EP 106: Deal Jamming with Marc Morgenstern

Ed Mysogland  0:20  
Morgenstern, he is author, solo the deal. And I've read lots of books I've been I've been, I've probably say that nauseam that I've been in this business for 30 years. And I've read lots of books. This is I love this industry. And I've never bumped into a book that, that about m&a That that was was so good. Then sold the deal. It is at the top of the list for me and, and Mark is he delivered he Oh my gosh, so many good, so many good things about about doing deals, you know, not not not just the X's and O's go where they go. But this is a as he says, deal, jamming deal. Jamming is about taking all of the pieces that go into a deal. And there is no rules. It's just, you know, maybe it's gonna take six weeks, maybe it's gonna take six months to a deal, it doesn't matter. But what does matter is the parties that are involved in how they, how they operate. And one of the biggest takeaways that I received today in this podcast was there's not a buyer and seller their counterparties and start behaving in that manner, that we shouldn't be adversarial buyers, buyers are looking to minimize their their risk sellers are looking to maximize their value. That's just the way it is. But we're not adversaries, we just have two different points of view. And mark in this book, is it is absolutely dynamite. So I 100% Hi. I know I say this a lot. But But boy, each one of these podcasts builds on another and boy, he knocked it out of the park. So enjoy my conversation with Mark Morgenstern. So Mark, welcome to the show. It's great to have you. Well, thank

Marc Morgenstern  2:16  
you so much. It's a delight to be here.

Ed Mysogland  2:18  
Well, I'll tell you, I, I am I, I normally have my greatest challenge in the podcast has to do with introductions, and I. And I just botch those up. And, and I was hoping that you can just kind of give an overview of yourself and where this book came from. Okay.

Marc Morgenstern  2:41  
Well, here's what's confusing and explaining my life to people. Normal human beings have consecutive careers. I did this. And then I did that. And then I did this. And what's hard to explain to people is, I didn't have enough common sense to say no. So my careers were all concurrent. At the same time, I was the managing partner of a law firm, and a very active deal lawyer. I was also a real estate syndicator I also started a real estate placement agent. I also started a venture fund. I also helped start OfficeMax I don't know, I wrote a lot of articles, I did a lot of teaching. My wife, I my view is I meet eclectic, right technology, real estate, my wife's view is I am unfocused. So are we all but one way or the other? It's always focused around the early stage ecosystem, okay. And then every side of the ecosystem you can get? Well, the,

Ed Mysogland  3:46  
like, I was mentioning to you, before we got started, I married to a therapist, and, and I have all these, you know, play playbooks, all these books about you know, how to do m&a And, and valuation and, and the technical side of things. And then out of nowhere comes the soul of the deal. And so, I, I found this book, and I loved this book. So I am curious to know what, what possessed you to start writing from that angle? It wasn't because you said you clearly had the technical chops on, you know, this is how you do m&a. This is how you grow a business. This is how you scale. But this is different. This is an entirely different angle on on on the domain. So how did it get started?

