In our podcast Royal GS, Nikita Fahrenholz shares a trick on how to get a deal quickly. Spoiler: It has something to do with quick calculations.
A good business needs good deals and you have to negotiate them. What makes a good deal is that you don’t want to renegotiate it after two, three or five years – that’s what Nikita Fahrenholz (founder of Delivery Hero & Fahrengold) and Martin Eyerer (ex-CEO Factory Berlin, entrepreneur, techno DJ) say in the latest episode of our podcast Royal GS.
Listen to the episode here: Spotify and Apple Podcast
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Most important hack for preparation
According to Fahrenholz, the basis for every negotiation is “knowing an excessive number of facts,” as he says. The best thing to do is to find out what is important to the other person in the deal. This is the most important part of negotiating. The best way to achieve this is to let the other person tell you as much as possible and not talk too much at the beginning. “Whoever asks is in charge,” says Eyerer.
How to get a deal quickly
According to Fahrenholz, anyone who knows the facts can quickly come to a successful deal with this trick: short arithmetic tasks. Fahrenholz used this tactic in the past, for example to invest in a company or to collect money from investors. The best way to do this is to be able to calculate quickly in your head or prepare various calculations.
Fahrenholz gives the example: “You talk about a deal and it’s about a purchase price. Then you say: We could theoretically reduce the sum by five percent, but in return you give me a ten percent revenue share [Anm. d. Red.: Umsatzbeteiligung] to this lot size. You have that in your budget. This is what was written in the file you sent me back then. Otherwise we simply make a minimum cap [Anm. d. Red.: Mindestbetrag] at 50,000 euros, cool right?”
Disadvantage of this tactic
According to Fahrenholz, the tactic has the following effect: the other person has to do the math quickly and have all the facts ready. If that’s not the case, you’re putting your counterpart in a situation where you want to save face. That’s why, according to Fahrenholz, many would take part in the deal. He says he no longer uses the tactic himself.
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When he negotiates for his company Fahrengold, Fahrenholz now uses a different tactic. “I’ve decided for myself, I’m as honest as it can be. To tell my partner, be careful, you get exactly what you buy here. And in the end it’s about a long-term partnership and trust.” No huge promises, instead transparency and a clear range that an investor can expect. “It’s just a psychological handshake that I’m totally serious about.”
PS: What doesn’t go down well with either of them during negotiations is when the deal has actually already been agreed and someone renegotiates again shortly before the contract is signed.
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