A business that is able to consistently strike good deals is a business that is likely to succeed.
This past week, I got an opportunity to get negotiating tips from one of the best, Lisbeth R. Barron, of Barron International Group, at her home on the North End of Palm Beach. Over the course of her 30-year career in mergers and acquisitions and investment banking, Barron estimates she has been part of more than $60 billion worth of strategic advising and capital-raising transactions.
Variety magazine, in September, listed Barron as one of its top deal-makers for 2017. The magazine cited two deals, in particular. They are the August sale of the “Judge Judy” TV program library in August, (reportedly for $100 million) and Concord Music’s June purchase of Imagem Music (reportedly for $500 million).
So Barron knows a thing or two about negotiating deals. First thing, she says, is throw out what you likely learned in business school.
“What you’re taught is to win at all cost,” said Barron. “For me it’s never been that way. I want a win for my client. But I want everyone to walk away feeling it was a balanced deal.”
A deal where the terms make the parties feel good is a deal that has a high chance of getting done. That takes a lot of work and skill, she said, starting with learning to be a great listener.
Barron recalls one of her mentors, Martin Lipton, founding partner of Wachtell, Lipton, Rosen & Katz, set an important example by not saying a lot — literally.
“Marty studied the room, and watched everyone’s body language,” she said. “He listened very carefully.”
Listening and studying people is an indispensable part of discerning what it is everyone wants. And when you know what everyone wants, Barron said, it’s possible to negotiate a deal where people walk away happy — that proverbial win-win.
Still, even that does not replace research. Barron said it’s critical to pour through a company’s records for its entire history to understand corporate culture. And to determine appropriate values for assets, she uses her proprietary 30-year database of precedent transaction valuation metrics.
That’s important in arguing a price for a buyer, and also giving the seller a realistic understanding of what can be expected from a transaction.
Yes, it takes a lot of work, which is why Barron said a 100-hour week is not unusual, and neither is finding her in her office at 2 a.m. or 3 a.m.
One other thing: Be discreet. Barron doesn’t talk about clients unless they’ve told it’s OK for her to acknowledge working for them. When I visited her last Tuesday, Barron handed me a bound document with her firm’s credentials and overview. But before I got my hands on it, she dutifully ripped out the pages that listed her clients — giving that binder a deeper redaction than the recent JFK document dump.
Finally, learn from your clients. Barron said Judge Judy, real name Judy Sheindlin, has been a “great teacher” as well.
“She emphasizes to always be willing to walk away,” she said. “Also, to shoot high. And be fearless. And be decisive.”