A joint venture, or JV, is the name for the entity created when two companies or individuals create a mutually beneficial partnership. Joint ventures can be a great means for small businesses to gain market share or increase their skills and services. In order to create a successful JV, however, there are a few things to keep in mind.



If you rush into a joint venture, at best you will be wasting time and money -- or at worst you could destroy the business you\'ve worked hard to create. To avoid these pitfalls, you must choose the right partner, create a shared vision and make sure you stick to an organized business plan.





The choice of partner is the most vital part of starting a JV. You should know the person well enough to have confidence in them and to know whether they are trustworthy. There are plenty of fast talkers out there who are eager to separate a fool from his money. As with everything else in life, if it sounds too good to be true, it probably is.



It\'s best to find out as much as you can about any partner candidates you\'re considering. Look up information about them online and ask them for references and a detailed resume.



Knowing as much as you can about your partner is important, but it can be detrimental to enter into a business agreement with a close friend or loved one. If the JV were to fail, you could lose a valuable relationship along with your business. It can also be tempting to cut corners if you\'re working with a friend. It can be awkward to write out a binding legal contract that outlines both of your responsibilities when you would rather just trust the person to uphold his or her end of the deal. If you give in to this temptation, it might turn out that you never had the same long-term vision of the JV at all, and it can turn into a disappointment for all involved.



You\'ll want to look for a good balance in a partner -- someone you know well enough to trust, but not so well that your personal relationship will get in the way. Your partner should possess a skill set that will compliment your own. For example, perhaps you\'re really great at marketing products, but you lack organizational skills. Look for a partner whose organizational skills can make up for your shortcomings and who, perhaps, needs assistance with marketing.



Determining that both you and your JV partner share a common vision is another important aspect. To reach a particular goal together, you must both know what the goal is and understand how you\'re going to get there. If your partner believes the goal of the JV is to grow the business to a very large one, and you believe the goal is to keep the business small so you can run it on the side, you\'re not very likely to work well together. You can\'t possibly reach both your and your partner\'s goals because they conflict!



Maintaining proper books and adhering to the business plan can make or break your JV. To start, write out a clear business plan that lines out your expected achievements and benchmarks for getting there. The plan will also define each partner\'s responsibilities.



Along with a clear business plan, it\'s important to draw up a binding contract that outlines the legal details of your JV. This agreement will articulate the legal responsibilities of each party.



Establishing a successful JV also requires that you organize your time. Don\'t spread yourself too thin. Understand that a new business takes a lot of time and energy. Don\'t expect to be able to focus on two projects at the same time. Choose a time in your life when you have enough time, support, and resources to really focus on the JV.



With a good partnership, common goals and excellent organization, a joint venture can be just the thing to increase your fledgling company\'s size, offerings, technologies and skills. Taking the time to do your homework and learn as much as you can about the process can make the joint venture work for you as hard as you are working for it.