Lawyers Don't Do Deals. You Do.
Monday, May 18, 2009 at 8:01PM A really good friend of mine runs his own very large company in Boston. Six or seven years ago, he gave me a great piece of advice when I was struggling with a potentially devastating situation that was about to get contentious and confrontational.
“Whatever you do,” he said. “Don’t get the lawyers involved.”
Through trial and error I’ve come to realize he’s right.
I know some extraordinarily talented lawyers. And I would never complete a deal without their help. The great ones are brilliant at making sure the agreement complies with the law, provides us with the operational flexibility we need, reflects the spirit and the intent of the deal, and minimizes the tax burden to all the parties. (Many times that has less to do with the number of dollars we give our government agencies and more to do with how simple it is for us to calculate them. You can’t beat Uncle Sam. But you can make joining him less time consuming. A great lawyer will help you with all of that.)
What they can’t do is put the deal together.
Lawyers are paid by clients. Their interest is in protecting your interest. Not encouraging you to take risk. Nor are they there to help you see the other side’s point of view. Their focus is on what’s best for you.
But deals get done when you see the other side. When you empathize. When you understand someone else’s point of view.
That’s not a lawyer’s job. And when you ask them to get involved in a negotiation you’re putting them in a position in which it’s almost impossible for them to succeed. Or for you to get a deal done.
Once you involve a lawyer, whomever you’re negotiating with involves theirs too. Positions get firmed up. Then hardened. Like quick-drying cement. Issues get introduced that no one had ever worried about before. The walls get higher. The differences more acute. And even if a deal gets done, it's cost so much in goodwill that no one can remember why you were talking in the first place.
Deals are like clay. You need to work with them. And to keep adding water.
So take a lot of advice, use a great lawyer, but handle the negotiation yourself. Face to face.
If it’s a deal worth doing you’ll know by the look in their eye.
Reader Comments (2)
great piece of advice.
lawyers are needed when closing deals not when your making them. risk assessment. tax liability. exposure. all information required to decide whether to leap. lawyers are not trained to be entrepreneurial. if were, they wouldn't be lawyers. be aware of those that think they are.
Too often, lawyers serve as easy punchlines, but this post couldn't be more accurate. It can be helpful to think of lawyers as a tool--a purpose driven tool. As you so rightly point out, in most instances their purpose is risk mitigation and single-minded advocacy and yet the best deals take place on common ground, making them the wrong tool. Particularly if you yourself are capable of--and I never thought of it this way--working the clay and keep adding water. Nice thought that.