“Be patient." - Mark Raffan
Mark Raffan is the Founder & CEO of Negotiations Ninja, World-Class Negotiation Training Tailored to Your Needs.
Mark is an entrepreneur, sales and procurement veteran, podcast host, speaker, and recognized negotiation expert.
Mark has led c-suite negotiations for many years for a variety of companies and industries. Now running his own negotiations training company, Mark utilizes his extensive speaking experience to deliver engaging, usable, and market-relevant training to an under-served market.
He is the co-host of the two incredible podcasts Negotiations Ninja Podcast (one of the top negotiations podcasts in the world) and Content Callout (about B2B content marketing).
Mark is an expert in influence, persuasion, and negotiation and has coached executives and teams in some of the largest companies in the world, he has been referenced in Entrepreneur, Forbes, Thrive Global, and many other publications.
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Your liquidity event is the most important financial transaction of your life. You have one chance to get it right, and you better make it count.
But unfortunately, up to 90% of liquidity events fail. Think about all that time, money and effort wasted. Of the "successful" liquidity events, most business owners leave 50% to over 100% of their deal value in the buyer's pocket and don't even know it.
Our founders said "no" to a 7-figure offer and "yes" to a 9-figure offer less than two years later.
Don't become a statistic and make the fatal mistake of believing that the skills that built your business are the same ones for your liquidity event.
After all, how can you master something you've never done before?
Are you leaving millions on the table?
Learn how the 90-day Deep Wealth Experience and our 9-step roadmap helps you capture the maximum value for your liquidity event.
Click here to book your free exploratory strategy session.
Enjoy the interview!
[00:00:00] Jeffrey Feldberg: Welcome to the Deep Wealth Podcast where you learn how to extract your business and personal Deep Wealth.
I'm your host Jeffrey Feldberg.
This podcast is brought to you by Deep Wealth and the 90-day Deep Wealth Experience.
When it comes to your business deep wealth, your exit or liquidity event is the most important financial decision of your life.
But unfortunately, up to 90% of liquidity events fail. Think about all that time and your hard earned money wasted.
Of the quote unquote "successful" liquidity events, most business owners leave 50% to over 100% of the deal value in the buyer's pocket and don't even know it.
I should know. I said "no" to a seven-figure offer. And "yes" to mastering the art and the science of a liquidity event. Two years later, I said "yes" to a different buyer with a nine figure deal.
Are you thinking about an exit or liquidity event?
Don't become a statistic and make the fatal mistake of believing the skills that built your business are the same ones to sell it.
After all, how can you master something you've never done before?
Let the 90-day Deep Wealth Experience and the 9-step roadmap of preparation help you capture the best deal instead of any deal.
At the end of this episode, take a moment and hear from business owners like you, who went through the Deep Wealth Experience.
Mark Raffan is the Founder and CEO of Negotiation Ninja, a World-class Negotiation Training Tailored to Your Needs. Mark is an entrepreneur, sales, and procurement veteran podcast host, speaker, and recognized negotiation expert. Mark has led C-suite negotiations for many years For a variety of companies and industries; now running his own negotiations training company, Mark utilizes his extensive speaking experience to deliver engaging, usable, and market-relevant training to an underserved market.
He is the co-host of the two incredible podcasts. Negotiations Ninja Podcast, one of the top negotiations podcasts in the world, and Content Call-out, which is about B2B content marketing.
Mark is an expert in influence, persuasion, and negotiation and has coached executives and teams in some of the largest companies in the world.
He has been referenced in Entrepreneur, Forbes, Thrive Global, and many other publications.
Welcome to the Deep Wealth Podcast, and wow, do we have an episode lined up for you because I promise you this, when you listen to this, and you come out of it, you will never be the same again in the most positive of ways. Because when you think about it, success, both in business and life, it's not just showing up. Obviously, you gotta prepare, and that's what we're all about at the Deep Wealth and our nine-step roadmap.
But how well do you really present your point of view? How well do you negotiate? Are you negotiating? Are you just taking whatever's being given to you? Well, I'm gonna stop right there. No spoiler alerts because our guest, you heard from the official introduction, he is a thought leader, fellow podcast host. You can check all the boxes with what Mark does.
So, Mark, welcome to the Deep Wealth podcast, an absolute delight to have you with us. And you know what, Mark, there's always a story behind the story. So, what's your account? Mark? What got you to where you are today?
[00:03:35] Mark Raffan: Well, Firstly, thank you so much for having me. I sincerely appreciate the invite and I really appreciate being on. What got me going to where I am is my career's always been in sales and procurement and so negotiation has been a part of my life for as long as I can remember. I don't come from a conflict-averse family either.
My family definitely does not shy away from conflict. I've learned how to deal with conflict at a very young age, and it was something that I always felt comfortable dealing with, which is probably why I went to a career that allowed me to use that. And then a few years ago I started a podcast and a blog and that is the Negotiations Ninja Podcast, which is one of the most widely recognized negotiation podcasts in the world. And from that, a training company developed. And here we are today training some of the world's largest organizations, their sales and procurement teams on how to negotiate, how to persuade, how to influence, and how to resolve.
[00:04:38] Jeffrey Feldberg: Terrific. Mark. I have so many. It before we go down that path. And maybe it was just growing up in the family that you did, you said they were not conflict-averse. Haven't heard that term before, but it's intriguing. You know, I'm not sure if anyone wakes up one day and says, Geez, I wanna train people in negotiations.
I wanna get into negotiations. Was there a seminal moment for you that you said, You know what, I'm really good at this? I'm just gonna go, you know, start doing this, go out there and make a difference.
