You'll end up negotiating anyway. You are probably in one now. You just dont know it.
The reality is most relations in starup land are negotiation. That is it. Its about how strong your hand is any instant.
Raising funds? Negotiate. Hiring top talen(really, any talent)? Negotiate Retaining talent? Negotiate Closing a sale? Negotiate Finding a contractor? Negotiate Finding a workplace? Negotiate
A few things I've learnt about negotiating. This combines what life has taught me, what friends and family has taught me, w hat business school taught me, and what really good people like Mr. Voss and Mr. Mehra from HBS have shared online:
- Make it non zero sum. Make it multi faceted. You will each need those levers.
- Start with no. This felt odd but it actually is true. It disarms people.
- Do an accusation audit. They'll do it anyway(rather probably already have). How much % do we want of this round? This founder doesn't seem like he has the right experience. Or, I am not sure he will be able to hire top talent.
- Similarly, use labels. If you are stuck, saying 'sounds like we are stuck' is really good. It helps the team build tactical empathy.
- Then, there is mirroring. It helps to repeat the last few words an investor or a candidate has said. It shows you were listening.
- Summarize. This is powerful in an obvious way but it also helps you shape up the conversation well.
- Avoid making the first offer
- Use anchoring to your advantage. Similarly, don't let them anchor you. Say 'its completely out of the ball park so I am n ot even going to acknowledge it'. Get a really low ball offer.
But a lot of these discussions would miss the mark if they didn't really focus on the bigger picture. Startups are like an ever expanding pie, done right. They create (or should create) opportunities at warp speed. This means people get an opportunity to grow if they want to. They can stretch themselves. Companies can reward employees via an employee pool. They can promote people or give them chances to cross skill. Everyone wins. Ignoring this dynamic is like letting the single biggest win-win lever go wasted. Don't do that. Startups have a lot stacked against them. This is one of the rare aspects(along with experimeneting with endless creativityperhaps) that they have going for them. And its effective. We wouldn't see people leaving well paying, comforatble jobs to go to startups otherwise. -- INSERT --