Joint Venture (JV)
A business arrangement where two or more parties agree to pool their resources for a specific task or business activity, sharing risks and rewards.
Implications
A business arrangement where two or more parties agree to pool their resources and collaborate on a specific project or business activity, often used to enter new markets, share risks, and leverage complementary strengths, with profits and losses typically shared among the partners.
Example
Example: A car manufacturer forms a joint venture with a technology company to develop electric vehicles, combining the manufacturer�s expertise in automotive production with the tech company�s knowledge of battery technology and software.
Related Terms
Different from mergers or acquisitions, where one company typically takes over another, joint ventures involve shared ownership and collaboration, with each partner retaining its own separate identity.
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