If you’ve ever walked into a negotiation hoping for the best, you’re already behind.
John Richardson has spent decades teaching negotiation at MIT’s Sloan School of Management and working with the Harvard Negotiation Project. He’s seen founders leave millions on the table not because they had a bad business, but because they made mistakes that were entirely avoidable. This week on Built to Sell Radio, he walks John through the big ones.
A few things that might surprise you:
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You’re already the first offer at the table. Every day you choose to keep running your business, you’re making an offer to yourself. That changes how you should think about every bid that comes in.
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Buyers can smell desperation. Richardson says if you walk in without a backup plan, they know it. And they’ll use it against you.
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The retrade is coming. It happens in almost every deal. Richardson gives you the exact language to push back without blowing up the transaction.
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Your highest offer might not be your best deal. A clean exit at a lower number can be worth far more than a bigger check with a five-year earn-out attached to it.
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Don’t state your non-negotiables too early. Saying “I’m not doing an earn-out” in the first meeting can end a conversation before it starts, even if the buyer would have agreed to your terms.
This one is worth a listen before you take any calls from buyers.
Quote of the Week
You never have to accept a bad bid if you are ready with a plan for what you’re going to do if the deal doesn’t work.
