Blog

Emotional Negotiations

Jonathan Gold

10 Feb 2016

Some people plan their negotiation strategy, the outcome they want, their Best Alternative to Negotiated Agreement "BATNA". Others seem to wing it, too many settle for something they didn't want and others of course walk away.

Like most venture capitalists I think I have seen more approaches than most, good and bad negotiators, many entrepreneurs actually don't make good negotiators and more should realise they don't. I started learning the art of negotiation some 30 years ago and was lucky to receive good formal training then plenty of practice in technology sales and license deals. Then 5 years with Japanese technology and industry businesses before I entered into the VC world.

So I think I can say I've worn the t-shirt a bit. What strikes me as odd is how few seem to consider and use or attempt to control their emotions and the atmosphere of negotiations and meetings. Especially with investors. Perhaps it's not a surprise that entrepreneurs get emotional, it's almost a given character trait and often it's the sheer drive and ambition that takes over.

However I suggest a bit more control would be good. I say this as recent research has started to look into the role of and test how outcomes vary with differing emotions. Aggression and anger as well as sticking to your own approach has been shown to result in poorer outcomes. I'm not talking win-win, but studies have proven that defusing anger and frustration and showing sympathy for the other side does work.

Most VC and professional investors I work with have known this a long time, as almost all remain calm whatever is thrown at them. Funnily, entrepreneurs still seem to think shouting gets a better hearing at times. So next time think your strategy through but also think about your own emotions and watch those of the other side, step in to calm and concede a bit. I think it will work out better for you.

 


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