Marc Morgenstern  4:30  
Well, let me start with one of the things I would hope that your listeners will be willing to consider. Which is that I really do encourage people to listen like JamBand musicians, not like lawyers. And I say it that way. Because I remember I was a lawyer. I manage law firms. This is I'm not dissing lawyers. They're trained as advocates. And if you tell a lawyer something what typically happens, they tell you why you're wrong. a robot's you, they distinguish you, they deflate you, they deflect you. But they don't say anything like, Gee, that makes a lot of common sense. So if you contrast that with, you know, the beginning my book is encyclopedias selling the end is the Grateful Dead. Yeah, what do Jam Band musicians do? Their listening to engage? the Qataris is listening to what the bass player is saying, Hey, should I go there or not? The rhythm guitarist is trying to bridge the difference between what the bass is playing the guitar is playing the piano is trying to figure out how do I add color commentary to what's going on? It's a completely different form of listening. And that form of listening if you're doing deals, x, if you're doing anything, is how you end up with productive dialogues. So the actual story of the book, which you intuited isn't normal, because nothing I do is normal. So through the years, I've done tons and tons of teaching at places like Wharton and the SEC, and I don't know, MBA programs, Weatherhead, stuff like that. Very academically, very third party. About six or seven years ago, I started was looking through my notes and said, You know, I have like 300 pages of notes here. Why don't you just stitch them together and make a book. So here's a very academically very relatively dry third party book. It's similar to things you've read. I showed it to my when I got done, it took me two years, showed it to my dad 95. At the time, he said called me back. He said, Mark, this is brilliant. He said, No one's going to read it. But if I said, well, thank you very much. What are your thoughts that he said, Well, what's good in here are the Maxim's and the stories. Those are really good. So you should write a book. That's just Maxim's and stories. Okay. I don't know how to write a book. But I think well, I'll take a maxim and I'll make each one the chapter heading. And then I'll tell the backstory, will have 30 or 35 chapters, and it has almost sitting in a book they can, okay. Two years, get it all done, show it to my children, both of whom I, my dad have MBAs, which is a problem for me. So they said, Dad, this is brilliant. But you can't write a business book this way. Why not? Is that Well, that's not how you do it, they have to arcs they have to have narratives. You've got to tell a story from beginning to end. So the book you're looking at, was driven by two things I did wrong, followed by a lot of advice. And then at the tag end, I had a couple of friends of mine who were reading it. And I said, Hey, here's the last draft, guys. Anything you got to say, say it now. And they all sent it back and said, Well, where are the key takeaways at the end of every chapter? What are key takeaways? They said, Well, that's what you have it every business book at the end of every chapter. I said, Well, I don't read this books. I didn't know that. So I wrote the takeaway. So the brilliant construct of this book to be clear,

Ed Mysogland  7:55  
not mine. Yeah. Well, you know, but But you're right. And there are so many. So I collect quotes and maximums and different things like that, and I and I, and I'm showing my age and I dump them in Evernote. And at some point, when I'm long gone, my children find, you know, my, my Evernote notes, they're going to see, see that and I mean, you literally just cut and paste that back, you know all of your little Maxim's and just paste them into into a document, because they're all really, really good. And I know later in the interview, I have a couple that I wanted to ask you about. But the but as you were, as you wrote, or as you were thinking of writing the book, and I think there became, you know, the X's and O's are one thing, but I think what resonated with me is that there there is so much more to getting this deal done. Right now I've got a I got an entire conference rooms with, with with attorneys and buyer with a buyer and a seller. And they're all like sit there. The X's and O's are obviously easy, but they're, they're clear. But getting getting it across the finish line was there is the emotional component to doing so and, and I guess where I was heading with it is I wanted to know, How How did you how did you find that? Well, that each of each rep that you made each deal that you did, there was that component? And then you started stitching. You said you had 300 pages of notes. Well, what made you start taking those notes, because there was there there was something that was hanging out there. And

Marc Morgenstern  9:42  
I wasn't American social history major in college really. Which tells you a lot all by itself. I never took a business course I never took an accounting course I never took a tax course I never took an econ course. So my view of life has always been There's a lot of stuff. It's like domain stuff in any domain, whether its history or its m&a. And knowing that is sort of table stakes. And of course, you have to know that you have to master that. The what makes the difference whether it's a band, or it's a deal? And the answer is it's people, that it has to be. Logically, there is no other conclusion. Unless I went through deals. And, again, I'm pretty comfortable saying, you know, I wasn't born fully born from the loins of Zeus. I mean, I assure you, a lot of mistakes. But one was all done being a history major, you'd look back and think, Well, what did I do? What shouldn't I have done? What wouldn't made a difference here? What would have made a difference there? And particularly, what I would notice is something that somebody actually said to me two or three or four times that I did not understand what they were saying, I didn't have a common sense to say, Hey, this is the third time you've said it. Yeah, it must be important to you. There's an implication there. I don't get the implication. So could you please spell it out for me? And don't be afraid of insulting my intelligence? Because you can't just make sure I understand it, please. And if you go all the way back, that was the for pretty much the first thing you learned in selling encyclopedias. How do you make any sale? Right? First, you find out what the customer wants to buy, you sell it to him. And that's the order that you do it in. But many negotiators figure out what they want. And they sell trying to sell their counterparty what they want. Yeah, not ever find out what the counterparty wants and why they want it. And