[00:05:04] Mark Raffan: Yeah, I think there have been moments throughout my life as well as my career where I've thought, hey, this is a skill set that I seem to be quite good at, I seem to be attracted towards. I love developing. I've read a ton of books around it. There were many times where I thought that was it for me, but it came to an interesting point in my career where I was generally disenfranchised with the large corporate outlook and have, always wanted to do my own thing started and failed at many businesses throughout my life. And this was the one thing that I thought, hey, I think I could give this a go. And it turns out that this is exactly what I was aligned to so it was interesting that it found me more than I found it I think.
[00:05:51] Jeffrey Feldberg: That's usually how it happens. And thank you so much for sharing that. Mark, why don't we start here? Because at least in, I'm gonna say North America, different parts of the world, it's viewed differently, but in North America anyways, for many people, you mention the negotiation word and it's oh. I can't do that, or you want me to negotiate?
That's just, that's not polite. I'm gonna offend the other party. So, can you help us change our mindset? We're gonna go on the art side of business here because mindset is often everything. What are we missing out on with that kind of mindset? What's going on here?
[00:06:25] Mark Raffan: Yeah, I think a lot of people fear negotiation because of a number of different things. I think the first thing is people fear rejection. And they fear getting the no from someone, and they often feel like if they ask for more in a particular circumstance or try to get a better deal, that the likelihood of rejection is significantly higher.
And that's justified because it is. There is a significant likelihood that you are going to get a rejection. And a lot of people fear that because of maybe some baggage that they've had in their past or psychological trauma that they've had around getting rejected at some point in their lives. Whether it was the first time they had a crayon drawing that they took to a loved one and said, hey, can we put this on the fridge?
And the loved one said, No, it's not good enough. Or maybe it was the first time they asked someone to dance at a school dance and that person said, No. Whatever it is for those people, there is something that we can often go back to as that first real visceral, emotional feeling of rejection. And unfortunately, unless you deal with that, you drag that around with you, that baggage around with you for the remainder of your life, and you get into situations where you know you should be asking for more.
But then that emotion pops its head outta the bag and says, Hey, the last time we did this, remember we got hurt so don't do this. Ask for something, quote-unquote, more reasonable, and then we'll get what we want out of it. And unfortunately, you end up negotiating with yourself before you even go into the negotiation.
And it's very dangerous mindset to be in that whole feeling and fear of rejection is quite common among a lot of people. And I think that's the primary cause why most people don't negotiate.
[00:08:11] Jeffrey Feldberg: And let me ask you this, just so our listeners can appreciate what they're walking into because you know, I know on the preparation side, when you're growing your business or you're thinking about exiting, ignorance is not bliss. Ignorance can actually kill the deal. Or even your business and so when we're going up against, call it, I'll use the word loosely, A colleague who's maybe even an adversary who is well prepared in the art and the science of negotiation.
What are we walking into when you get beyond the smile and the warmth of the person? Hey, Jeffrey, so nice to see you. Looking forward to working with you. We're gonna do great things together, but they're really prepared. They are a masterful negotiator. What are we walking into? What should we know?
[00:08:56] Mark Raffan: You're walking into a bloodbath, you're going to get wrecked. You are going to get destroyed in that negotiation, and I think there is this unfortunate mischaracterization of negotiations where sometimes people believe that the counterparty is going to be fair, reasonable, and rational with you.
[00:09:18] Jeffrey Feldberg: Okay.
[00:09:19] Mark Raffan: That may not necessarily be true.
Now, you may leave the negotiation feeling like they've been fair, reasonable, and rational with you. But there's a big difference between that and the reality of the situation. And if you go into a negotiation where someone is very well prepared, has done their homework, knows exactly what they're trying to achieve, understands what you even might be trying to achieve, and you've done no work to get to that point, you're gonna feel great most of the time walking out of that deal because you will have no idea what success even looks like for you.
Because you've done no planning and preparation so you're gonna walk out going, Hey, I got a deal. Is that a good deal? Or did all of the value just get extracted by the counterparty and you just feel grateful for having a deal done in the first place?
[00:10:10] Jeffrey Feldberg: And you know what, Mark, let's pause there for just a moment because in our world here at Deep Wealth, that's exactly what happens. And for the listeners of the Deep Wealth podcast, you know, the stats up to 90% of liquidity events fail. And Mark, to your point, for the quote-unquote, successful liquidity events, business owners unknowingly are leaving 50% to over 100% of the deal value in the buyer's pocket.
Then they're ignorant to that. And so it sounds like this is really a common theme in the world of business. When you're just showing up, you're not prepared, you're leaving a lot of money on the table.
[00:10:44] Mark Raffan: Yeah, certainly. And with regards to that, the business owners that we work with and the entrepreneurs that we work with routinely after training go, I cannot believe how much money I have lost and how much value I have left on the table as a result of just not picking up a book to learn more about negotiation or not taking a class to learn more about negotiation.
And it's shocking to me as someone who is also a business owner, but at the same time also not shocking. You're busy, you've got a ton of things going on. You're trying to build a business. You're probably focused on the top-line end of that conversation. You're focused on revenue building a ton and you're focused on managing the operations a lot of the time and quite often you don't think of the sale of that business as something that is a revenue generator, and that's a strange thing to think about when you're a business owner because you think, Okay, this thing, this business is a vehicle that generates an income for me, which is fantastic. And then hopefully I can Exit at some point in time, and that hopefully mentality leads you to not plan and prepare, and that means that you're not ready for those negotiations.
You haven't done all of the work that I know that your system does to get you ready for it, and then you end up leaving too much value on the table.
[00:12:10] Jeffrey Feldberg: And so, let's start diving into this. And the first thing, let's address this Mark is someone who's saying, Okay, you know what Mark, hearing you, I'm walking into a blood bath if I'm not prepared, and I'm leaving all this money on the table. Okay, got it. I get that and I can feel the pain of that, but the thought of me being the one to negotiate, I'm just thinking out loud here, Mark, you know, maybe that's not my personality or I would never know how to do it.
