After you’ve prepared yourself, it is time to meet with the business person or team responsible for the deal. The goal of Step 2 – Coordinate with your Business Partner(s) – is working through key details of the proposed transaction in order to clarify objectives, define roles and responsibilities, assess preparedness and identify potential obstacles. In doing so, you are also able to establish more reasonable expectations around completing the deal and more importantly not making commitments you are unable to keep. The following is a list of key points to consider at this stage:
- Does the deal have an executive sponsor?
When the proposed deal is “unique”, as opposed to a routine end-of-quarter transaction, it is useful to know who supports the deal and how far up the ladder this support can be found. For example, if the CEO or another C-suite executive is involved, you can expect both considerable cooperation and pressure for an expeditious closing. Without support from the top, you are more likely to encounter internal roadblocks requiring extra time to resolve.
- What are the agreed upon terms?
This is by far the most important conversation you will have with your business partner. You must assess how far the parties are in their negotiations in order to set reasonable expectations around a closing date. If all of the key terms are in place and you are simply drafting documents, you can more comfortably agree to a quick turnaround time. However, if the deal exists purely in broad strokes, you may be asked to handle the negotiation of the deal structure and/or its core terms, increasing the complexity of the process and time needed to close.
- Are both parties equally motivated?
A major factor in getting the deal done quickly is the motivation of the parties. Ask your business partner to explain what is at stake for each party. By failing to ask this question, you could find yourself in the tenuous position of having committed to a closing date that is actually outside of your control in the event the other side is not as motivated to close.
- Can your client fulfill their commitments?
The answer to this question can also help in managing your client’s expectations. If you learn that your client’s resources are constrained in any way, you will need to address this issue before the deal can be completed. For instance, if the product that is central to the negotiations is highly customized or limited in supply, will this lack of product inventory interfere with your ability to close the deal? . Similarly, if closing can be impacted by factors outside of your control (i.e., design decisions to be made at a later date), you should advise your client of this possibility and its potential impact upfront.
Above all else, remember that your business partner is also your client. If he/she unwittingly sets unrealistic expectations, do your best to show support by politely guiding the transaction back on course. Anything that can be perceived as blame or criticism will inevitably backfire, so avoid such tactics at all costs. Coordination – when done right – will ultimately strengthen your client’s position, inspire confidence in your own abilities and encourage others to line up behind you to work together and get the deal done.
Frank Fletcher is a Partner with Outside GC LLC’s California-based team. He has over 15 years of in-house experience in software, digital media and on-line privacy, as well as extensive experience in Asia and Europe. His LinkedIn profile is available at: www.linkedin.com/in/frankfletcherprofile. Frank can be reached at email@example.com.