Focus on the Deal First, Then the Details

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I have done many types of deals over the years. I have sold services, created venture opportunities for myself and clients, partnered, started businesses, launched new products and have helped people along the way who needed a little more vision or strategy. I can see deals that others can’t see and can see the myriad of steps and obstacles along the way to make the deal happen. It’s been fun, and I look at the world as a giant playground of opportunities.

It does take great intentionality and vision to make deals happen. Putting deals together is unnatural. Human nature enjoys the status quo too much and rarely chooses to rise above the noise to create more for themselves. Why change anything, even if it is better, when what you are accustomed to has an illusion of safety from its perceived comfort and familiarity? Everything in life and reality is working against you.

That’s why deal making has to center around the ideas first. Focusing on the possibilities and opportunities. Help someone to see what you see. Do they align? Do they trust you and your conviction?

The details are second. Yes, there’s likely a ton of work, cost and failure once you get a deal done. And it’s good to sketch out some of those back-of-napkin style to enhance the communication and experience around the deal. But obsessing about details that may or may not happen can kill a deal. Quickly. To a lesser degree, bringing in the details can overwhelm customers or partners. You are setting up the other party to extend the buying cycle or to simply say no.

I like to focus on the deal first. The ideas, upside opportunity, and possibilities are what catalyze deals. It’s why I insist on “Deals first, then details.” Otherwise, you end up killing deals that don’t get to see the light of day.

Much of this is because the ramp up and overhead are so low today to be able to test an idea. You don’t often have to go and buy brick and mortar real estate or hire a bunch of people first. You can see if your idea has viability with experimentation. You can test the demand or even the business relationship to see if it will even work. That’s the creative part of deal making. Take out the risk and find the essence of whether the idea has legs by prototyping.

Most people are sitting around waiting for something to happen. A few people are out there making things happen. Focus on deal making. Details come second.

The Competency vs. Likability Conundrum

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Try doing business without being likable. Getting connections and deals become hard quickly. We live with immense choices in who we want to deal with, and unpleasantness can simply be ignored for the next great option.

Of course, there are a lot of charmers out there as well. They can be completely likable and know how to create that aura of likability through warmth, flattery, smiles, encouragement and so many other gestures we appreciate in friendship.

When given a choice we do business with people that we like. Ideally, the likable people are competent as well. Likability is fantastic when we are talking short-term, but long-term still comes down to competence. We have deliverables, customers to please and dreams to achieve. A likable, incompetent person is not going to help us if the goals are real.

We know to avoid incompetent, unlikable people. I think people will tolerate unlikable, competent people. But those relationships tend to dissolve over time when the right crisis or opportunity come along.

The tricky decisions come into play with likable, incompetent people. Do you have a blind spot, or a soft spot, for such souls? If you find yourself making excuses, rationalizing or defending such people, perhaps your sympathies have taken you too far from center.

The carrying costs for the likable, incompetent person builds up over time. And if times are fat or life is good, fine. Enjoy the company and friendship.

If you are building an organization, the competent folks can grow resentful when they see the deference and overlooking eyes you may have for incompetence. You may not call it that, but it’s there for everyone to observe.

A lot of trying to get where you want to go has to do with your decision making on talent, opportunities and risk. When you look at your results and what you want for yourself, consider this one area and get honest with yourself. Do you reward incompetence? Does likability simply disarm you? You might need a way of getting clear and avoid the traps you create for yourself.

Make Good Deals So We Don’t Hate Each Other

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I have always said,

“Good agreements make for great relationships. Bad agreements make for bad relationships.”

And having done many deals over many years, I can see where I have had a profitable and fun relationship when there are explicit expectations. And when there has been innuendo or ambiguity, relationships suffer because there is not a good agreement.

There are a lot of reasons bad deals happen. Sometimes it’s out of laziness on one or both parties. Other times, goodwill. I have made many of the mistakes and I am not one to keep repeating a script that doesn’t work. I want great relationships and have a lot of fun at it. Sure, there’s opportunities for making money, but I also enjoy people and life. Life’s too short to miss the fun.

So, if you’re like me and want to avoid the mess of unmet expectations or resentments that follow bad deals, then here are 4 keys I have learned over the years:

  1. Make sure the other party wins. We have too many options today and so does your counterpart in a deal. If you burn them or try to tilt advantages to your side, you may collect on a deal, but it will be short-lived. Playing for the long-term relationship and building trust and credibility have a much higher return. It’s why it is so important that when you take money, you deliver. Plain and simple. You have to think deeply about helping the other person win. This may include achieving a fitness goal, getting $100K in revenue or having harmony in their relationships. That win is the focal point of the deal.
  2. You have to put it in writing. Verbal agreements are extremely risky. How can you read between the lines or pick up intentions? Writing clarifies and clarity is your friend when building agreements. At a minimum level, exchange emails to clarify what is expected and what will be delivered. Outline what you have discussed, what items will be delivered and what the pricing will be for the venture or engagement. It’s good to have a back and forth and even a review of the details. This way nothing gets missed.
  3. Account for uncertainty. You can’t control or predict the future. What if something goes wrong? I don’t want someone hating me and I don’t want to hate someone either. Things do go wrong. Talk about those What If’s and get clear on what should happen. If the relationship is important, then make sure the other person knows, “Hey, who knows what will happen. But I want to maintain a long-term relationship. How can we make sure that happens if things don’t turn out the way we hope?”
  4. Celebrate. It was Socrates that said, “The unexamined life is not worth living.” I don’t get people that move on from one thing to another without reflecting and celebrating. How unfulfilling. When you celebrate, you are able to have a reward in the celebration itself. But it also sets you up for better agreements. The celebration allows you to have a case study of sorts. You can see how your partner sees the process and outcomes and tune in further. You also close the loop on your agreements by making sure there is no expectation left unmet. Winning is fun and celebration puts your wins in an explicit light.

