Bridges don’t collapse for no reason. And Joint Ventures don’t fail for no reason. A well-constructed bridge lasts a long time and does the job it was meant for, as do good business deals. The main reason why Joint Ventures don’t work are essentially very simple, and DollarMakers is designed to use our 22 years of experience to teach people how to create lucrative, long-term JV’s with no cost or risk, so that if something doesn’t work out, nobody gets hurt and we can all remain friends.

Seth Godin brought up some excellent points about where joint ventures can go wrong in his post “Why Joint Ventures Fail So Often” - however he does not provide any solutions other than to say ‘do something that requires more risk and causes you yourself to have a lot more at stake.’

Here are the 6 Top Reasons why Joint Ventures don’t work and their effective solutions:

1. Wrong premise or expectancy: If we assume things which aren’t true, have unrealistic expectations, or misunderstand certain market shifts or requirements, or if we misjudge buying trends or the choices of consumers, a JV won’t work. If set up correctly, with no cost or risk to either party, we can learn from the mishap and live to fight another day, as friends rather than foes. We’re not fortune tellers, and we can’t predict the future, but we can arrange our JV’s in such a way that we avoid any harm being done.
2. Wrong partners: If you’re dealing with weasels, parasites, losers, or conmen, your JV’s won’t work. Do your due diligence and be prepared to walk away as soon as you see the red flags. Again, if you roll out your JV in a small way before committing to a large launch, you can test your partners and the market before going big. In some cases, the JV partner is honest but incompetent, or he simply can’t handle the volume or demand when we have underestimated the response. A good “What if?” planning session with objective evaluations and checks and balances can help avoid that scenario.
3. Greed and ego: When one of the partners gets his ego in the way or gets greedy, things can go awry. Avoid this with solid agreements and contracts and work with mature, seasoned business owners, not incompetent upstarts who don’t know that pride does, indeed, precede the proverbial fall.
4. Insufficient planning and/or quitting prematurely: Often, we’re so excited and in such a hurry to get going that we neglect to plan the details and specify amounts and quantities, percentages and responsibilities, and things fall part because of that. Miscommunications and misunderstandings come from haste, and inexperience and a sense of entitlement, along with the desire for instant gratification result in quitting too soon, instead of tweaking and fixing what could be a lucrative JV.
5. Inconsistency and a lack of self-discipline break down trust and repel good JV partners. A good reputation attracts a good database and solid JV partners, which results in successful Joint Ventures. Don’t get involved with people who are not consistent - reliability and honesty, along with proficiency and integrity, are the mortar that hold good JV ‘s together. Both parties are responsible for the success of any JV.
6. Finally, communicate regularly and effectively. Losers hide behind excuses and don’t communicate well. Most flaws in any JV can usually be rectified through effective, adult communication and openness.

Joint Ventures are the most sophisticated way to make money, and people who genuinely understand Joint Ventures can make an unlimited amount of money with no cost or risk and little time.  Just keep the above 6 points in mind when executing any JV, and you’ll find yourself breezing through your JV’s.

• Are we affected by the people with whom we associate?
• Do we learn and lose by “osmosis?”
• Can it be that we earn within 10% of the people we spend the most time with?
• Have you noticed that the level of success of a person determines the level of people they attract into their lives?
• Are we, in fact, mental magnets?
• Is it true that we are being contaminated by our surroundings, input, and associations anyway, whether we like it or not, and that we get to choose our contamination?

Of course it is true.

Like Attracts Like

Like attracts like. Opposites repel. We are rightly judged by the company we keep, because your friends tell me who you are.

When someone hosts a Bootcamp, the people in the Bootcamp are a reflection of the quality of the host. People recruit people like themselves – the automatic mirror effect.

The Dangers of Third Hand Smoke

My wife is allergic to nicotine. She sat in the front seat of a car being driven by a friend, and a smoker got onto the back seat, still stinking of smoke from her last fix. Rika’s eyes were red for two days. Even though the smoker wasn’t smoking in the car, it was enough to contaminate the other passengers.

