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Upside-No Downside Most people when they think about leverage, they think about risk; and this is true when stocks are bought on margin or a corporation takes on debt to fund operations or finance future growth. Further, with this increased risk comes hyper diligence along with energy of both the positive and negative variety. This type of leverage increases stress often beyond optimal levels. The possibility of loss lurks as an ever present danger. The leverage involved in a joint venture is very different. This type of leverage comes from finding hidden assets, overlooked opportunities, underperforming activities, lucrative new revenue streams, profit centers and cash flow bonanzas that have heretofore escaped your company's radar. This kind of upside comes from the leverage that is gained from a partner's resources (See "An Army of Resources") in combination with a new perspective on the new utilization of your own corporate resources. The workload becomes lighter and energy radiates as the result all of a newfound awareness of the windfall within your grasp. Synergy goes from concept to reality. Cooperation, respect and admiration replace envy, suspicion and animosity when considering outside partners. Building each other up instead of tearing each other down is the new byword to business practice. So the upside to joint venturing is clear. The downside can only be seen when greed overtakes trust and cooperation. It will quickly be seen when a potential partner has unscrupulous motives. The emphasis will be upon trying to get the best part of the deal instead of working hard to establish the synergies of the joint venture. Such potential partners will be quickly screened out in the negotiation process. In the course of due diligence, bad business is seen for what it is. What remains in the joint venture process is two companies working to establish mutual benefit for both their patrons and each other. The windfalls from appropriately pooled resources produces an amazing upside for you and your cooperating partners. |
