Joint Ventures (JVs)

Provide companies with complementary capabilities and  resources, such as distribution channels, technology, or finance

Provide companies with the opportunity to obtain new capacity, expertise, and information and synergize capital, technology, human resources, risks and rewards in a formation of a new entity under shared control

Allow companies to offer their customer new value, new products and services

 

 

 

Allow companies to save money when businesses share operating, advertising and marketing costs

Allow companies to save valuable time when businesses share the workload

Allow companies to gain new business associates and get referrals from other businesses

Allow companies to enter into related businesses or new geographic markets or obtain new technological knowledge

Have a relatively short life span (5-7 years) and therefore do not represent a long-term commitment


More benefits of JVs for startups

 

  

 

In the era of divesture and consolidation, offer a creative way for companies to refocus, exit from non-core businesses: companies can gradually separate a business from the rest of the organization, and ultimately, sell it to the other parent company (appr. 80% of all joint ventures end in a sale by one partner to the other).

 

Peter Drucker advice

The greatest change in corporate culture and the way business is being conducted may be the accelerated growth of relationships based on partnership.

Peter Drucker