How to win negotiations and still create working friendships

I’ll be the first to admit that investment bankers have a bad reputation.  Shows like The Wolf of Wall Street or the Netflix series Suits don’t help, but it does provide some insight into the world of deal-doing or mergers & acquisitions (M&A), even if not specifically about bankers.

I’ve lived in this world for most of my career.  I will say that the TV stereotype isn’t always true, and it depends very much on the context (though in some cases it definitely is true).  For most of my M&A career, I’ve worked on mid-market transactions.  These are private businesses that are being bought and sold, where hard-working entrepreneurs realise the fruits of their lifetime’s work when they sell their business.

In the mid-market, egos need to be put aside.  My clients are typically down-to-earth people, who have had a great idea, found a niche or gap in the market, and have worked hard and made sacrifices to achieve success.  They are not high-flying executives sitting in some top-floor skyscraper boardroom scheming up the next acquisition to boost their profile or corporate share price which improves the monetisation of their options.

Instead, my ethos at Corpfin is that the best negotiation is one that creates a win-win situation. It’s not the scene where an Alpha-male guy argues the win for the sake of it leaving the other party bruised and battered on the inside – that style doesn’t work.  It makes the other party more entrenched in their positions, they may lose one point but fight irrationally for others.  This tactic may win the battle but lose the war.

If you take a long-term view as I do, you realise that we will often encounter the same people in some future commercial discussion down the road.  It is far more productive to create an environment that we can great a great outcome for all parties in the current negotiations, and still be able to have an open door to discuss further opportunities in the future.