4 Types of Investment Partnerships to Embark on this year

I’ve always been of the opinion that partnerships are overly underrated in Nigeria.

Most people want to do it all alone so that they could earn the profit all alone. But doing business alone can be quite limiting.

You could build a private business that makes 1 million Naira monthly, but then you could partner with others to build a business that makes over 100 times that.

I remember the story of my former landlord, who was a government worker. Working with one of the government ministries, he had great job security.

But the problem was he was going to be retired in five years time.

He knew he had to set up some business to help him continue training his children in school and also for his retirement.

He first set up a dry cleaning business which failed. He then set up an agro business, which also failed.

Then he became wary of starting another business. Not until he decided to partner with a couple of his friends to start a restaurant and bar.

This partnership business is now flourishing and earning him more money than he made while in public service.

So, what’s the lesson here?

The lesson is that a partnership business or investment could help achieve way more than you can do by yourself.

Through partnerships, you could start a great business, purchase a valuable property, and invest in an asset that you ordinarily wouldn’t be able to invest in alone.

And that is the essence of this post.

We’ll be looking at four types of investment partnership you can leverage to start investing this year.

Any of these partnerships could help you scale up your investment portfolio, give you massive exposure, and help you spend less time managing your investments.

Let’s take a look at them.

Family Ventures

This is the safest type of investment partnership you could leverage, as it has the highest form of trust.

Have you seen a business with a name such as Edu & Bros limited? That’s likely a family venture.

Family members with aligned interests could come together with the aim of starting a business or investing.

This way, they could invest in bigger projects and achieve more instead of going it all alone.

Investment Clubs

Investment clubs and cooperatives are one of the best avenues for pooling investment funds.

This is where friends and associates come together to pool funds towards starting a business or investing. 

In the case of my former landlord, he resorted to his group of friends and associates to start a business with shared risk and responsibility.

A big advantage of an investment club is that you do not only pool funds. You also pool skills, experience, and initiative.

This helps to make investments and build businesses with better structure than you would when you do it all alone.

Private Equity Investment

Private equity investment is one of the easiest forms of investment.

It is strictly investment-to-business, where you find a good business opportunity and partner with the owners via equity investment.

Equity investment is very interesting because you could become a dormant partner, have a large spread investment portfolio, and work less while earning more.

You could also invest in businesses at different stages or in different industries, depending on how you value the business opportunity.

In my opinion, private equity investment is just like buying stocks, but with more control and a closer relationship.

Most times you find better deals via private equity investment than you could dream of finding on the stock exchange.

Venture Capital Deals

This is similar to investment clubs but different in terms of the relationship of the partners.

While investment clubs have friends and associates investing as partners, venture capital deals involve investors with shared business or Investment interests.

Venture capital partnership deals are mostly short-term or could last as long as the investment.

They also come with term sheets and membership fees, and investment structure which must be strictly followed.

This is similar to what the guys at Tekedia Capital are doing. For just $1,000 you could join their venture capital deals and invest alongside a team of experienced investors and venture capitalists.