Ed Mysogland  11:41  
I think that's that is, especially the smaller the business, the harder it is to sell. And I don't think that the businesses are positioned in a in a manner that they they can, like said that, that, that they can sell to that person to whoever's Next, there's not there's not other than an earning stream. No one. I mean, it's, it's, how do I replace you? You know, whereas upstream, it seems as though that you've got so many, so many different layers that offset the micro business owner?

Marc Morgenstern  12:19  
You know what I mean? Yeah, but it's the smaller the business, the more the business is simply the founder. Right, the left there is to sell because you're not buying the foundry. And there are two ends that problem. What is the founder going to do the day after they sell the business, which is pretty confusing. And the buyers trying to figure out, well, if a founder, isn't there, is there a business? Right,

Ed Mysogland  12:44  
though? 100%. And the funny thing is that as you know, there was a study done that I mean, 76% of, of business owners that sell their business regret selling it, because you know, they, they've lost their identity, they've lost, you know, what, what it was that got them up in the morning, so I'm with you. You. Deal empathy. You, you cite that a lot. And I'm just, I'm just curious to know how to, you know, how do you find that mutual ground, because I think, you know, when, you know, as you know, I mean, when you when you start down the path of doing a deal you now have, it's an adversarial, because, as a buyer, you're, you're looking under the hood, you're doing the due diligence, colonoscopy, and there's a lot of scrutiny that I don't believe business owners are used to, and conversely, you know, that business owner or that business buyer has had hundreds of reps of looking at other deals. And your end that seller is totally out gun. So so they begin right out of the gate with a with a with an adversarial relationship. So how do you bridge that?

Marc Morgenstern  14:01  
Well, let's start with some vocabulary, which is why I don't like the construct of people being adversaries. I don't like the concept of the other side. I don't like the enemy. And you'll notice in the book, I consistently describe the people as counterparties. house parties is neutral, right? And a buyer can't get their business bought can't buy a business if the seller doesn't want to sell it. And the seller can't sell it if the buyer doesn't want to buy it. So they're counterparties. And I look at it that they're all trying to get the same place. sale of the business. So we're not enemies and why wouldn't I have empathy and real empathy? I'll tell you part of the the distinction I make is there's a really, really good book by Chris Voss, which I'm sure you've read your writing difference. Never split the difference FBI hostage negotiator It really to me sort of paved the way for a different level of thinking about the human emotion involved. And here's the limitation of it. What he was describing when he was describing bonding and rapport. He's talking about a hostage negotiator and a kidnapper. Now, how much do we think they're really going to have empathy for each other? We're not. And so I think what he talks about is creating what I think of as tactical empathy. It sounds like empathy. It sounds like I care. Do you like the New York Yankees, but negotiators trying to find any reason to humanize the kidnapper and relate to them? But you can. And you can do that if you don't have to sustain that for three hours or six hours or 24 hours. But if you take that approach to empathy of a deal, that's going to take months, it doesn't work. It's a crocodile smile, everybody will see right through it. So the concept is right, but it's not deep enough. So how do you get sustainable deal? Empathy? Well, all I can tell you is I've literally never talked to anyone. But as some particularly asked him that life story that I'd say, Wow, that's really interesting. You did this, you did that. You hate the Yankees, great. I hate the Yankees too. All right, thinking people hate the Yankees. If you're talking with people, you find the things you have in common first. And if you find them, then you each become a human being to the other. And once you become a human being, and you're sort of trying to you're trying to get along, you're not you're you're saying hey, you know, I understand what you're saying, I can't accommodate it. I completely understand what you're saying. And if I were sitting where you're sitting, I would say the same thing. So instead of saying you're stupid, or it's wrong, or rejecting it, you're you're literally empathizing, you're saying, hey, if I were looking through your eyes, that makes a lot of sense.

