My job is to manage risks and for some of the largest organizations around the world. They run some of the most complex business activities and I often keep my head on a swivel to ensure that the impact of various risks (political, economic, social, technology, legal, and environment) are thoughtfully considered. It often leads me to believe that people often incorrectly:
Here are the concepts I consider everyday when managing risks and negotiating deals:
1) Leverage / Strength in Numbers - I list this as my first concept I often think about when I'm doing business negotiations. It's necessary because far too often the persons on the other side of the table do NOT look like me, may not take/respond to my call or business offer, or take your meeting BUT do not take you seriously. Here is Dave Chappelle with little leverage when he was first pitching his show:
Chappelle revealed that he pitched the concept for “Chappelle’s Show” to HBO before it landed at Comedy Central in the early 2000’s. The comedian claimed that the premium cabler’s execs “kicked me out of the office,” and asked him “what do we need you for?”
2) Own Your Work / Know The Terms of the Deal - You often hear me cite this as my most important principle because everyone signs contracts/agreements in life. IF you do not know what any terms in that document mean...use my rule: stop / question / demand. Being a risk manager, I read many of my own and other people's contracts - so I stop reading, question a section, and demand a change that's more favorable to my cause. A recent example of this is I was awarded my 2nd contract in as many months. I spent over 4 hours reading the 18+ page contract and made significant changes to the language that were NOT in my best interest. If you have "Leverage" (like I shared before) it will be easier to get these changes across. And always know which terms/risks are dealbreakers --- yes some terms are not meant to be compromised. Once you hand me a contract, I trust no one. And for very complex items, I am NOT afraid or too cheap to go and get additional legal representation to further review the deal.
Dave on his first Contract: “I was desperate, I needed a way out,” Chappelle claimed was his reasoning at the time. “It wasn’t good money and it wasn’t good circumstances, but what else am I going to do I said? All these white people sitting at that table told me trust us Dave it’s a good contract, and I looked around the table and they all seemed to agree it was a good contract. But what if it was like that game of three-card monte? What if they were all friends and I didn’t know it?”
I often focus on terms that indicate "all the ways" I might owe you money (usually I'm on the receiving end of being paid as an in demand consultant) and "all the ways" you owe me or might make money off of me. It's unclear but I think Dave may have had a resident deal - meaning he got paid as long as he worked/was an employee of the company. My question to a younger Dave is: a) Who owns the work, you or them?? b) what happens if you leave -- do you still get paid? c) What happens if your show hits syndication, re-run status, sold to another network do you get incremental / royalty / payments for your work still being used?? (Notice a simple question like this is not unheard of as the Cosby Show went into syndication if I am correct AND it would have address future situations and oddly enough new tech like streaming)
Dave on NOT being paid after leaving ViacomCBS: "They (ViacomCBS) didn't have to pay me because I signed the contract" "But is that right? I found out that these people were streaming my work and they never had to ask me or they never had to tell me. Perfectly legal 'cause I signed the contract. But is that right?"
3) Know Your Value / "ADD VALUE" to your Customers - At the beginning, negotiating deals was difficult because I would often think every deal is the most important deal and then I would be frustrated as the deals were close to being completed but NOT ultimately the terms I wanted. I had my lightbulb moment one day, when 3 companies called me about the same deal. haha the funniest or most maddening thing was the terms of the deal were very different even though all 3 companies were calling about THE SAME PROJECT. I started with the highest bidder and forced the others to match and/or come in higher -- amazingly I got the following "please allow me to escalate this to my senior level executive we don't want to lose you". Yeah that's what I thought. So from then on I set my own terms, take it or leave it. I know my value/my worth and what I offer and I'm sure it's hard to find in the industry. Please put me in contact with a decision maker. As you know, I am owner of Manchester United's stock so I was pleased to see another English Premier League club in the news and THEY had decided to partner their marketing/growth vision with Roc Nation. Leeds is tiny compared to Man U but relax and take notes, they wanna go places and teaming up with a black-owned enterprise when you participate in a sport that has many black, African and international players is simply strategic. I hope more ownership in the NFL take note as Colin Kaep is still not on the field...unacceptable. Here is the Leeds Mural celebrating their partnership:
4) Social Justice (No Longer Be Silent) - Affordable housing is becoming a bigger issue as the United States is becoming more of a renter nation. The new trend is new homes are built and being sold to investors like myself who in turn rent those immediately to renters. Not sure who can afford to rent a brand new house but I am just sharing the latest trends we talk about. Well my billionaire buddy Bill Ackman (who is worth $2.2 Billion) and Chris Paul appear to be investing through their family foundations (yeah you're rich when your family has a foundation) in affordable housing. The $357 million investments appear going to Bobby Turner the CEO of Turner Impact Capital to develop affordable housing for working families. This appears to have a social impact to it, but to be clear, I've not read the prospectus for this fund. I truly hope it targets the communities of color that are disproportionately affected by the affordable housing crisis. But again I don't judge, maybe I'll see if I can learn more about the investment fund and if I like what I see...why not invest.
Bill Ackman and Chris Paul Affordable Housing
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