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The Story: James, Robert, and a Deal That Almost Derailed
Have you ever started a negotiation and got a response that blew you out of the water from the start? My friend James did and he shared this tricky situation he’s dealing with me.
He's about to make a significant step forward—he's looking to merge with Robert, the founder of Pegasus Advisors. He met with Robert and thought he’d kicked things off with a compelling, well-researched, generous offer that really set the tone for the negotiation.
He thought he nailed it.
But Robert came back with a counteroffer that blew James’ valuation out of the water—much higher than comparable deals. James froze and said he would get back to Robert in a few days.
He told me his situation and asked: Should he match it, offer to meet in the middle, or walk away?
My response was none of the above.
He had started with numbers instead of starting with curiosity. A question or two about the other person’s interests goes a long way to achieving better outcomes.
James’ Second Chance: A Better Opening
My counsel was to go back to Robert and say something like this:
“Robert, I may have rushed into the numbers too quickly. What’s really important is getting a clear picture of what a successful deal looks like for you. Let’s dive into the outcomes that are most important to you—your team, your legacy, your role—and work together to shape the offer around those priorities.”
Now that’s how you expand the pie.
Before Slicing, Expand the Pie
Before making any offer, James should have asked:
“Robert, what are the critical drivers—beyond price—that matter most to you in this deal?”
That single question could’ve reshaped the entire conversation.
Because let’s be honest: high counteroffers often signal something deeper. Pride. Legacy. Loyalty to a team. Future involvement. Strategic vision. And when you don’t uncover those early, you could end up negotiating the wrong problem.
Don’t guess, ask
Better Questions Lead to Better Deals
Imagine if James had led with questions like:
• “Which parts of your firm’s legacy matter most to preserve?”
• “Would you want to stay involved in an advisory or leadership role?”
• “What’s essential for your team’s continuity?”
• “Are there growth opportunities you want to unlock through this merger?”
• “How can we reflect the real impact you’ve created—financially and emotionally?”
These aren’t just “soft” questions—they’re strategic. They surface interests, not just positions. And that’s where great deals begin.
The Takeaway
Always look to expand the pie beyond the numbers.
Instead, ask the question that opens the door to real value:
“What matters most to you—beyond the financials?”
If you’re faced with a high counteroffer, don’t reflexively increase your price.
Because when you lead with insight, not just offers, you don’t just get the deal—you build the relationship, too.
By the way, Robert discussed several personal and business matters that James managed to accommodate, and the merger is progressing smoothly.
Over to You
Have you ever turned a negotiation around by asking the right question up front?
Related: The Power Play: Why Making the First Offer Can Win Negotiations