Dealmaking is irrational

Whenever two parties come together with the intent of making a deal happen, it’s important to appreciate at the outset that both sides will behave irrationally.

Emotions play a major role in the decision-making process.

Plus both sides will never have full information, so what seems irrational to one side may be rational to the other.

So to increase the chances of making a deal happen, keep gathering as much information as possible to understand the underlying motives of the other party. The more you know the reasons for the other party’s actions, the better you can shape your proposal to reach alignment.

Then once you reach alignment, sign the contracts as soon as possible! A deal can fall over at any time, so never feel confident that the deal will happen until the contracts are prepared and the required actions are taken.

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