Why is that not the case? How do we stop that kind of thinking to get really the word out there that yes, you can do it, many people do, and you're really more powerful than you think?
[00:12:44] Mark Raffan: Yeah. And that last line that you had is really the key point. You're significantly more powerful than you think you are. Negotiation like is a skill set. The more that you read and apply and practice for that skill set, the better you are going to get. Right when you first started your business and first started selling in your business, you didn't get instantaneous success in sales.
It took time to be able to develop that skill set and develop those sales. The same thing is true for negotiation. The more that you practice it, the better you're going to get. And so, for those people that are thinking to themselves well, my personality doesn't align with negotiation because maybe I'm an introvert and I don't like talking to people all that much and having those kinds of conversations.
That's a very detrimental mindset to be in, and I will tell you for the introverts that are listening right now who maybe are afraid of those types of conversations, the very best negotiators I have ever met have all been introverts.
[00:13:47] Jeffrey Feldberg: Interesting. Why do you think that is? Any thoughts on that?
[00:13:49] Mark Raffan: Because they are great at listening. They are amazing at listening to what the counterparty is saying, but more importantly, they're good at listening to what the counterparty is not saying.
Sometimes when we ask questions, the counterparty sort of gives us these roundabout answers that don't really fulfill the intention of the question.
Introverts are great at picking up on that and diving deeper into the curiosity of why didn't you answer that question what's actually going on here? And when you can get beyond the position of the counterparty, that's when things start to get interesting.
[00:14:22] Jeffrey Feldberg: Okay. So interesting of what's not said oftentimes can tell you more than what is said. And so let's start going into some of these strategies now, and so you've already started to talk about that, and let's again, start dispelling some myths. For starters, good old Pareto's law 80 20.
The 80-20 rule where 80% of the mistakes that most people make are probably coming from 20% of the actions or inaction, so,, when it comes to your world, Mark, with negotiations and business negotiations in particular. What's going on? What are some of the more common, I'll call them fatal mistakes that as business owners, we unknowingly or maybe knowingly are making
[00:15:03] Mark Raffan: Yeah. I think the single biggest mistake that most people make in their negotiations is not knowing one of the what they want to get.
[00:15:09] Jeffrey Feldberg: Okay.
[00:15:10] Mark Raffan: They go into negotiations to see what they can get out of the negotiation, and they're kind of winging it in their negotiations. Well, I'll just see what I can generate.
That's a common thing that a lot of people say that's a mistake because there's no way to be able to determine whether or not you've been successful so, before you go into a negotiation. First, write down, as simple as it sounds, write down. What are the things that you want to get out of the negotiation?
Now, when I hear people answer this question, sometimes they answer it with what we call aspirational goals. They'll say things like I wanna make money, or I want to reduce risk or something like that. That's very general and broad.
[00:15:55] Jeffrey Feldberg: Okay.
[00:15:56] Mark Raffan: That's great. That's an aspirational goal, but those are not negotiable items.
So, what most people should be doing is breaking down those aspirational goals into something that we call success drivers. So, what are the drivers that drive the successful outcome of that aspirational goal? so, if, for example, you wanted to make more money, What goes into making more money? Does it mean increasing your prices?
Does it mean selling more of the thing that you sell, like more volume? Does it mean cross-selling additional items? Does it mean asking for additional referrals? It could mean a number of different things that you're doing in your negotiation, even when it comes to selling your business. If you want to get more money for your business, what are you going to do?
What are the things that are negotiable items to get more money? Out of the sale of your business. Once you can define those things, then you're significantly better prepared to go into the negotiation.
[00:16:57] Jeffrey Feldberg: And so, for our listeners, what we're hearing Mark say in the Deep Wealth world, this is what we call Mark, are deal points and no-fly zones of what must absolutely be in the deal that if it's not there, I'm walking away. Or on the flip side, what don't I want? so,. If something is there, you know what? I'm just not gonna do it.
I'll find an alternative. Or if I'm in a liquidity event, I'll find a different buyer. So, really same principles. Here is what do you want. And it can't just be, I wanna make a lot of money. You're saying Mark, define it. Put some numbers to it. Make it very specific so there's no guesswork here.
[00:17:29] Mark Raffan: And something that you said was very important, determining where you might be willing to walk away from a deal. That's what a lot of people don't do as well. And so what ends up happening is because they don't know where they want to walk away, they haven't defined that line in the sand so, to speak.
They end up making deals that are far less profitable and sometimes even really damaging to their business or to themselves because they get wrapped up in the emotion of the deal. I see this quite often with startup founders who are going out for equity in their raises. So if they're doing a series A, series B, series C raise, whatever it might be, sometimes they get so, wrapped up in the idea of getting that money that they end up giving away far more of the business than they probably should.
And then they end up being in a situation where they're now working for someone else in their business.
[00:18:25] Jeffrey Feldberg: It's really what a buyer on the Deep Wealth Podcast, we have many buyers that come on, but they all say more or less the same thing. And they say You know what, Jeffrey? When we smell blood in the water. If there's fear, if there's desperation, all bets are off.
If we had one value that we're going in with, not gonna happen. We're gonna go in for a value that's even lower. That's better for us because we can detect the blood in the water. Now we're the sharks. We're gonna go in and just do what we do best. And it really, I'm hearing the same thing from you, so, mindset and knowing you have options is everything.
And you, I guess you just can't have desperation. Now, how do I avoid that as, you know, someone walking in, I don't know really what I'm potentially up against. How do I not come across as desperate? How do I know that I don't have to do this?
