A joint venture (JV) is a business agreement in which parties agree to develop, for a finite time, a new entity and new assets by contributing equity.
They exercise control over the enterprise and consequently share revenues, expenses and assets.
There are other types of companies such as JV limited by guarantee, joint ventures limited by guarantee with partners holding shares.
In European law, the term ‘joint-venture’ (or joint undertaking) is an elusive legal concept, better defined under the rules of company law.
In France, the term ‘joint venture’ is variously translated as ‘association d’entreprises’, ‘entreprise conjointe’, ‘coentreprise’ or ‘entreprise commune’.
But generally, the term societe anonyme loosely covers all foreign collaborations.
In Germany, ‘joint venture’ is better represented as a ‘combination of companies’ (Konzern).
With individuals, when two or more persons come together to form a temporary partnership for the purpose of carrying out a particular project, such partnership can also be called a joint venture where the parties are “co-venturers”.
The venture can be for one specific project only – when the JV is referred to more correctly as a consortium (as the building of the Channel Tunnel) – or a continuing business relationship.
The consortium JV (also known as a cooperative agreement) is formed where one party seeks technological expertise or technical service arrangements, franchise and brand use agreements, management contracts, rental agreements, for one-time contracts.
The JV is dissolved when that goal is reached.
Joint Ventures are in, and if you’re not utilizing this strategic weapon, chances are your competition is, or will soon be, using this to their advantage….
possibly against you!
Our primary goal is to make you a successful joint venturer.
This will happen if you are an informed entrepreneur.
Thus, it is necessary for us to dive into the technical aspects of joint ventures.
What is a joint venture?
How does it work?
Should I start a joint venture?
What are my chances of success?
What are the risks involved?
What are the legal implications of a joint venture?
What is a joint venture?
A joint venture is a strategic alliance where two or more parties, usually businesses, form a partnership to share markets, intellectual property, assets, knowledge, and, of course, profits.
A joint venture differs from a merger in the sense that there is no transfer of ownership in the deal.
How does a joint venture work?
The process of partnering is a well-known, time-tested principle.
The critical aspect of a joint venture does not lie in the process itself but in its execution.
We all know what needs to be done: specifically, it is necessary to join forces.
However, it is easy to overlook the “hows” and “whats” in the excitement of the moment.
We will look at the “hows” in our review of the Eight Critical Factors of Success.
For the moment, let’s keep in mind that all mergers, large or small, need to be planned in detail and executed following a strict plan in order to keep all the chances of success on your side.
Here is your chance to finally build your business and make the cash your products and services deserve with these Joint venture Secrets.
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