Ed Mysogland  16:59  
Well, I'll tell you what, one of the things to piggyback off the Chris Voss book, and I think it's probably saved a lot of deals is, you know, when he said, you know, how am I helped me understand how I'm supposed to do that. And, and that's, that forces the counterparty to share. You know what, that's true, you probably you probably can't make this work.

Marc Morgenstern  17:28  
And, and if you reframe the way he said it, what he's really saying is, I'd be happy to accommodate your request. But you have to be able to tell me how it can be accommodated, you can't put the burden on me. So you tell me and we'll see if that works together. And by the way, I being Chris Voss per second here, you know, one of my Maxim's, as you know, is exploration is not commitment. So in Chris Voss is saying, Hey, I'm willing to explore it. I can't commit to it, because I don't understand it. But I'm very willing to explore it. And the second you validate people, you acknowledge that their question has meaning, you've gone a long way, again, toward bonding with them, okay, this person is not rejecting me, they're acknowledging what I'm saying, I like people who acknowledge me, and I feel a little more kindly towards you. And that creates what I call social lubricant, emotional deal glue, you know, things that get you closer together than farther apart.

Ed Mysogland  18:30  
Interesting, because, you know, and I'm certain you've seen sellers that have done things for buyers that that defy all logic only because of the relationship that they've established. And conversely, I'm certain you've seen sellers scuttled deals, just for the sake of I really don't, I really don't like you anymore.

Marc Morgenstern  18:50  
No. And you know, again, one of my Maxim's, which sometimes people think is simplistic, but it really isn't simplistic. It's simple. People like to do business with people they like to do business with, you know, when you're picking a dry cleaner, Edie? You know, do you pick the dry cleaner because it's the lowest possible price with the least possible convenience here you go someplace when you walk in, they smile at you, and feel good that you went there. You like to do business with people you like to do business with? You do? Well,

Ed Mysogland  19:24  
it seems it seems anymore, especially like the I know, quality of earnings have been going on for forever in a day. And, and but it seems as though that it's becoming more and more prevalent and it's it's moving further further down downstream. And I think there's a there's starting to be a you know, that third party that's coming in to be that bad guy, and I'm trying and I'm trying to formulate the question, because as you were talking, you know, it's one thing When you and I, as counterparties are talking, and it's another thing when you get a third party that comes in here and and is serving as the bad guy. And I'm just curious to know, your take on, as you continue, you get these, these specialists that are being dropped in whether it's appraiser QV, or whomever? How do you keep, keep that deal empathy together?

Marc Morgenstern  20:27  
You know what I mean? Are you on the buy side, the sell side, either either or ticket. So it depends how you present the expert and why you're presenting them. The quality of earnings is almost always introduced by the buyer. So we can guess the point of the quality of earnings is to point out that there isn't any, therefore the business is worth less. So the experts being brought in to buttress the point of the buyer. You could probably as the buyer, say to the seller, hey, I'm not telling you this is the only answer, or the only thing I'm saying to you, this is kind of objective reality. This is how the Marketplace uses information. I'm introducing it here, because it may let you see your business a little differently. It'll help me see your business differently. And then maybe we'll have a common vocabulary going forward. And extremely empathetic. Yeah, doesn't say, hey, it's quality of earnings is $2. That's all it is two times three is six, I can pay $6 Whole

Ed Mysogland  21:34  
different gig. Yeah. And and I hope the listeners from this podcast, pick that up because I think that's I think that's what you're using a queue of E mercenary coming in and and being the bad guy and trying to preserve your relationship and, and from where I sit. I'm, I just don't think that that's a I don't think I think your hit ratio will increase if if you just slow down and describe it in a manner

Marc Morgenstern  22:03  
that you did. You know what I mean? You know, it's, it's a variable, it's a factor. It's just a thing. It's sort of like when people in Riverside told me Well, Mark, that's not market. I say, Well, okay, if you're buying this from the market, that's really positive, but you're buying it from me, though, what I agreed to is the market. Thank you for sharing the market view with me either don't care.

