By Deanna Petersen, CBO of AVROBIO, as part of the From The Trenches feature of LifeSciVC
It’s tempting to think that the first skill you need to learn in business development is negotiating. That’s important, of course, but it should not be your first stop. Business development, at its core, is all about building relationships. And while that may sound simple, I’ve seen many up-and-comers stumble because they fail to understand best practices and basic etiquette at the foundation of strong business relationships.
I’ve been asked several times where those rules of etiquette are written – and I’ve realized that they’re not codified—at least not in any book I’ve seen. So, I decided to channel Miss Manners and write this etiquette advice column for BD. Feel free to share any questions you have after reading; perhaps I can answer them in a future column!
Here are my best tips:
Show you care
As with any relationship, give-and-take matters in business. Ask questions. Show interest. Get to know the other party: “How are the kids?” “How was your weekend?” “How did you like that new restaurant?” And share some news about yourself, too.
I’ve forged genuine and lasting friendships during business negotiations, and they all started with this type of casual chit-chat. Even if you don’t make a friend for life, you will get farther in the negotiation if everyone around the table likes and respects one another. People do deals with people they like.
Control the tone
Negotiations get heated. And sometimes it’s a smart tactical move to let your frustration or even anger flare. But, if you do that, you should be doing it deliberately—and controlling it carefully.
I make sure that everyone who comes into the room or sits on a Zoom call with me knows what tone we want to strike and keeps their words, the tenor of their voice, and their body language in line with that tone.
Serve good food
I am a stickler for serving high-quality meals during in person negotiations. It lifts the mood and makes everyone less cranky. When you’re full and happy, you’re more willing to be cooperative and find common ground.
Defer when appropriate
If you’ve read my past blogs, you know that I’m no pushover at the negotiating table. I fight relentlessly for the upper hand.
That said, I make a point to follow the industry standard of allowing the party with the confidential information (usually the smaller company or a university) to provide the first draft of a new confidentiality agreement. You know it’s going to need amending, of course, but since it’s their technology or program that is the subject of the CDA, they get to start with their template. It only makes sense.
Proper etiquette also means letting the bigger company pick the date and time of each meeting. They’re going to have the most challenges in scheduling, so you work around their calendars. For the benefit of the deal that you want to strike, you want them to bring their A team—so make it easy for them to do so.
Say ‘thank you’
We’ve all been taught this since we were toddlers, yet somehow, when it comes to business dealings, too many of us forget how important it is to show appreciation. This doesn’t require elaborate gifts or grand gestures. Just make a point of thanking the other party periodically for their time and effort whether verbally or through an e-mail. Or, when they concede a point to you in negotiations, thank them. It makes them feel good about working with you and getting to yes—which may speed the path to a deal.
We all get busy. That’s no excuse for leaving the other party hanging. I learned this when I worked at a university and had a hard time getting responses from industry about their level of interest in academic discoveries. So, when I was the head of business development for Shire Rare Diseases and had to field numerous inquiries from smaller biotechs, my team and I made it a point to respond promptly and give each party constructive feedback on their technologies and programs.
And if you’re delivering bad news, try to do it in person. That’s not always possible, but it’s always preferrable. It’s more respectful and it leaves your relationship in a better place for future interactions.
Never say never
Speaking of bad news, never give a hard-and-fast “no.” I always prefer to leave the door open with framing along these lines: “We’re not able to move forward with your technology/program at this time, but if anything changes, we’ll get back to you.”
Why? The biotech ecosystem is small and corporate strategies are fluid. You never know when your needs might change, and you might come back to proposals you’d dismissed just a few months before. My mantra is to leave everything in a positive parking spot.
And when you’re on the other side, waiting for a response from a potential partner, many times it’s best not to push for a definitive answer if you sense they’re not all that interested. If you force them to give you a hard “no,” that means they have to convene their committee, have a discussion, come to a conclusion, summarize it in meeting minutes, and transmit that conclusion to you—usually in writing. In other words, you’re forcing them to set that response in stone, and that makes it harder (if not impossible) for them to reverse it, even if they wanted to. It’s far better to live with a bit of ambiguity and know the door will be easier to open and revisit in the future if the opportunity arises.
Following these universal rules of business etiquette will go a long way toward helping you build the relationships you need to be successful. In business development, minding your manners is not a sign of weakness. On the contrary, it can put you in a position of strength. I look forward to seeing you at the negotiating table! I trust the food will be excellent.