See this article about the dangers of Third Hand Smoke, and ask yourself if you will allow your children into the home of a smoker. Probably not, if you love your kids.

Input Influences EVERYTHING

I am contaminated by the books I read, the movies I watch, the people I meet, and the communications I handle, whether or not I want to believe it to be so.

• Positive contamination propels me like rocket fuel towards my objectives.
• Negative contamination poisons the well, dilutes my efforts, sabotages my work, and drags me in the opposite direction.

When I spend time with winners, I leave feeling buoyed up, motivated, inspired, and enthusiastic. After spending time with losers, I feel like I need ten hot showers and a mouthwash. Purge your life of leeches.

Do These Two Things

Monitor your input / contamination for a week, then do two things: remove bad stuff and replace it with good stuff.

That simple. Not rocket science. Not hard to do.

• Resign, as I did, from organizations, clubs, and fraternities that don’t share your philosophy and aspirations.
• Break relationships off with losers, whiners, parasites, and victims.
• Seek out champions and producers, and build strong relationships with them.
• Read good books.

Before you know it, you will feel like a million bucks. You’ll have more energy, bigger goals, and less frustration. Atlas, don’t hesitate to shrug when it’s appropriate.

The key to being a successful Joint Venture negotiator is to have the ability to walk away at any time during the negotiations, and if you threaten to walk away, you have to do it.

There is also a spirit to negotiating – if one party is continually taking and not giving, unreasonably inflexible, arrogant, or “talking down” to the other party, the JV will never work.

Changing the Agreement is Dishonest

Also, remember that changing the rules or moving the goalposts, in other words not honoring what you previously agreed to, is not negotiating, it’s simply being dishonest. Anyone who promises and doesn’t deliver isn’t negotiating; they’re stealing and lying. And if they can steal a few hundred dollars, they will steal millions, too – it’s who they are.

Watch out for cheap, tightfisted people.

Only Talk to the One in Charge

Negotiating with a middleman – especially one who hides behind the authority which they represent, seldom works; try to work with the person who actually has the authority to make decisions, instead of a puppet.

Look for Clues

During negotiations, you can get an insight into the character and values of the person you’re dealing with. Look for patterns, clues, honestly, small lies, and passive aggression. Con artists use greed (the big carrot), threats, bullying, and lots of details to confuse honest people.

Watch Your Emotions

Remain objective and emotionally detached during negotiations. Maintain a healthy dose of skepticism. Business, after all, is a game. You can remove the two emotional issues - risk and cost – with good negotiating skills. Watch your own “Greed Meter” carefully.

Walk Away When Your Gut Says

When you get a negative gut feeling about the other party, don’t bother to continue with the negotiations.

I recently made that mistake by getting involved with religious fundamentalists – they proved that they were totally irrational, and could justify the most ridiculous assumptions and blatant dishonesty by hiding behind their religious delusions. I will be more selective next time. One’s philosophy will drive ones choices and actions. We continue to learn. You can learn from my mistakes.

ALWAYS IN WRITING!

Finally, JV’s should be comfortable, fun, profitable, and very clearly communicated, which means IN WRITING. After a meetings, send the agreements in writing and make sure everyone understands the terms and conditions.

Months down the line, people get selective memory and amnesia. Each party is solely responsible for themselves, and the “blame game” can be avoided if these responsibilities are clearly defined – in writing.

You have millions of options in the world of Joint Ventures – be selective, because you can afford to be. An ounce of discipline is better than tons of pain down the line.

If you’re unsure about how to do this, read this page about how to write a Memorandum of Understanding, otherwise known as MOU, which is a basic Joint Venture agreement.

Why It Pays to be Generous

If someone is comfortable with 10%, don’t try to negotiate 15% - they will be uncomfortable and sabotage the deal or undermine it. And if they’re happy with 10%, offer them 12% - the pay-off to generosity can be massive when dealing with the right people. Test your deals in a small way before launching them in a big way – “Take time to know her”, as the old song goes.