Ed Mysogland  22:29  
I just before you came on, I was I just saw that. Because I was I was thinking about that. And, you know, because I'm a I'm a Business Valuation guy. I've been a valuation guy for years. And, and I no matter, I always preference, no, this piece of paper that I'm giving you, means nothing the market is the market, and and through a process will determine the market. And I can tell you how I believe that the market will behave toward this investment. But at the end of the day, you know, you're part of that market, and so is the buyer, and that that's the term is it? Well, you and I seem to as counterparties, we agree to that you would be surprised how many people don't? Oh, my goodness, time kills all deals. And I'm just curious to know, because you said that time kills all deals, and deals aren't over until they're over. So what is over in your world?

Marc Morgenstern  23:35  
In my world, literally it means to me when the pieces of paper have been signed, the money has been wired, and I've received it and I can access it. Because until then I don't think it's over. And in one of the stories every every story in the book is you know, it's true. I changed industries and names and geographies, but every story is true. And one of them is a loan deal, which I'll make this much shorter for your audience. But we're refinancing a company we were giving the lenders better terms because we we had reasons to do that and had benefited us. And so the lenders were delighted. And there was no particular hurry in getting it done because it meant that we were going to pay higher interest rate. So no urgency on either side. Closing got postponed a couple of times because the lenders someone lenders wanted to be there and couldn't be there. So finally, it's now the actual closing day and this is almost minute by minute Drew, started closing documents at eight o'clock in the morning. And one of the shareholders signed for like an hour. Then second because they had to sign guarantees and stuff like that. Second shareholder signed for about another hour for them himself. Then there was another two hours in which the CEO signed on behalf of the company so we might have been there for like three or four hours and we would have been signing down documents. And then there was a lead bank, the syndicate lead. So the lead bank has to sign all the documents. And now there are exactly two things that have to happen. There are two other banks, they each need to sign a one page piece of paper that says, hey, the syndicate leader is the syndicate leader, I agree to it, I'm buying $2 million of this loan, okay, two pieces of paper. Lender, number one, lender two, technically two signs it. Now last lender picks up the pen. So their pen is, what four inches, five inches from a piece of paper, and they start to sign it. And just then someone comes in the room and say to this lender, hey, I'm really sorry, but there's an urgent call for you. I've been sitting here for four hours with nothing to do. In person says it's really urgent, just put the pen down comeback lender goes away, shorten the story up a lot. 30 minutes later comes back, the chairman of the bank had just revoked their authority to sign the loan. This little been going on for five months, it was better for all the banks. Every document had been negotiated, every document had been agreed to every single party had signed it except for the single last signature. So deals are over when they're over and then not over until they're over. And the reason a lot of deals fall apart on the sell side is the seller starts thinking the deal is over. And they start spending all the money they're gonna get you're spending all the time they're gonna get. And they start getting careless. And they don't come into work at eight in the morning. Because it's somebody else's business, they come in at 1030, there's a problem and they don't address it. All of those things start getting deals to drift. And once they start drifting, they're very hard to get back together. Well,

Ed Mysogland  26:50  
and the funny thing is that they turn around and the buyer rightfully so says, Why don't we Why don't we take a look at the last three months financial statements. And and now all of a sudden, you've got there's basis for? Yeah, oh, say Retrade. But there's basis for conversation.

Marc Morgenstern  27:09  
Well, you time allows buyers to develop buyer's remorse, selling encyclopedias the rule was very simple. Sign the contract, get the check, leave the house. Don't give people time to think you're done. Close the deal, because every second you haven't closed the deal. Because I had deals that were closing ready for this on September 12. Of 2001. That'll be how many of those deals closed? None. Not me not buyer knots. Actually one of them was going public, but it was the external universe changed. And I'm subject to the external universe just like everybody else's. Yep.

Ed Mysogland  27:55  
Well, speaking of speed, so you you introduced the concept of urgency accelerator. So can you provide a kind of a, an example of of what an urgency accelerator is?

