Continuing Omar’s thoughts on startups and business, today there’s a small section on deals and negotiations.
Understand what you really have to lose (which is usually not much)
If you are a person with a laptop and an idea, don’t worry about messing up the 100m dollar business you think you will someday be.
Russell adds: It’s hard to emphasise how important this is. In reality, most people have very little real downside to having a go and even if the idea doesn’t work out (and most don’t let’s remember) you’ll still learn a ton, which will add considerably to your value in business.
I’d also add, on a related note, that far too many entrepreneurs get paranoid about protecting their idea to the point of paralysis. The value of most ideas is in the execution, not in what the concept actually is. To make it reality, you need to share it – actually, with as many people as possible, counter-intuitive though this might seem. And in my view, forget about NDAs and the like. They’re pretty useless all round as far as I’m concerned, but for one man and a laptop, a total waste of time and effort, which at best just create speed breakers for your idea.
Leave something on the table
If your partner feels as good as you walking away from the table, you are much more likely to have a successful relationship
Russell adds: This is so important. Many self-proclaimed “great deal makers” focus too much on getting the best for themselves and wonder why the relationship falls apart or never achieves its potential.
Wait until the rubber hits the road to evaluate a deal
Don’t get too excited until the results actualize. Most deals are not as good as they look on paper
Russell adds: Oh yes. If I had a penny….etc
It’s also worth remembering that many of the best deals come from existing relationships with partners or customers. This isn’t as sexy as hunting down the big mammoth stomping around in the jungle, but effective account management is a skill you ignore at your peril and every company could improve this aspect of their operation.
Omar’s next thoughts will be on Sales and Marketing.