Joint Venture strategies

2 Replies

I have done joint ventures before but have all been structures as equal partnerships with capital investment and share of profits. Can I get input on JV structures when others have been the catalyst for finding and managing deal with other partner being involved in a lessor hands-on role but more on the money side?

I 've read that many do it as a 50/50 profit split, The initial investment being one partner the money the other the Finder and project manager. I'm just not comfortable with someone who has no money to lose with everything to gain. It is way to easy for the finder to take big chances with no skin in the game. I realize everything is negotiable, Just looking for others who have had experience good and bad and how they would do it differently.

I'm aggressively looking to grow and JV is an accelerator but I want to do it with win win approach.

Thank you :)

Originally posted by @Ralph Galdorisi :

I have done joint ventures before but have all been structures as equal partnerships with capital investment and share of profits. Can I get input on JV structures when others have been the catalyst for finding and managing deal with other partner being involved in a lessor hands-on role but more on the money side?

I 've read that many do it as a 50/50 profit split, The initial investment being one partner the money the other the Finder and project manager. I'm just not comfortable with someone who has no money to lose with everything to gain. It is way to easy for the finder to take big chances with no skin in the game. I realize everything is negotiable, Just looking for others who have had experience good and bad and how they would do it differently.

I'm aggressively looking to grow and JV is an accelerator but I want to do it with win win approach.

Thank you :)

I only do JV Agreements where I am the Managing investor and the Capital investor puts up of all the money. I do all the work and have the expertise. He puts up the money and has no responsibility but to deposit his profits. We split 50/50.

The real question is why do I need him? The profit is made in finding the deal and in the "buy". Obviously he would find the deal and put it together if he had my abilities and expertise and time and sales experience. I've been at this for 25 years buying "off market' and making boat loads of money for me and my Joint Venture partners. I'd probable "fire" anybody that didn't think I added value. Not to be mean, I just don't need the headaches of wannabes who think they can do it. If they can "do it", they don't need me. I have plenty of money sitting in the bank that I can use if I choose to but I don't use any when I Joint Venture because there are SO MANY people out there that want to be investors, have a bunch of money but don't have time or the experience or the personality to pull it off. This puts money into their pockets, I meet new people and make friends and I teach them the process along the way.

I've done the 50/50 with capital and profits but am moving more to my partner (who is fully employed and has no time to help) putting up the capital and I'm managing partner.

This will help us both because I do this full time and she does it part time.

Let me just say though, we have a great level of trust having already done deals together before.