Glossary
Joint venture
An arrangement in which two or more businesses create or jointly own a venture, sharing control, investment and returns, as an alternative to one acquiring the other.
In plain English
Joint ventures are sometimes used when two agencies want to work together in a market or on a capability without a full merger, or when a larger group wants to test a relationship before acquiring. They can be structured as a separate company or as a contractual arrangement.
They require clear agreement on control, funding, profit sharing and what happens if one party wants to leave or buy the other out.
Why it matters
For founders, a joint venture can be a step towards a sale or a way of accessing scale while staying independent. It also brings a partner into decision making.
What to watch for
- Agree governance and exit routes at the outset.
- Consider how the venture affects the value and saleability of each party's own business.
- Legal and tax structuring needs advice.
Transaction language and legal treatment depend on the agreement and the jurisdiction. Written by Motion Advisory Partners as general guidance, not legal advice.