negotiation skills

Let’s look at some tips that will help entrepreneurs handle negotiating sessions with confidence and success.

The best of us can sometimes lose perspective, be unmindful of certain aspects of the business, or be swayed by certain issues to the neglect of others. So it is important that entrepreneurs don’t allow themselves to be caught alone with one or more of investors team when negotiating. Get your lawyers, advisers, fellow entrepreneurs or management team on your side and in the same room before you begin negotiations.

Never over the Phone

Don’t convert a phone call into a negotiating session, not even when you think you are prepared. Entrepreneurs should not put additional pressure on themselves by carrying on a conversation that is actually a negotiating session. In hurried calls, entrepreneurs are likely to make hasty decisions or commit themselves to a position that may be far from ideal. Be polite but firm and seek face-to-face negotiations.

Preparation Is Key

Remember that while this might be your first session, or maybe the first few, investors are far more experienced. Negotiation is an art. While entrepreneurs can’t expect to become master negotiators, preparation can help a lot.

Set Goals

Depending on what you are negotiating, set goals and a broad range between which you are willing to negotiate. For example, how much of the company are you prepared to give away? It helps to set a range before you begin negotiations.

Start High but Be Realistic

A good negotiation strategy is to start high, without being ridiculous, and show a readiness to make concessions. It will reveal an entrepreneur as ambitious but practical, and keen for a deal. At the same time, don’t succumb to sharp bargaining.

Avoid Deadlocks

A good negotiator can see a deadlock before it really emerges, and has a way to avoid them. On many occasions, it is useful to defer negotiations on a particularly thorny issue, maybe to the next session, and find common ground on others. This gives both sides the time and the opportunity to do more home work and/or take a more dispassionate view.

Be a Good Listener

Good negotiators are good listeners. Be alert to every word and don’t let your attention slip.

The single most important trait you need to possess or develop is patience. Deals with investors do not take place in the matter of a few hours. They happen over several negotiating sessions. Give yourself enough time and space to carry out the talks.

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