You Can Make More Money Walking Away Sometimes

Remember: You make more money by walking away from money when it’s “dirty” money. By that, I mean you can only earn dirty money by compromising your values and overriding your better instincts. If you’re not comfortable, don’t walk away - RUN - towards better deals!

We all have agendas, however some people have hidden agendas that need to be guarded against to avoid loss of reputation, customers, business, orders, suppliers, or other resources and assets.

Those with hidden agendas will usually agree to everything, and be very friendly and accommodating on the surface, while executing their secret plans under the table. These affable, helpful people use their promises to put one off guard.

The Key is to Limit Access

The way to avoid losing too much to these thieves is to limit their access, control, and exposure as much as possible while testing their loyalty and agendas. This is not cynicism, but rather skepticism.

Hypocrisy Runs Rampant

After 22 years in business, I never cease to be surprised at how well people can hide who they really are. Many are passive aggressive, and when they finally openly turn against you, they are usually very nasty. Those who claim to be “spiritual” and religious have been the worst I have encountered over 22 years – they hide behind a veil of hypocrisy to subdue any suspicions you might have – “wolves in sheep’s’ clothing”, as it were.

11 Tips to Prevent Your Loss from Others’ Agendas

1. Expect the best, but plan for the worst.
2. Have exit plans, contracts, a “Plan B”, and damage control in place before getting involved with new people, if at all possible, especially those who you get that “gut feel” about.
3. Look for patterns and consider reading “The Art of War” sections on spies.
4. At all times, seek leverage and control, but don’t expose your suspicions.
5. Always endeavor to be one step ahead of them, and don’t hesitate to use private detectives if necessary.
6. Protect your relationships and database.
7. Put yourself into communication loops.
8. Consider the worst case scenarios.
9. Don’t bank on the promises of any one person.
10. Also, find out who the real decision maker is, and who the “front man” is.

… And, Of Course, Use Joint Ventures

This is why I use Joint Ventures to make money – I limit my risk, spread my income, and always have many options available. I do as much due diligence as possible on my JV partners and those I am involved with, and while I still get attacked and people still try to steal from me, my risk is limited. Conventional businesses have a lot more to lose from spies and saboteurs than I do as a Joint Venture Broker.

A Healthy, Objective Attitude Will Serve You Well

A healthy dose of suspicion is always a good thing, and warning signs are often there if you remain objective. Once you get emotionally involved, greed and desperation will blind you to what is really going on. Remain, as the Buddha teaches, “Unattached”, hedge your bets, and don’t expect things to last forever.

A mature view of business and life, and access to good mentors will help you to remain strong and rational. Try to see things through the eyes of others, seek to understand their motives, and ask lots of questions.

I knew a jeweler who attended a Dale Carnegie management training program with me  and returned to his business a changed man.  Suddenly, mall security guards started arresting thieves in his store.

When he remarked to one of the security guards that it seemed that crime was increasing in the mall, the security replied that the crime rate hadn’t changed – the guards had simply started intervening and arresting thieves, whereas before, they had turned a blind eye. They were rewarding my friend for his change in attitude towards them. But I digress…

What REALLY Motivates Employees

In his book, “Persuasion IQ”, Kurt W. Mortensen discusses a working paper by Kenneth A. Kovack of George Mason University, Fairfax, VA. Kovack researched the differences between what motivates employees and what managers think motivates employees. Here’s the data:

What Motivates Employees as Ranked by Employees

1. Interesting work
2. Appreciation of work done
3. Being well informed
4. Job security
5. Compensation
6. Growth and promotion opportunities
7. Good working conditions
8. Personal loyalty to employees
9. Tactful discipline
10. Help with personal problems

What Motivates Employees as Ranked by Managers

1. Compensation
2. Job security
3. Growth and promotion opportunities
4. Good working conditions
5. Interesting work
6. Personal loyalty to employees
7. Tactful discipline
8. Appreciation of work done
9. Help with personal problems
10. Being well informed

“Shared Ownership”

One thing that I believe will cover many of these requirements is “Shared Ownership”. I’m not talking about giving your staff shares in your company.  I’m talking about profit-sharing Joint Ventures, where employees get compensated in direct proportion to the value they add as measured in profit.