[00:19:08] Mark Raffan: Yeah, I think a lot of it comes down to practicing our word in the negotiation world is called roleplaying. We role-play for the negotiation before we even go in so that we come off acting more confident than we maybe feel in that kind of a situation. And that's really important to show that confidence.
But a big source of reducing your desperation is ensuring that you have alternatives. And I'm sure that you advise this in the business sales world is to make it competitive, so when you're going out to sell your business, you are hopefully going out to more than one party at a time.
Because if that party finds out that they are the only one competing on that business, You're screwed. There is no other alternative. There's nowhere to walk away too. And I think that's a lot of things that one big thing for sure that a lot of people don't consider is they may even define where they're willing to walk away, but if they decide to walk away, the question then becomes where to, where do I walk away to after I've decided to walk away?
And that's a function of not having alternatives.
[00:20:16] Jeffrey Feldberg: And all you listeners out there, you're hearing it from Mark, you've heard it from us, and in our world, Mark would call that an unsolicited offer. You get a knock at the door. It's only one buyer. It's the absolute worst thing that you want to do. So, Mark, what I'm hearing you say is before you enter that room or that virtual room or that phone call, whatever the case may be, make sure you have other alternatives, other options that as bad as you may want it to be here, you know that you have some other alternatives.
If things don't work out.
[00:20:43] Mark Raffan: Yeah, certainly having those alternatives is really the key to a lot of your confidence in the negotiation. And then also show that confidence. I mean, I feel like confidence is one of the things where the whole fake it till you make it really does apply because the more confident I act in a negotiation, then you perceive me as someone who is confident, which means you're gonna treat me as though I am confident, which therefore makes me feel more confident.
So it's a communication feedback loop of acting confident in that kind of a situation. So, the more confident you act, the more confident you will be treated. The more confident you will become.
[00:21:23] Jeffrey Feldberg: And so, for our listeners. Once again, a very subtle point, but an important one, really, it's the perception. You may be trembling and quivering on the inside, and you're nervous, but to the outside world, hey, yeah, I got this thing done. You know what, if not you, I've got 10 others lined up that I'll speak to so either we'll get to something or we won't. That I'm hearing the confidence or the perceived confidence. Mark is really key.
[00:21:47] Mark Raffan: Certainly much of negotiation tactically is about managing the perception of the counterparty, managing their perception about the value of the deal, managing their perception about you, managing their perception about themselves and their position within the deal. A lot of that comes down to managing perception.
[00:22:04] Jeffrey Feldberg: Got it. Okay. And so where do you draw the line of I can just imagine, Mark that I can be confident, but I can come off as arrogant and in the wrong way and actually, unintentionally offend people. So how do we, or where do we draw the line?
[00:22:20] Mark Raffan: it's a good question, and I think I separate the two quite substantially. I think there's a major difference between arrogance and confidence.
[00:22:30] Jeffrey Feldberg: Okay.
[00:22:31] Mark Raffan: For example, let's, we'll all do an activity together. All the listeners right now, I want you to think of the most arrogant person you've ever seen in your life.
Could be a media personality, could be a political figure, could be a movie star, Could be someone personally that you know, think of that person and think of why you think they're arrogant, most likely when you see that person, they appear disinterested. They don't do any kind of eye contact with you. They tend to lean back in their conversations and are not engaged.
They maybe tend to talk over people and don't listen. Now, let's contrast that with someone who is confident. Think of the most confident person, again, media personality, politician could be anyone.
Now let's think of those characteristics. They make eye contact, which is the opposite of what we said before.
They are interested, they are engaged, they have great posture. They lean into the conversation. They listen to what you're saying, which is almost the exact opposite of the arrogant person, so, if you are one of those people right now that says, Okay, Mark, I'm afraid that if I act too confident, I'll come off as arrogant.
There is a long way to go before you get to arrogant. So, just as long as you're showing those unique and engaging characteristics of a confident person, you're gonna be fine.
[00:23:56] Jeffrey Feldberg: Yeah, Mark, correct me if I'm off base here. It really sounds like you're just showing up. You're prepared, you feel comfortable with that. You got really nothing to prove. You're there to get a deal done and you're curious what the other person is saying. You want to be attentive. You wanna be polite, you wanna listen, and when it's time for you to make your move, you'll make your move, but you're not gonna be going outta your way to prove anything.
In fact, it's gonna be the opposite so, that you're, really coming in stealth mode and flying under the radar. Would I be on base with that?
[00:24:25] Mark Raffan: I think you're entirely correct. Something you said that I think is very important. There is lack of something to prove, which is generally a function of keeping your ego in check so, often in negotiations, we let our ego get the best of us because it's about the outcome of the negotiation as opposed to the direct and contemplative steps to ensure that you get a great negotiation.
An ego-based person thinks of the outcome. They think I'm gonna get all this money. I'm gonna get this deal. A good and focused negotiator thinks to themselves, What are the things that I need to do to ensure that I'm as successful as I can be within this negotiation, forgetting about the potential outcome that may come, the outcome is gonna happen regardless.
Either you're gonna get the deal, or you're not gonna get the deal. But what are the steps you're gonna take to ensure that you're gonna get there? That's what a good negotiator does, and they manage that ego so that they don't think too much about the outcome. Because the reality is, and this is the same in poker as it is in negotiation, you don't really have all that much control over the outcome.
You have control over the actions that create an outcome, but the outcome is going to happen. So work on the actions, work on the habits, work on the planning, and then the outcome will have a higher, significantly higher probability of being in your sale.
[00:26:01] Jeffrey Feldberg: Terrific so Mark, let's change gears here a little bit. We've talked about some things to do, some things not to do. Let's set this up in the following way. So, I'm a business owner. I'm hearing you talk, and you know what, Mark's got a thing or two to say, I could really benefit from this. Forget my liquidity event.
