Have you had the experience of having so many ideas in your mind with no capital to carry it out? This calls for innovative way to raise or find funding. One such way is through a joint venture.
What is a joint venture?
A joint venture is a business arrangement where two r more organizations or individuals agree to bring their resources to accomplish a certain project. An organization may have a certain resource and looks for a second organization with development funds to accomplish a project.
Its different from a partnership because in partnership, two people come together to run a business but a joint venture is for a specific business or venture and for a specified period of time. It promises greater benefits for the parties but it also have potential of bringing certain challenges.
What are the advantages of a joint venture, not just a joint venture Kenya?
Advantages of a Joint Venture
1 – New insights and expertise
Forming a joint venture will enable you to gain more knowledge and expertise in a certain area or activity or even market. Whatever insight or expertise to gain is dependent on whatever the joint venture what formed to achieve.
2 – Better resources
A joint venture will enable you to access better resources, financially, skills or technology. As an expert in joint venture Kenya, we have seen individuals and organization benefiting immensely from a joint venture arrangement because f the resources that the incoming partner brings.
3 – It is only temporary
A joint venture is formed to last for a few years, many lasting for 3-5 years. This period is enough for the project to be completed and investments to be recovered back. Many people would not want a lifetime joint ventures. When thinking of getting a joint venture partner, you should think of a project that can be done and returns realized within this period of 3-5 years.
4 – Both parties share the risks and costs
The cost and risks are shared by both parties. This is likely to minimize risks for all parties. Since you share risks and gains, you also share losses in agreed ratio.
5 –There are ways to exit a joint venture
There is always means and channels of exiting a joint venture. If a joint venture is not working as envisaged, then an exit strategy exist for you to come out.
6– You will know what’s yours and will be able to sell it
In a joint venture, you have a clear picture of what will be yours and how you will receive the money worth of your share in the joint venture. For example, a joint venture for apartment for sale will clearly show you the number of units which belongs to you and what amount you will get when they are sold and even during when they are rented out.
7 – You are more likely to succeed
A joint venture gives you a higher chance of succeeding because the incoming parties bring competence, market presence and resources which you currently don’t have and a result gives you a better chance of success.
8 – You will build relationships and networks
Joint ventures assist in building business relationships and networks that are long lasting. Through these networks and relationships, more jobs can be created.
9– Your potential will virtually be limitless
Joint venture makes your potential virtually limitless as you stand a chance of achieving much more through joint ventures. You will have partners and momentum to go far.
10- International joint venture eradicates the risk of discrimination.
Globalization has given birth to international joint venture and more companies are embracing it. This is a greater opportunity to work together with people from all walks of life bringing together dynamic training and experience.
Are you thinking of going into a joint venture? We can help you become your joint venture partner or connect you with a joint venture partner in Kenya and beyond. Talk to us today and let see how we get on with your journey to connecting with a joint venture partner. West Kenya Real Estate Ltd has successfully presided over formation of several joint venture businesses.