Front line employees are often to privy to information of which management is blissfully unaware, and many times by design. Empowering your employees by partnering with them:

• gives them an “ownership mentality”.
• reduces absenteeism, laziness, and shoddy work.
• increasing motivation, loyalty, productivity, interest, enthusiasm, and innovation.

Managing the Potential Downside

Opening opportunities to your staff has its downside and risks, and therefore should be carefully managed, watched, and controlled, while allowing enough freedom and accepting enough damage through honest mistakes and inexperience to remove fear and hesitation.

Clearly defined boundaries, regular, open communication, and quick feedback, and awareness of the power of operant conditioning, with it’s requisite fast reinforcement, is essential.

As “partners” (without legal implications, please), most of the above motivational factors (we should also be cognizant of Hertzberg’s Hygiene Factors here) will be more than adequately addressed, indeed enhanced, and your bottom line will see the results.

Many Coaches and Consultants experience the “feast or famine, chicken or feathers” ups and downs in income - they’re either out there selling, or they’re delivering. In addition tp the resulting yo-yo income, they have to deal with:

• Either busy times or quiet times.
• Increasing competition.
• Because they’re selling time, they have limited income earning capacity.
• Many clients regard the consulting or coaching service as a luxury that can be terminated as soon as cash flows get tight.
• The popular perception of coaches and consultants leaves a lot to be desired, which is quite understandable, given the fact that many who use this label are about as valuable as a rotten peach on a busy sidewalk.

How do I know this? I was a consultant for eighteen years. And I’ve specialized in Joint Ventures for small and medium businesses for twenty two years.

The Obvious Solution

The solution to increasing your coaching or consulting business as well as income from other sources, while at the same time differentiating yourself from the herd, is Joint Ventures. It’s a great fit and a great complement to any coach or consultant’s business. Use your insight and communication skills to create lucrative JV’s. Have the money and the time to enjoy it, as well as the luxury not to rely on your income from consulting or coaching.

This is exactly what I did. I no longer sell my time as a consultant, but this information has worked for me for twenty two years and it will work for you.

3 Obstacles Holding You Up…

1. First, understand that you do not have a 100% profit margin, which you do have from Joint Ventures.
2. Second, know that you cannot possibly be all things to all men.
3. Third is the hardest – getting rid of that giant ego. I think ego is the enemy of coaches and consultants. Business is not about sales or being well known – it’s about bottom line, after tax PROFIT.

… And 3 Strengths You Have to Turn It Around

1. You have the ability to cut through the BS and guide and direct people.
2. You can gain their trust.
3. You are a good communicator and you have an understanding of business and human nature.

These are very powerful skills and tools in the hands of a Joint Venture Broker.

Don’t Push. Find a need and meet it.

If my doctor called me last week and informed me that he had a great deal on heart bypasses, I would get worried. Instead, he examines me and points me in the direction of a solution or relief. That’s real business. “Find a need and meet it.”

In a room of 20 “Business Networking” people, not everyone wants a coach. But they all have needs, hopes and dreams. If you’re there to make money by helping people, why not simply link these people, be they clients or prospects, with the solution to their needs and get paid for it? When they want a new house, why try to sell them coaching, instead of introducing them to a good Realtor and getting paid 20 – 50% of her commission? Easy money, no time, no risk, 100% margin. Think about it.

Triangulating JV Deals

Business consultants can make a lot more from triangulating JV deals than selling their time. Become a “Toll Gate” – something like Bill Gates. Create solutions that pay you well. Leverage other peoples’ time, resources, money and access. Something like Ari Onassis. Think about that!

Joint Venture experts know that there are a few guiding principles when setting up lucrative deals that provide ongoing, multiple streams of passive income and large, once-off windfalls. Research is essential before partnering up or even suggesting a Joint Venture to someone. Research is the foundation of successful Joint Ventures.  There are four aspects to Joint Venture research:

1. The Industry or Industries You’re Targeting

Be sure you are comfortable dealing with that industry, that it fits your public profile and values system, that it is aligned with your Mission Statement and identity, branding and business relationships. For example, you probably wouldn’t want to get involved in the sex industry. You might want to avoid contentious or controversial areas like politics, religion or tax shelters. Also, have enough information or access to information about that industry before diving in.