I could use this right now for my business and start negotiating better deals. So, I show up, Mark, and I'm gonna go through your training, through your system. Can you walk us through what does that look like? How long does it take, and what are we doing?
[00:26:30] Mark Raffan: It really depends on the kind of gaps that you've seen with maybe within your organization or within yourself where you wanna get better. If you just want to generally layer up your negotiation skills, our seminole program is called the Negotiation Success Program, and it's a three-day virtual program where you would learn negotiation strategy and negotiation tactics.
The first two days are all about strategy, and it's four hours per day so you get into understanding, planning, preparation. How to write out a list of things that you want to achieve, How to think about what the counterparty may want from the negotiation, what kind of questions you're gonna ask, and then on day three, you think about how do I ask for more?
How do I say no? How do I manage my body language? How do I change my tonal inflection to maybe get a different result? That's our most popular program.
[00:27:23] Jeffrey Feldberg: And so obviously, you know, we're not gonna cover all of that in the short period of time that we have today, but if you were to look at it again, let's flip it now. The 80-20 rule, what would be 20% of the strategies that we have available to us that really get us 80% of the results? so if we only knew a few things.
You know what? Here is my go-to, whatever, 1, 2, 3 strategies, but it's gonna help get me results.
[00:27:47] Mark Raffan: Know what you want, which we talked about earlier. But tactically, I think the single biggest thing you can learn how to do is learn how to ask for more not just ask for what you think is gonna get the deal done, but ask for more. Most people go into negotiations asking for what they think is going to expedite the deal, meaning make it go faster.
There's a big problem with that because the counterparty is going to negotiate with you anyway, which means if you ask for what you think is gonna get the deal done faster, you are still going to get a counteroffer based on what you've offered.
Which means that you've now reduced the range of potentially valuable things that you could get out of the negotiation so instead of doing that, ask for more than that so that you can generate more value. The second biggest thing tactically that you can do is manage your concessions so, for example, if you said Mark, I want you to drop your price by 15%, I might say to you, Jeffrey, I might be able to do 3%
And if I can do 3%, can you do?
And then I ask for something in return. Now, this is concession strategy, sorta 1 0 1, first layer of concession strategy. Always make your giving conditional on getting something in return.
Second layer of concession strategy is portional giving. If you ask me for 15%, I'm not gonna give you the full 15%.
I'm gonna give you a portion of that 15% and I'm still gonna ask for something in return. And the third layer is I'm gonna manage your expectations around the scarcity of what I have to give away. I wanna create scarcity around the concession to make you believe that it has more value, you're gonna feel better when you get it so that you feel great when you leave the negotiation.
Those are the big things I need think people should focus on.
[00:29:46] Jeffrey Feldberg: So someone who's prepared, they're walking in, they've got this mapped out. Well, I don't know exactly what the other party's gonna be saying, but if they ask for some kind of a concession, I'm gonna come back with this so, they've already thought it through. They're not having to think off the cuff.
I would imagine, based on what you're saying.
[00:30:02] Mark Raffan: Correct. Yeah. Identifying what you might be willing to give away. Keywords might. Just because someone asks for it doesn't mean you have to give it away, but you do have to determine prior to going into the negotiation what you might be willing to give away. Because if you don't know that ahead of time, generally speaking, we end up giving a lot more than we should in that negotiation.
Knowing what it is that you're willing to give away and knowing what portions of it that we're willing to give away is really critical.
[00:30:31] Jeffrey Feldberg: Mark, let me ask you this. Let's get away from the number, so it doesn't make it complicated. Let's just use an index. And for the index we'll use an index of 100 and 100, It could be a dollar, it could be a thousand dollars, it could be a million dollars. It could be anything in between. And so let's just say that fair value is a hundred for the index. So are you saying when we should be asking for more so if I want to charge someone, I want someone to pay me something? Are you saying that I should go in there and not go in at the a hundred, which I feel is fair market value, but I should go in at a hundred and twenty, a hundred fifteen, a hundred and thirty, Is that what you're suggesting?
[00:31:07] Mark Raffan: Yeah, there's a great rule of thumb in negotiation theory called bracketing, so let's say, for example, the fair market value of what you're saying is that a hundred, and then I know, I think I'm likely gonna end up at, let's say, 95, the delta between ninety-five and a hundred is five so I would add that on to the top of the fair market value of a hundred, so I would ask for one zero.
That's what we mean by asking for more.
[00:31:35] Jeffrey Feldberg: Okay. So you're picking a best guess at the time and coming in, you're making sure that you're not being two out there or too little is just, I guess the Goldilocks is just the right amount that's gonna be enough to keep you in the game.
[00:31:48] Mark Raffan: The question I often ask people is, they may go into a negotiation and ask for fair market value
Then I asked them what is the likelihood of you getting that fair market value now that you've asked for exactly that fair market value?
[00:32:01] Jeffrey Feldberg: Okay.
[00:32:02] Mark Raffan: Almost zero, the counterparty is going to counter the likelihood of you getting that hundred is pretty close to zero.
Now, what if you asked for 1 0 5?
Now, what is the probability of you getting that fair market value significantly high? So, by asking for more, you're increasing the probability that you're going to get the thing, as Wayne Gretzky said you miss a hundred percent of the shots. You don't take.
[00:32:24] Jeffrey Feldberg: That's right, and so, really, it sounds like the art here. It is more art than science is having a realistic baseline in the first place. That's probably something that you can't necessarily help with, but having that realization, hey, you know what? If I'm gonna come in too high, it doesn't matter if that hundred is too high, that index of a hundred is too high.
