Many think that joint venture finance is difficult to raise, but armed with the right knowledge, and a few tips and hacks in your toolbox, it becomes a far simpler process. But it does require long-term thinking.
Directly asking for money is better than not asking at all. But simply asking for money gives the impression that you only value potential partners for the financial resources they bring. People are far more open to partnering when trust and rapport has already been established.
This is why it’s crucial that we treat everyone we ever meet, in business or in life, as someone who one day, could be a potential finance partner. People don’t care what you know, until they know that you care, and mostly do business with people they trust over any other criteria.
If you are always “radar on” when it comes to the eternal search for finance partners, then we automatically place ourselves in the right frame of mind to form trust and rapport. Never forget that when a partner joins us, they are doing it because they want one or more of their own needs met, not because they want to do favours for other people.
The key in all of this is constantly ensure that we are building out the good will, so that when we need to, we can call in that good will. This is a far better exchange of services that simply approaching people when we are in need, which will be a turn off for most investors.
“Selling Through” is a wonderful technique that makes use of this strategy. Instead of asking a potential investor to become a partner, ask instead “Do you know anyone who…?” And tailor your request to suit your need. This form of inquiry unconsciously still acts as a pitch, but indirectly. The person to whom you ask this will have to give the question some thought, and whether they realise or not, will be considering the deal for themselves. It also gives the recipient of this pitch the perfect excuse to back away if they so choose without having felt pitched-to directly.
This provides a win-win situation for you. If they “know someone who…” then you are put into contact with a potential partner. If they back away, then you have not broken the trust and rapport by asking directly. If they decide the proposal may suit themselves, then you have again found a potential partner.
“Selling Through” is far more effective than “Selling To”
Another way of ensuring our success in finding a potential joint venture partner is greatly increased, is to adhere to the “Seven Lunch Rule”.
Essentially, this rule states that far more people have developed the trust and rapport needed to partner, having spent an average of seven touch points together – email, lunch, dinner meeting etc.
Those who pitch before those seven touch points are statistically less likely to partner. Conversely, those who wait too long can essentially “overcook” their association, resulting in failure.
The takeaways here are to make sure that rapport is built, trust gained, and that we do not appear needy. When the time is right, hopefully around the seven touch-point mark, attract your potential partner by using the “Selling Through” technique.
This combined strategy will greatly increase your chances of success when it comes to creating joint venture relationships. For more information on JVs read some of our other blog posts:
Your network is your net worth so why not attend one of our Property Networking events online. For more details visit the Progressive Property Network
For our ultimate guide on Joint Ventures you can download our free report here