I like finding good deals and getting to mutual wins. It has a compounding effect for business and life. I make more money and more friends in the process.

It takes leadership from you. Instead of playing things loose, you show respect for the other party by putting concerns, hopes, and goals on the table.

Imagine laying out the deals, agreeing to them, knocking them out and celebrating at the end. If you have a dozen of these experiences under your belt, deal making becomes habitual and your convictions on what you can deliver will solidify over time.

So how do you like making deals?

What I Like to Say Yes To

While I shared my thoughts about most things being a No in our working reality, there are plenty of people and opportunities to say Yes to. The key is to eliminate the noise and keep a self-discipline in allowing people into your life and business that drain you emotionally, financially and physically.

The cost is enormous to spend time on projects or attention-sucking efforts that keep you from moving towards your goals and getting results. Of course this means you are clear about your goals and what results you are seeking. So, that should be a first priority.

I spend a lot of time sharing ideas and seeking to help people. But if someone is not responsive or is drowning in chaos, it’s not worth trying to push or convince such people of the merits of taking action. Better to move on and find opportunities and people to work with that are easy and action-oriented.

The right Yeses get you closer to your goals. Here are a few to keep your eyes and mind open towards:

  • Action people. As I mentioned, these are the people I look for. They move ideas to actions quickly rather than linger, hope or remain in a state of unclear thinking. Action people have eagerness and execution as part of their behaviors.
  • Asymmetrical Upside. Finding deals where there is low downside and massive upside is not necessarily common. However, it’s well worth saying Yes to because of the risk equation. There are many deals that can be massaged towards asymmetry with creativity. The kind of thinking that is required has to be strategic and insightful in nature. I like massaging the details to create upside and mitigate risk. We can’t control outcomes completely but we can hedge to allow entrepreneurial pursuits to be worthwhile without foolishness.
  • More Options. Saying yes to choices with the most options keeps you freer than the person painted into a corner by limitations of choice. There are no guarantees. We don’t live in a world of complete cause and effect. We do live in a world of probabilities. You can tilt fate and outcomes towards your favor by using optionality for your own benefit. It’s a wonderful strategy that helps you navigate the unknown or compete in a world of too many choices.
  • Testing. Ideas are wonderful in that they are perfect in our mind’s eye. However, our minds are limited in what they can conceive as obstacles, adversity and limitations. I say yes to ideas that can be tested and moved along a path that works out the details. In the process you get insights, understanding and even skills that make your ideas workable and more robust.
  • Adventure. I hate boring. I know how easy our psyches can get comfortable and get stuck in a rut. We are not machines. We are human beings and we can experience more and live more fully by staying open to adventure that comes along. I like to say Yes at opportunities to grow, explore and have fun. It helps my motivation and opens up creativity and depth of experience. Those are so critical in a world of abundant choice and commoditization. Adventure helps avoid commoditization thinking.

What do you like to say Yes to?

Be Ready for Opportunity

Opportunity tends to be all around you. Have you ever thought that the people you randomly meet you likely have 5 opportunities together? But you have to:

  1. Care enough to listen carefully
  2. Understand what the other person is all about
  3. Match what you do with what they need
  4. Look for the convergence points

It’s too bad most people miss opportunities all the time. Often times I see the classic reasons why:

  1. They are always putting out fires
  2. They don’t use their downtime strategically to get ready. They waste it on meaningless activities
  3. They are not looking for opportunities
  4. They underestimate other people

You can’t control what comes in and out of your life. You can certainly increase the probabilities of who you will meet and what you will come across. If you move to Hollywood you greatly increase your odds of running into someone that is producing a movie. Move to Nashville and you will bump into someone in the music scene.

Artists understand they have to show up. And they work to be ready for that lucky break.

It’s no different in other sectors of life. We can fall asleep at the wheel by noticing or just going through the motions getting necessary or unnecessary work done. But the opportunities will come by us often without much fanfare or announcement.

What we can do is control our preparation and be strategic by being ready. Ready means you have your life together so that you can act when the time is right. Having your world together also keeps your mind at peace and you can see things beyond crises and distractions. You are elevated in your thinkings.

I always emphasize readiness by keep the decks clear. It’s a strategy that keeps my mind free from things that don’t matter and when opportunity does come, I can see it and move swiftly and precisely to engage.

How can you be more ready than you are?