If that index of a hundred, it should normally be, I'll make up these numbers, a hundred thousand. But I'm saying it's really 200,000. It doesn't matter if I'm coming in at 105, hoping I'm gonna get to a hundred. Never gonna happen in that instance. And it's not necessarily your purview, Mark, but I'm sure you've seen, and we see this all the time, if I'm selling a home as a homeowner, I think it's always worth more than what market is so, how do we keep ourselves in check when we're heading into negotiation, just to keep some reality in there.
[00:33:15] Mark Raffan: Data. I think that's the single biggest thing that you can use to check your emotions, especially with things that are emotional, like selling a business or selling a home. It's your business is your baby. I get that. And you think that your baby is beautiful, but it may turn out that your baby, on average, when compared to other babies, is as valuable as the other babies that are currently on the market. Not more valuable. Which means that you have to be able to say, Okay, objectively, where am I actually valued here? Which is why it's so important to work with someone who does this on a regular basis. Because if you don't do this on a regular basis and you look at the market, and you can immediately go my business is worth way more than that business.
What is it that drew you to that?
If it's just a feeling that you have, that's probably not a good way to go into a negotiation. We want to try and objectively measure it as best we can.
[00:34:19] Jeffrey Feldberg: Sure. Hey, you know what's interesting here, Mark, In the Deep, Wealth, Experience, when it comes to selling a business, it's obviously, it's a negotiation. We view it as a different type of negotiation, and we encourage the business owners to get professional help in most likely an investment banker or who's a bit of a smaller business, a broker, but what, we're not selling a business,, and we're just doing a business negotiation.
Really what it sounds is not only getting your numbers in check, but you better show up with what we call the narrative. It's step number three of our nine-step roadmap. Before you speak to your future buyer, before you speak to your future investment banker, as an example, or your advisors at step number six, create a compelling narrative.
That gets people excited of why you're different. Why you're it over everyone else? Exactly. And so based on what you're saying, if you're having all these asks and you're gonna be above market, you better have the story behind that to justify it. Am I hearing it that right?
[00:35:17] Mark Raffan: Correct. You need to be able to communicate the value of where you differentiate. So, if we're gonna do that baby conversation again, and you said well, my baby is worth more, I'm gonna ask you, like, why. What's the story behind why it's more valuable? If we can sell that story, if that's compelling, and you can show me where the evidence might be, even if it's anecdotally,
That gives you significantly more leverage in the conversation.
[00:35:45] Jeffrey Feldberg: Got it. Okay. So, it's all coming into line here. And so, we're now going through this. Mark, you're walking us through, and you're sharing some of the more powerful strategies of what's there. But again, when we're new to this, and we're not someone like yourself, you do this, heck, you teach this, you wrote the book on it, and you know you're helping people worldwide with this.
Even though we're prepared, we're now walking in, it's the day off, and we get into that room, and oh boy, we feel the nerves, and maybe we go blank. Yeah, I had everything lined up, and gosh, what the heck am I gonna say? And imposter syndrome. I mean, I can just go on and on with what happens, but how do we mentally prepare ourselves for the big day of not falling into that trap and sticking to the game plan?
[00:36:29] Mark Raffan: Assuming you've done all of the planning and preparation going into it. I think the biggest thing that I could recommend on the day of, as strange as it might sound, is eat, depending on the time of day that you're doing this, eat a light breakfast. Don't do anything too heavy in terms of the breakfast that you're gonna have.
Get a workout in and maybe get some meditation in before you go in because you need to be able to set your mind in the right direction for that negotiation. And if you are properly fed, and if you have done a workout, if you've gone in and you've primed yourself with a meditation about what you're gonna do, you're gonna really improve the probability of success.
But let's say you get in, and you immediately go blank. You don't know where to go from there. Take a pause, take a time out, go to the bathroom, and just say, can I use your bathroom? Can I use your restroom? Go to the restroom, see if you can reintegrate with yourself. See if you can reestablish where you are.
If you cannot, If the nerves are too insane. If they're too crazy, you think you can't do it, just say, I'm not feeling very well. Can we postpone towards another date? I know it's not convenient for you, but unfortunately, I'm not feeling very well. It's gonna be a much better strategy to do that and come back when you're feeling like you can handle it than if you or in a flustered situation and you start saying things you know you shouldn't say, but the likelihood of that happening, if you've planned and prepared properly, is very low because you will have all of your notes in front of you. You'll know what the first few things you are gonna say is. You'll be able to get into that going pretty quick.
But if you haven't done that, you take that time.
[00:38:11] Jeffrey Feldberg: What I like about that is you're really telling the truth. Hey, I'm not really feeling so, well, at the moment, and I know it's an inconvenience, but can we postpone instead of trying to be the unsung hero? Well, you know, I'm here. I probably should just go through it. I don't want to be an inconvenience to anyone.
And it's really like they say when you're flying an airplane, if the mask falls down, put it on yourself first before you help the person beside you. So, look after yourself first and foremost, and everything else will hopefully fall into place. But let me ask you this, it brings up an interesting point, when I'm thinking about the negotiation, and I'm thinking, Okay, is it gonna be just me or do I bring a colleague with me or do I have a team with me?
How do you look at that? When is that appropriate? When is that not?
[00:38:56] Mark Raffan: It's very appropriate, and I think having a negotiation team often generates better results than if you don't have one. I would say there's really four members that you should have on your team at any point in time, especially for a big emotional sale or an acquisition.
There should be a negotiator so generally, that's per someone who's doing the talking and asking the questions. That could be you, or it could be someone that you designate, so, let's say, for example, you have a banker that you're working with, that could be a banker that you designate. Then there's gonna be someone taking notes. That's generally what we call a scribe, or the project manager of the negotiation, so that person is taking minutes on what's being discussed, what's been agreed to, what hasn't been agreed to, what the deliverables are for certain things, who's responsible for what, and really just managing the negotiation on an ongoing basis. The third member of your team needs to be someone who is an observer.
