Joint ventures, partnerships, and M&A deals with all the cases where two or more business entities come together but each of them is a distinct phenomenon. A business partnership is typically made up of two or more people, whereas a joint venture is a collaboration between two or more businesses.
One common example of a partnership is a law firm where the “partners” have their name on the business. Partnerships are also distinct from joint ventures in the fact that they are usually intended to be long-term business. Joint ventures, on the other hand, are typically oriented toward a single objective. Another example, Uber and Volvo have formed a joint venture for the sole purpose of researching self-driving cars.
Like business partnerships, mergers and acquisitions are typically intended to last indefinitely. M&A deals represent a complete merging of two business entities, including their assets and liabilities. Joint ventures are preferable for projects that are limited in time and scope, while M&A transactions are better when one party wants to have control over the other party’s business.