So, you are a senior executive of a big corporation, and you want to enter into a partnership or joint venture with another company? That can be very beneficial, but there are some issues you have to deal with.

At RevelX we take minority stakes in companies we believe in, either with our own capital or we arrange larger stakes through our extensive network of Private Equity, VCs, and Angel investors.

We like to become part of the businesses we invest in. Investing for us is both sharing risk and rewards. You can count on us to take responsibility and accelerate the growth process of your company. And, our commitment is long term.

Why a Partnership?

The partnership between big corporations and early-stage companies is beneficial for both. I will describe 4 reasons why you might consider investing in a startup:

  1. The organization will be the first to gain access to fresh ideas.
  2. It will be the first to be aware of new market trends.
  3. The corporation can supplement its own proposition with the product or service of the startup.
  4. The legacy company’s staff will see how fast and flexible a startup can be.

At a side note, startups will also be rewarded for partnering with a bigger company:

  1. They will have more extensive financial and material resources at their disposal.
  2. They get access to a network of third parties and, in many instances, a big client base.

In other words, everybody will gain. So, why not buy a startup today?

Wait a Minute…

Of course, the acquisition of a startup is not something you decide while reading this article. I have described the advantages, but there are also possible pitfalls that you have to think about:

  • Not only the capital must be shared, but also the costs – and some startups know how to spend money, all while making no profit.
  • All agreements have to be written down properly in contracts. You don’t want uncertainty when problems arise.
  • Think of an exit strategy in advance. Sometimes. it just doesn’t work out. You should never dismiss that possibility.

Next Step!

Now that you have your feet on the ground, I will give you a step-by-step plan on how to enter into a partnership or to set up a joint venture:

  1. Ask yourself which set of criteria will determine for you if a partnership will have added value.
  2. Investigate potential partners.
  3. Network with these companies.
  4. Plan follow-up meetings with a number of possible partners, and select the most suitable candidate.
  5. Prepare a confidentiality agreement.
  6. Make a letter of intent.

Need any help? Just let me know, and I’ll see what I can do!