Have you heard the term “JV partnership” and thought that it meant any kind of Strategic Alliances or Partnerships with other professionals because of how the term is being used?
I’m not sure how or where this misuse of the term JV (Joint Venture) partnership began, but it’s now widely used throughout the coaching industry—incorrectly. Usually, coaches are referring to a promotional partnership when they use this term, but it is a misnomer.
A true JV partnership exists when two or more entities come together under a legal, written agreement to work jointly together on a specific project (which can be limited) or specific purpose. And those partners share in profits, losses, and the benefits of that new creation. Because of it’s complexity, usually a holding company with joint ownership is created (for liability reasons and ease of accounting) but it can also be done with a well outlined legal agreement. An example you may be familiar with is Deepak & Oprah’s 21 Day Meditation Experience which is a JV partnership between O Course and The Chopra Center.
JV partnerships are an advanced type of Strategic Alliance and they shouldn’t be taken lightly.
It is risky to form a JV partnership without having worked or collaborated with someone before because it is a legally binding agreement and those are challenging to unwind when it isn’t working as planned. It’s kind of like getting married: You really want to make sure you marry the right person because divorce is never easy even if you are consciously uncoupling.
Aside from JV partnerships, there are five other primary types of Strategic Alliances that are great fits for coaches:
In this partnership, you promote for them, they promote for you, or you both promote for each other. Sometimes there is an affiliate fee, sometimes not. You get to design how it works as long as it feels like an equal energy exchange.
Here, you refer business to this person or entity, or vice versa. Sometimes there is a referral fee involved, and sometimes not.
This might be someone with whom you co-design a workshop, write a book, etc. They key with this scenario is that you both bring something unique to the table so it feels like 1+1=3. An important foundation to these partnerships is that you aren’t simply sharing the same pie you’d have on your own with two (or more) people and that by working together, you can increase not only the value to the clients but also to each other. We all love to collaborate with other brilliant people and these can be really juicy experiences. But ultimately, collaborative partnerships take more time and energy than going it alone so you want to make sure your profit margins really work.
In an Extension Partnership, you come under someone else’s umbrella (or vice versa) as a contractor but maintain your own separate business. The umbrella company markets, sells, and contracts with the clients.
While the coach may only receive 30-70% of the fee that the end client is charged, all the coach has to do (usually) is show up and do their great work.
If you want to scale your business, being the umbrella company and bringing other coaches/trainers under your umbrella can be a very profitable venture. Or if you really just want to do great coaching, finding an extension partner can allow you to focus less of your attention on the marketing/biz development side of your business.
Expert Team Member
An Expert Team Member is someone who provides services that are outside a coach’s primary sweet spot. For instance, if you’re an executive coach, you might bring on an expert team member who specializes in 360 Reviews or other Assessments, Team Development, Image Consulting, or something else that is outside your direct realm of expertise that your clients need.
When you find a good strategic partner, they may serve in several of these categories, as a promotional partner, referral partner and expert team member all rolled in one. This teamwork allows you to leverage your time and energy and create a deeper impact for your clients.
Truly successful strategic alliances take time and energy to nurture, but can be vastly profitable and fulfilling. What kind of strategic alliances do you want to forge? Post a comment below and let me know!