2. The Deal

If you’re good at Joint Ventures you can remove all the cost and risk. Don’t think a contract is going to protect you, by the way - it’s only as good as the people behind it.

• Triangulating deals (setting up a deal between two other parties and taking a piece of the profits) usually removes risk and cost if correctly set up.
• Make sure tracking and monitoring is in place and use the expertise of trusted others.
• Create a Memorandum of Understanding that clearly defines the terms and options in the deal.

Click Here to download the FREE Memorandum of Understanding Template PDF

3. The People

This is the most important part of any Joint Venture. Check them out - do your due diligence and research. Get references, do police and credit checks, even use a private detective if necessary. All that glitters is not gold and people claim some amazing things that are simply not true.

• Get specific information.
• Avoid being bowled over by their charisma and sales abilities. Confidence tricksters use greed and ego to hoodwink their victims.
• Check them out. If they don’t have any money, be careful; desperate people tend to do desperate things.
• Don’t buy their stories. Look for a track record.
• If they’re over eager and urgent, step back.
• Consider applying for Membership in the DollarMakers Joint Venture Forum - our elite members are carefully screened.

4. Education

The more you learn, the more you can earn. We use Joint Venture Bootcamps and seminars, TeleClasses and JV Audits to educate and update people on Joint Ventures.

• Again, be careful who you’re learning from. Unless the person teaching you has a personal success track record, they don’t have the right to teach.
• Look for support and practicality.
• Watch out for the “up sell” lurking in the shadows.

Ongoing education in today’s changing world will complete your research cycle.

Yesterday, I received this encouraging note from a friend of mine who is a very successful entrepreneur:

“Hi Robin,

I just read your Eagle Attitude article and you are right on. I always make asset vs. liability calls.

Recently one of my staff did considerable damage to our main computer and database by going to inappropriate places on the internet. Certainly grounds for firing, not too mention suing for damages. Instead we are reworking his job description to take advantage of some obvious talents. There are some penalties he is working through, but there should be some substantial benefit to the company long term.

It’s nice to read that a risky decision is sometimes the best decision.”

How I Joint Ventured Instead of Firing my Employee

That reminds me of the time I was a manager in a large, resort hotel and we learned that one of the staff members was secretly running his own little room service business inside the hotel. He diverted all the orders to his cousin’s café on the corner. The thing was that he gave excellent service and guests were delighted with the quality (that’s how we caught him – compliments from guests about dishes that weren’t on the room service menu!) So instead of firing him, we created a joint venture: we saved his salary, cut overhead substantially and continued to provide the service to our guest, while his own business flourished. Win/Win!

Savvy entrepreneurs always…

• Savvy entrepreneurs look for ways to capitalize on the strengths and resources of their partners, associates, employees and vendors.
• They focus on what does work instead of what doesn’t work and, most importantly, keep their egos in check.
• Take the time to listen carefully and discover hidden assets like skills, connections, resources and information.
• Know that sometimes, opportunities take a little while to appear and options take time to become apparent.
• Know that patience and good communication skills, as well as being prepared to generously share the profits, are essential.
• Think outside the box and keep your eyes on your common goals.
• Be flexible and open to new ideas.
• Know that good people are hard to find.

Sales Tip

The better you know your salespeople, the better you can channel their energy, interests, skills and time. Don’t make the salesperson fit the job; rather, make the job fit the salesperson. Take time to listen to their opinions and suggestions, encourage sharing and reward innovation and risk.

Management Tip

By clearly defining the parameters of your employees’ jobs, you remove fear. Show them what they have to do to get fired, and you reduce any reticence to innovation. Fear stunts creativity and openness. People who feel secure will be more productive and honest with you. Spend more time developing relationship with your staff than you do with your customers.