intend to meet a particular project with specific goals, so the experience ends when the project is complete. An exit strategy is essential. It provides clear resolutions to dissolve a venture, avoid any drawn-out discussions, legal battles, unfair practices, negative impacts on customers, and financial losses.

An exit strategy can be selling the new business, a spinoff in operations, employee ownership, etc. Each offers distinct advantages to partners in the joint venture and the potential for conflict.


So in summary

Plus Points include:

- Shared investment, i.e., added capital to a project
- Shared expenses, i.e., a pool of resources, bringing down costs
- Technical expertise and know-how, and operational synergy benefit specialized expertise and knowledge to move aggressively in a specified direction with improved economies of scale
- Newmarket penetration entering a new market quickly
- New revenue streams
- Intellectual property gains joint venturing with tech-rich firms to gain access to assets without spending the time and money to develop the support for themselves in-house for developing products or services
- Enhanced credibility, thus achieving enhanced marketplace visibility more quickly
Avoid competition and pricing pressure


Minuses include:

- Partners may outgrow and are no longer aligning with the common objectives
- Cultural mismatches and different management styles, levels of expertise, investments, or assets
- Legal or financial issues have arisen
- No significant revenue growth
- Changes in the market or economic conditions



Abie & AJ

Ideas? Thoughts? Questions? Further research notes are always welcome.
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richardgb Premium
Hi Abie
Excellent article. Thank you.
I see some great advice below.
Past experience of handling software JVs during the 80s led me to ask myself "If we didn't have a legal framework for this relationship, would I still want to deal with these people?".
I.E. I tested my level of trust. If my answer was no I turned the opportunity down. As you know, it's the integrity of the people involved that counts.
:-)
Richard
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countrylife Premium
Hey Abie
Thank you for this terrific blog post.
I want to express few thoughts here. However, I must warn you I am very green in this area, and my experience is limited. I want to do JV here in our small town, but on a tiny scale, the purpose is exposure to folks living in the big cities.
I recently noted my artifacts with a member here discussing a different plan; my project is as follows:
" My niche is close-knit Country Living. I am thinking of interviewing local businesses in our small town and promoting on YouTube to give city folks a more concise, accurate description of what it is like living in a small town and an array of eventful marketing strategies alongside my blog, in-depth detailed analysis. What's the right way for a beginner like me with a specific niche to enact a JV (joint venture)? How to grow and explode my outreach? Marketing strategies etc., do you do some funneling system with a JV system. How to efficiently convert? Budgeting required?"
I am looking forward to great advice, my budgeting as of now is limited but happy and willing to trade with my time instead; the sooner I seed, the earlier I can reap, and I must admit I am not a very patient person, and I analyze anything and everything I like to work mathematically and systematically into finding best operational procedures to carry out reasonable and thoughtful acts I want to nurture my thinking further and widen my chances of making this a success. Therefore I welcome any advice, however that sound from any folks in the house.
Wishing you well, a terrific day, and a fantastic Easter Weekend
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lurtchatv Premium
Well, that was a very inspirational request. Not too many folks actually admit to how little they know about something, BUT, your line of thinking emanates More than that. I am sorry I do not know much at all about (JV's), and like Jeffery said below I like to be hands on and alone. However, your ideas and plans seem to be amazing. I would look for the advice to bring this to life yourself.
Monatizing this idea is the only issue I see technically? What if you actually increase the Business around the community by 10 or 15% due to your advertising. How would you credit for those customers that made purchases in establishments in your community, Unless they had an Online Ordering presence? It doesn't seem that way to me.
Again, I do not know anything that would help you, BUT, I love your ideas and I hope you are able to bring those ideas to some sort of REALITY 👍👍 Best of Luck to you 👏👏

Glenn
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lurtchatv Premium
PS - I hope you had a wonderful Easter Week-End as well🐰🐰
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Kingschido Premium
Thanks for sharing your knowledge on joint venture. Good idea on other possible ways going forward..
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Villageist Premium Plus
Thank you for a wonderful resource, I had a JV once while living in Mauritius for one year and that didn't go well and it was with a tycoon from South Africa.

We all learn from our misfortunes. Life goes on and so financial losses goes down the drain.

However now I have a JV also in Mauritius as an offshore venture in the pharmaceutical niche business. Pipelines channeling out through regions of Africa and the Middle East and it is doing exceptionally well. Headed by a very resourceful person, I am very happy indeed and life is good.

Word of advice, know your partners well before you embark on a business partnership. Test the waters often times.

Thank you Abie & AJ.

Happy Easter weekend.
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Israel777 Premium
Wonderful idea. Something I might consider in the future. Thanks Abie and AJ.
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