This is someone who watches and listens, someone who watches for body language cues, listens to what's being said and not being said like we talked about earlier. And then the fourth member of your team isn't gonna be present within the negotiation, but there's someone that you go to for support, so a mentor, an Advisor, someone like that, that you can go to and say, hey, I think we're stuck.
Or, This is where we are in the negotion. Where do you think we could go from here and having that support that is maybe giving you that 30,000 foot viewpoint is really critical, especially for something that's maybe emotional to you.
[00:40:30] Jeffrey Feldberg: And at Deep Wealth, when at least it comes to a liquidity event. We call that a Chief Exit Advisor. We coin that term. It's someone who's not at the deal table. Knows all about deals, and it's like a board of directors of one who's there to support you. But in this case, it can be, like you said, a coach, a mentor, someone who's just got a lot of experience.
And how do you balance that though, Mark? So, I can just imagine we're showing up with three or more people potentially, and if it's a physical meeting, we walk into the room, and it's just the one person over there. I mean, Isn't that a little bit overwhelming? How do we?
[00:41:02] Mark Raffan: Yeah, I would prep that person beforehand, prior to going into the meeting, I would communicate with the counterparty to say, hey, we'll be coming in with this team to be able to have that discussion. There'll be three to four people that'll be coming in with me. If you decide, please also bring in a few other people.
If you wanna handle it on your own, that's great. But we will be coming with this amount of people.
[00:41:23] Jeffrey Feldberg: Okay, so you're giving the heads up, and let me ask you this, You know it's a different world now than it was three years ago. Societal norms have changed, and social norms have changed vis-a-vis the pandemic, and we have a lot more virtual than we ever had before. And I know in mergers and acquisitions this has been an absolute game changer in terms of how deals are done, and there's positives and there's negatives, like with anything else.
Mark, in your world, in the world of negotiations, what has changed today that perhaps two years ago wasn't there that we should be knowing about?
[00:41:54] Mark Raffan: Virtual negotiations are significantly more common. Common already, but now are almost ubiquitous, and I think a lot of people fall into this false sense of security with virtual negotiations because, for whatever reason when there's a screen in front of them, they believe that they're not as being seen as if they were in person.
That's really dangerous. I mean, we've all seen news broadcasts where, you know, backgrounds or events have caused the nude broadcaster incredible embarrassment, and we don't want that to happen. So, remember that just because you are in a virtual situation doesn't mean that you're not being watched.
If I might, I could give a few tips around virtual negotiations, I think would be beneficial.
[00:42:39] Jeffrey Feldberg: Yes, absolutely.
[00:42:40] Mark Raffan: Number one is camera placement. Make sure your camera placement is really good above the desktop that you're looking into.
Do not use your laptop camera. It's not flattering, and it doesn't create the perception that you want the counterparty to have of you.
Remember, all of this is about managing perception. So, make sure that you pick a viewpoint that is the most flattering for you.
[00:43:03] Jeffrey Feldberg: And so, mark, what are you saying that the notebook camera that has just the perfect angle on my nostril and my nose, and just kind of going right up there? We don't want that. Is that what you are saying?
[00:43:12] Mark Raffan: No, yeah, we do not want that. We do not want, Yeah, like no one wants or needs to see the double chip. Right so make sure that the cam replacement is generally pointed down toward you. Not too high, but slightly higher than your eye level so that when you're looking into the screen.
It looks like a really good shot. The next thing is lighting. Don't hide in the shadows. Many people are doing their negotiations in the dark, and it looks shadowy. And generally speaking, we don't think very highly of people who hide in the shadows. We often think they're up to no good. Remember, we're trying to create a perception, so make sure you've got good lighting.
It doesn't have to be natural light, but just something that at least shines in the room and lights up your face so that you don't go into a negotiation where it looks like you're in the dark. And then obviously audio and video that comes with that too.
[00:44:01] Jeffrey Feldberg: Well, Mark, let me ask you this. I mean, depending on the negotiation here, I'm just thinking spending a few hundred dollars on lights and getting the right camera, I mean, that can make the difference. So you're coming off professional and prepared, and confident. I mean, Gosh, I would think that would just be a rounding error relative to the value that you're gonna get.
[00:44:19] Mark Raffan: Yeah, invest in a camera, a hundred bucks can get you a phenomenal camera. Invest in a ring light. Just put that in front of you. That's really cheap and easy. Make sure that you set up your camera properly, make sure that you have good audio, and you can actually hear and speak to the person.
And if you can, as maybe like a final tip, curate your background as best you can. Don't do it where people can maybe see into your kitchen or into your living room or into the kids play area if you can try and curate your back. That's always best. Now, when I say things like that, people say people shouldn't judge me based on where I am.
You're right, they shouldn't, but they do so, if they're gonna do that anyway, you may as well curate for that.
[00:45:05] Jeffrey Feldberg: Exactly. Hey, you're not making up the rules. You're just the messenger on this. It kind of is what it is in terms of what goes out there, but really, Mark, what I'm hearing you say is you can be really well prepared, even have the best team with you, have all the strategies lined up.
You've done your homework, but if it's virtual, and you're in dark lighting and the camera is right up your nostril and all those other things, I guess you're losing that credibility that at one point to another, you're gonna suffer because there's so, much that's nonverbal in the first millisecond we see someone, boom.
We make assumptions already.
[00:45:37] Mark Raffan: That's correct.
[00:45:38] Jeffrey Feldberg: It sounds like it's been a game changer, just virtual for the types of negotiations that are going on.
