Last Updated Jan 24, 2011 10:24 AM EST
A friend of mine just sold his company to Donald Trump. The story he told me about the negotiation with Trump not only provides some insight in Trump's negotiating skills, but also illustrates an important point about "selling high." Even if your prospect is an uber-bigwig, you must treat the prospect as an equal. Otherwise, you run the risk of being fleeced. Here's how the situation played itself out for my friend...
About a year ago, my friend was contacted by Trump's organization with a bid to acquire his company, a medium-sized startup in the health and beauty field. After a period of due diligence and preliminary negotiation, my friend was invited to meet with Trump in order to iron out the final terms.
The meeting was held famous Trump Towers in New York City. My friend, though savvy at business, found it impossible not to be awed by the fact that he was riding the elevator featured in television show The Apprentice.
Rather than meeting immediately with Trump (the original plan), my friend was taken to a conference room to discuss the final terms with some staffers.
A message was then brought to the meeting that Trump would be arriving at the meeting in a few minutes. A staffer took my friend aside and said: "You need to understand that Mr. Trump never shakes hands with anybody. So don't be offended if he doesn't offer his hand, and don't offer your hand when he comes in the room."
While my friend digested this tidbit, the staffer continued. "Mr. Trump is a very busy man and prefers to make decision quickly. So if the meeting lasts less than five minutes, please don't take it amiss, because that's normal for him."
Finally, Trump makes his appearance. He walks right over to my friend and warmly shakes his hand. Then Trump proceeds to spend 40 minutes with my friend, discussing the business and then, at last, ironing out the final terms.
And those terms were, as you probably guessed, less advantageous than my friend might have hoped.
Now, when my friend told me this story, he kept talking about how impressed he'd been by the Trump Towers and how gracious Trump had been. "He even shook my hand!" he said, taking that as a sign of special privilege.
My friend had absolutely no idea that he had been totally mind-gamed.
- Game #1: The Impressive Office. CEOs have impressive offices because they want you to be awed. If you are, you're being just as stupid as teenage girl who's impressed because a guy has a neat car.
- Game #2: The "He's Too Busy" Routine. CEOs sometimes make you wait to see them, even if you have an appointment, in order to make you feel that the CEO and his desires, are more important that you time and your desires.
- Game #3: The Underling Gauntlet. CEOs often use underlings to make you feel like an underling. If you're not careful, you end up feeling "socially" bonded to the underlings and thus in a subservient position while meeting the CEO.
- Game #4: The Unexpected Handshake. The first three games above are pretty common in CEO land. This one is new to me, so I guess it's something that Trump thought up himself. Trump is turning a common business courtesy -- the handshake -- into a negotiation advantage. My friend felt complimented that Trump shook his hand. Give me a break!
- Game #5: The Meeting Extension. CEOs often set low expectations of the amount of time they'll be spending, so that people feel complimented if they spend more than that amount. Trump probably had an hour blocked off anyway, because this was a fairly significant business deal.
Even so, I suspect my friend would have gotten a better deal if he'd kept his cool and realized that he was being gamed. But instead he let himself get caught up in all the folderol of power.
Here are the lessons to be learned from this:
When you're selling to CEOs, don't get caught up in their exalted self-image. CEOs, even Trump, are just plain folk. If you're selling to them, you're their equal by definition. YOU have something the CEO needs; the CEO has something you want. So the two of you are equally important.
Also, you MUST continually be aware, when you're negotiating at the highest levels, that there's a good chance that there will be mind games. Anything out of the ordinary or that "feels weird" should raise red flags.
One technique that works for me, when dealing with "celebrity" CEOs (and I've interviewed plenty) is to make a realistic assessment of who they really are behind the facade.
Take Trump, for instance. He's so insecure about his looks that he keeps wearing that awful comb-over, and he keeps marrying not-very-bright eye-candy.
This isn't to say that you can't learn something about business from Trump. But, when it comes down to it, he's just a dude, and if he's playing games with your mind, your mind doesn't have to join in.