A joint venture (JV) is where two businesses agree to do something mutually beneficial and leverage each other to make more money.
It is one of the fastest ways to grow your audience and business. In my own business Joint Ventures have exploded my business into 6 and 7 figure revenue in weeks. I’ll share some example a little later…
First, let’s take a look at 3 critical elements of a successful business:
- Targeted niche traffic
- Products or services to sell that are targeted to that niche.
- Multiple ways to build relationships with people in that niche (eg. high quality content, effective email sequences, video, audio etc etc.)
One of the fastest way to fill in the elements you don’t have in that business model is to do a joint venture with someone who does have them.
- Have traffic, but not a product… do a JV.
- Have lots of relationships, but no way to monetize those contacts… do a JV
- Have a great product, but no audience… do a JV
Getting the idea?
If you already have a successful online business joint ventures can give you access to large lists of highly targeted customers rapidly increasing your sales, customer base and email subscribers.
In brick and mortar businesses joint ventures with other related but non competitive businesses can also be highly lucrative, again by opening up markets and customers you don’t currently have access to.
The great power of a well executed joint venture is they cost little or nothing to do and you can be bringing in sales almost immediately.
Example Joint Ventures:
- Parcel Ads – When you deliver a physical product include an advertisement for a complimentary service to reduce delivery costs and increase profit margins
- Co-Reg – If you have an email list you could allow people to tick a box to register to a list of a complimentary website, and that other website does the same for you
- Affilliates – Do you have a product but no audience? Consider getting affilliates. For better or worse, the Internet Marketing launch market is built on affilliates and cross promotions.
- Financing – Could you get more customers if you offered financing using a third party? This is a big revenue source for many car dealers, but can be applied to many business models.
- Add-On Services & Upsells – Can you increase your client value by offering other upsells from third parties like insurance after buying a vacation, or an SEO audit after buying web design… Could your service be that add-on for others? I am growing PressCable on this very principle.
- APIs – Could your technology or data enchance another service in return for payment or exposure to their audience… many SaaS business are based on the API model.
- Republishing – Do you have great content that other sites, newsletters or email lists would benefit from publishing to their audience on an ongoing basis, in return for exposure of your brand, and traffic back to your site or offer.
- Events & Conferences – Does an event need a speaker or workshop that you could deliver in return for exposure? Click here for a comprehensive list of marketing conferences.
- Retargeting Sharing – If you have a retargeting list could you advertise another business on your retargeting list if they do the same for you?
- Solve Another Business’ Customers Problem – A company that can generate traffic for a business might lose customers if those customers cannot convert the traffic, which could be solved if they sell a third party whitelabel conversion tool. Can your product or service help another business’ customers succeed or vice versa?
- Recommendations – An accountant could send out a letter or an email to his best business clients recommending a cleaning service or a printing service or a marketing service, in return for a commission or recommending their accounting firm.
- Social Media – A website on business could retweet and share on facebook content from a economic analysis site, and vice versa, to help increase their viral exposure and list.
All these examples generate rapid revenue, customer satisfaction, or traffic with minimal costs.
If you’re working with multiple brick and mortar businesses as clients you can also engineer joint ventures between businesses that are non competitive but target the same types of customers.
Finding the Opportunity…
- Who do you know that has a large audience that would be interested in your product, services or website?
- Do you have a number of contacts or potential clients within an industry, that is useful to someone else who has a number of different contacts or potential clients that is useful to you?
- Who can you find that has a product that your audience would be very interested in?
- Is there someone that is great at building sales funnels and drive more sales to your product in return for a share of profits or other benefits?
- Who could train, educate or coach your customers so they get more out of your product, and you share in the fee?
- Is there a charity that contains your target market that could benefit from your finances or other help?
- Do you know someone that is well connected in your industry, who could grow your business, and join in from the profit?
- Can you help another business that is weak in an area you are strong, and vice versa?
- Is there someone who produces brilliant content in your niche that you could give more exposure too?
- What other businesses share your target audience but don’t directly compete where you could trade advertising real estate to cross promote?
What’s In It For Them…?
Once you’ve identified a potential joint venture partner who has something you need (like traffic, an email list, the ability to create products or sales pages etc) then you have to think through why they should do a joint venture with you.
Put simply…what’s in it for them?
Also be aware that for many of the best joint venture partners making money is NOT the first thing they think about when they’re thinking of a potential joint venture.
It’s more likely they’ll be thinking of things like:
- How would this product serve my customers?
- Will this add to or compete with products and services I’m already offering my customers?
- Is this person going to fulfill their promises? Are they committed to great customer support?
- How is this going to effect my relationship with my customers? Will they appreciate it or will it burn them and kill their trust in me?
You need to think through what’s likely to appeal to them the most based on their current business and things they’ve said and done in the past.
Doing some research on them will help enormously. Read their emails and their blog posts. Ask anyone who knows them well about them and how they operate.
Any insights you get can dramatically increase your chances of building a successful relationship.
It’s All About Building A Relationship…?
So once you know you can deliver something of value and you’ve done some research what’s the first step in making a joint venture with someone?
This is like building any other relationship.
You need to do what’s appropriate at each stage to get to the point where the person will trust you and be open to doing business with you.
If it’s clearly a slam dunk for them (for example you have a huge targeted email list or massive traffic you can send their way) then it can be as simple as contacting them with the idea.
On the other hand if they’re already very successful it’s probably going to take a little longer to make it into that inner circle of people they trust.
In this situation you can start by doing something useful for them. You might create a special add on report for one of their products that you give to them or you might send them a testimonial for one of their products.
You might also just send an email telling them how much you appreciate what they do in the niche and why. Posts on their Facebook page might work in a similar way.
The key is you want to think through how you’re coming across with any contact you make and be patient if that’s what’s needed.
Some relationships take time and you want to be the guy they’re happy to communicate with…not the annoying intrusion in their life.
Put It In Writing…
What is important is to be very clear about what each of you is expected to do and when.
If there’s money involved it’s vitally important to put in writing who gets back what, how they get paid and when they get paid.
Putting this into a written document or an email is fine…
What’s important is that both parties understand exactly what the arrangement is and what’s expected of them.
Do You Need Contracts…?
In a large percentage of cases contracts are a waste of time and money.
Are you really going to to take legal action against your joint venture partner if they don’t fulfill their part of the deal?
When you’re doing a joint venture it’s more effective to take the time to ensure your joint venture partner is honest and has a good track record of dealing with people fairly.
Be Fair & Flexible…
As your joint venture progresses you’ll have a lot more information.
One party may be putting in a lot more work than expected or may have more costs than expected.
It pays to be fair minded and flexible…willing to change your deal a little so both parties stay happy.
Remember that you’re co-operating because you can make income that you wouldn’t earn working alone so try nurture that relationship and help keeping to working for both of you.
In niches where joint ventures are common getting a reputation as a person who goes out of their way to look after your joint venture partners will also help you pick up other highly valuable joint venture deals.
One tip: if you change your initial agreement put the changes in writing too. You want your agreements to be clear and easy to refer to so there are no misunderstandings down the road.
Remember It’s A Process…
Putting together successful, profitable joint venture deals is a process.
You might get lucky and have a highly profitable deal first time out of the gate.
But it’s more likely you’ll have to grow your skills and your business a little before you have a home run.
The good news is you can do this over and over until you hit on a joint venture partnership that works for you.
Share your experiences and questions for joint ventures below…