Why You Shouldn't Let Middle Men Control Your Business Deals

This article delves into the common pitfalls of relying on middle men in crucial business transactions, emphasizing the importance of entrepreneurs taking the reins. It highlights how these intermediaries, while often valuable in their expertise, can inadvertently compromise your interests.

• Middle men often prioritize their own interests and long-term relationships, potentially prioritizing their comfort over your pursuit of the absolute best outcome.
• They might not have the same level of urgency as you do in securing the deal, and they might be more inclined to compromise on aspects that hold greater significance for you.
• They might not fully understand or appreciate the nuanced details of your specific business goals, leading to decisions that don't align with your vision.

The Importance of Being the Principal in Business Negotiations

The author emphasizes the need for entrepreneurs to be the main decision-makers in business negotiations. This involves actively participating in discussions, expressing your needs and objectives, and being prepared to push for your desired outcomes.

• Don't shy away from challenging the advice of middle men. Even if they have experience, you are the one most invested in the success of the deal.
• Always ask questions, gather information, and trust your instincts when negotiating.
• Be willing to take risks and potentially lose a deal if it means securing the best possible outcome.

Navigating Middle Men in Specific Business Contexts

The article explores the dynamics of middle men in various business scenarios, providing practical advice for entrepreneurs.

Real Estate Agents

• Don't blindly follow their recommendations. Be prepared to push for your ideal price and move-in date.
• Remember, their interests are aligned with their own sales and commission. They might not be as aggressive in negotiating as you are.
• Be ready to take a more active role in negotiations, even if it means waiting longer or risking losing the property. You might gain more in the end.

Recruiters

• While they are excellent at sourcing and screening candidates, they should not handle the final negotiation stage.
• It's crucial to have the direct conversation with your chosen candidate, assess their reactions, and make the offer yourself. You are the one who needs to be sure of this person's commitment to your company.
• Consider using independent reference check firms for senior-level positions. This can help you gather more unbiased feedback and avoid compromising your relationship with the candidate.

Lawyers

• Delay in negotiations and "lawyerly" arguments over minor details can be frustrating. To streamline the process, schedule a multi-hour "drafting session" with both legal teams and the clients involved.
• This ensures that everyone is on the same page, and commercial judgments can be made quickly without unnecessary back-and-forth.
• Don't let lawyers dictate the terms of the deal. You and your clients should be actively involved in negotiating and making decisions.

VCs

• VCs can be valuable partners in navigating investments, but don't let them control all negotiations.
• When raising capital or selling your company, you should be the principal in the negotiation, ensuring your interests are prioritized.
• Understand that VCs have their own interests, which might not always align with yours. Be transparent with them, and be prepared to push back when necessary.

Bankers & PR Firms

• These middle men prioritize their relationships with other clients and might not be as aggressive in your negotiations as you are.
• They can be valuable resources in gathering information and providing advice, but you should be at the table during negotiations.
• In PR, you should take an active role in pitching your story to journalists, ensuring that the message is aligned with your vision.

Embrace a Proactive Approach to Business Negotiations

The article concludes by reiterating the importance of entrepreneurs taking a proactive stance in business negotiations.

While middle men provide valuable expertise and support, your ultimate success hinges on your ability to be the driving force in shaping the deal. By understanding the motivations and potential conflicts of interest of middle men, you can navigate negotiations more effectively, securing the best possible outcomes for your business.