Sign a joint venture agreement if you intend to pool resources with another entity to pursue a common goal, especially when it comes to sensitive information or incentive agreements. This type of agreement expands our above definition for joint ventures and allows you to meet with one or more other people or companies to carry out a particular project. Joint ventures are particularly common in real estate, media and technology. First, finding a joint venture partner (or more than one partner for large joint ventures) starts with the clear definition of your goal. For example, you may have developed a new product, but there are not enough wide distribution channels to bring it into stores. You can ask other business owners which distributors they use and do independent market research. Then, talk to different distributors to assess their interest in a joint venture. The terms of a joint venture should be recorded in a written joint venture agreement. While a written contract is not legally necessary for the creation of a joint venture, it is the best way to ensure that each party feels engaged in common efforts and knows what is expected of them.
At the other end of the spectrum (minus dollars, minus paper), I helped a technology client create a contractual joint venture with another company in his sector. The other company brought some technologies, and we brought customers and website traffic to the table. Together, we agreed to monetize our traffic by selling the other company`s technology to visitors and customers. This is very similar to affiliate marketing, which is a big deal on the Internet. Bloggers and publishers with content and traffic collaborate with companies that can sell products. Bloggers and publishers sell the products to their readers and they keep a percentage of the sale price. It is a kind of joint venture. Since most joint ventures in the United States are incorporated as an LLC, you probably need to understand how to make an LLC. A joint venture usually consists of two or more individuals or companies that come together to carry out a limited project in terms of scope and time. Once the project is completed, or on a fixed date in the future, the joint venture will end. Of course, entering a joint venture is not a decision that should be taken lightly.
One of the most important things to evaluate is whether you are engaging with the partners of the right joint venture. Part of the selection of joint venture partners is the evaluation of what they put on the table. It`s good to choose joint venture partners that have resources that your business doesn`t have.