[00:45:43] Mark Raffan: Yeah, certainly. I think virtual also in some areas, gives us a significant advantage because, in a virtual negotiation, we get video feedback of ourselves like in a face-to-face negotiation. The only feedback I'm really getting are the expressions that I see on your face.
But in a virtual negotiation, I get to see the expressions on your face, and I get to see my face, which means that I can change how I approach the conversation really quickly and start shaping my body language and my facial expressions to move it in a different direction.
[00:46:16] Jeffrey Feldberg: And Mark, when would it be not appropriate to do virtual? What kind of negotiation are we saying? You know what? Virtual is very convenient. We can save time, we can save travel costs. We can save money if it's not gonna be locally in town. But in this one instance, virtual's not the way to go.
Is there a general fast rule, hard and fast rule that we're saying?
[00:46:39] Mark Raffan: Think it really is relative to the risk and the value of the negotiation. If it's a high-risk, high-value negotiation, I would almost always recommend that you do it in person. I mean, in a perfect world, I'd love for all negotiations to be in person, but at a certain point, you have to designate the risk and the spend or the acquisition level to be able to decide when you're gonna meet in person, if it's high value enough for you keywords for you, you should be meeting that person in person. And if you can, if you're going to do that, try and meet them on neutral territory. Cuz if you fly to their location and meet in their office, oftentimes we have the feeling of being out of sorts when we're in someone else's location and vice versa. If they fly to you, for example, you're gonna have the upper hand. What I like to recommend is a neutral location. Generally, you can rent out a hotel meeting room, for example, for a few days for you all to go in, sit down with your council, make sure you've got your advisors there, and hash out.
[00:47:44] Jeffrey Feldberg: That sounds all reasonable. And the last question before we start wrapping up, if it's gonna be in person or maybe even virtual negotiations, start the moment both parties are in the room, so, even before you sit at that table, I would imagine, it's already begun with what we say, what we don't say. Any tips for us in that quote-unquote, small talk before we sit down and get things going of what we should be doing or not doing?
[00:48:10] Mark Raffan: Yeah, do not discount the value of small talk. Small talk is very, very valuable, especially if you can create something we call an attention tunnel to drive the focus of the conversation.
For example, the media for many years has known that it cannot change your mind about something, but it can change what you look at to change your mind about something.
We can use the same kind of idea within the small talk conversations that we have to create a focus for you in that negotiation so for example, if I'm sitting down with you, Jeffrey, and we're just having small talk about, you know, sports teams, kids, family, all that kind of stuff that comes along and maybe we're having a dinner together the night before, and we're talking about things, one of the questions I might ask you is, Jeffrey, do you consider yourself a collaborative person?
Now, that may seem like an offhand question that's in the middle of the conversation. But it's very well placed because I am creating an attention tunnel for you so, that the next morning when I say, Hey, we're all about collaboration here, you're starting to be more collaborative with me, share more information with me, and now I'm becoming more successful in that negotiation. so don't discount the value of that small talk.
[00:49:34] Jeffrey Feldberg: Interesting. That's a whole rabbit hole we can go down even paying a compliment. Oh, Mark, so nice to meet you. You know, we've been speaking for a while, and you just seem like someone who's very agreeable, someone who really knows how to do so well around people and make things happen and just cooperative.
I really appreciate about that, and I'm really looking forward to working with you, so now, you're not gonna say no, Jeffrey. I disagree with everyone. I'm a difficult person to do that. so, It's interesting what you're saying. Mark, listen, I could ask, tell the cows, come home, all these different questions.
You've been very gracious with your time. We are bumping up into time, so, let's start to do our traditional one, thought experiment as we wrap things up. And here's what I'd like you to think about so, think about the movie Back to the Future. And in the movie, you have that magical DeLorean car that will take you to any point in time.
Mark, it's tomorrow morning you wake up, you look outside the window and there it is. The DeLorean car. It's not only sitting there curbside, the door is open, it's waiting for you to hop on in so, now, you go in and you can go to any point in your life. Mark, as a young child, as a teenager, whatever point in time it would be.
What are you telling yourself in terms of life wisdom or lessons learned or, Hey Mark, do this, but don't do that. What does that sound like?
[00:50:48] Mark Raffan: I would probably go to my late teenage early adolescent years.
[00:50:55] Jeffrey Feldberg: Okay.
[00:50:56] Mark Raffan: and I would tell that guy to be patient.
[00:50:59] Jeffrey Feldberg: Ah, okay.
[00:51:01] Mark Raffan: Patience has not been a strong suit of mine. And something that I've really had to work on and I'm still working on so I think I would teach that guy about patience
[00:51:11] Jeffrey Feldberg: Words to the wise, be more patient, give it some time that's really something. And particularly for negotiations, I would imagine patients can either lose the day, lack of it, or win the day.
[00:51:22] Mark Raffan: very much.
[00:51:24] Jeffrey Feldberg: Terrific. Well, Mark, we're gonna put this in the show notes. If someone would like to either reach out to you or learn more about what you're doing with the training and the kinds of programs that you offer, where's the best place that they should go on?
[00:51:34] Mark Raffan: Best place to go is to our website, at www.negotiations.ninja, or you can reach out to me on Linkedin.
[00:51:42] Jeffrey Feldberg: Terrific. And again, we'll have all that in the show notes. It'll be a point and click. Can't get any easier. Mark, as we wrap up this episode, a tremendous thank you for sharing your wisdom, your insights, your experience with us, and for our listeners. Aren't you walking out with at least one, probably a handful of strategies that are making you a smarter and better negotiator?
Mark. Thank you so, much for that, and as always please continue to stay healthy and safe.
[00:52:05] Mark Raffan: Thank you for having me. I appreciate it.
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[00:54:37] Jeffrey Feldberg: Are you leaving millions on the table?
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