Marc Morgenstern  28:10  
Well, I can do it first. I'll just do it in the consumer world, because you all experienced it. Every time you go on Amazon, right? You go on Amazon. I know you go on Amazon, everybody goes on Amazon. I literally I ordered I ordered a heating pad yesterday at five o'clock was at my house at 730. But when you go on Amazon, what does it show you? One time limited sale, quantity left in stock, one. You know, Prime Day only then prices revert to a higher price. You go by a carpet store, going out of business, the same carpet store has been going into business for 40 years. But what's the message? Well, if you don't hurry, if you don't act now, the Prime Day sale will be over. If there's only one left in stock, it will be gone and you can't buy it. Now I've given you an urgent reason to act. If I go out to bid, the carpets aren't there to buy them. So those in the consumer world are urgency and in the in the deal world and more translates to listen. We've been chatting for a while and I've really enjoyed it. Not just trying to share some information here but I guess word has gotten out that you're getting really close to trying to buy me and so some other people are poking around and and phenomenal. I'm not really answering their call. But you know if we don't get this done like in two or three days, and I don't know maybe maybe my spouse will make me take those calls. What do you think?

Ed Mysogland  29:43  
I see that. That's that's a good example. Yeah. I I wanted to ask you two more questions. I wanted to ask you the common mistakes or misconceptions that business owners Make in doing deals? And how and how to how to avoid them? And Where's, where's the where's the speedbump? That you know that you're probably heading in the wrong direction?

Marc Morgenstern  30:15  
So here, you know you, you said in some other context add quite correctly that for sellers, it's frequently like a one time event. It's the only time in their life that they've done it. Maybe they sold a house, maybe they didn't, but they probably never sold a business. And if you think about selling a house, which many people have done that everyone has done, but many people, what's the common fallacy of a homeowner selling a house, my house is the best house down the street because and then fill in the blank. My tree lawn is wider. My trees are taller, and my windows are cleaner. my driveway is longer or more to the point. It's my house. Yeah. And if it's my house, it's worth more than every other house does. Because it's my house. So everybody overvalues their own assets, they don't do it intentionally. You know, it's like many forms of confirmation bias, you see what you want to see. So all you see are the good things. What does the buyer see frequently? Well, they see all the warts on the frog, they don't see the frog. So you keep thinking, the princess is about to kiss you and boom. So how you get a realistic evaluation, which is, by the way, why somebody talks to you or talk to experienced attorney or an experienced account. And what they can share with a business owner is, hey, you're welcome to think about your business any way you want to while you own it. But you need to at least understand how other people looking at it. And things that don't bother you will bother them. And here's not just what they will be bothered by, but why it will bother them, and why that's a legitimate concern. You can assuage it, but you can't pretend it's not a legitimate concern. That's

Ed Mysogland  32:05  
interesting, because, you know, it seems as though you know, I've been in this field for a long time and I I'm starting to see people doing these market study assessments, you know, where they're, they're basically pre selling, they're going out total anonymity, hire somebody to to find out who's buying and why and finding those finding those, those warts and all, and, like said, basically a pre sale. And and you see that is that? Oh, is that a real thing? Because, you know, it seems as though here in Indiana, we it takes a little bit of time for for things to trickle into the middle here. So do you see that or no?

Marc Morgenstern  32:46  
Well, what I see which is the equivalent of it is there are more and more sites where you can sort of put in anonymous information and get an effect almost an auction type reaction to it. So without actually putting your business on the market, technically interesting. And, and one of the things in a digital world is people will not be as bound by living in Indianapolis as they are today. They'll be able to get much broader datasets. There's a sort of corollary of that, which is probably what I've been teaching about this month is small business owners generally in small can mean anything below, like $100 million at this point, right. So it doesn't mean $122. The world of generative AI is moving so quickly. And it is impacting every single business, whether they really understand that or not. So what I've been saying to businesses, I'm Simon, as you know, I'm also a part time partner of venture fund at UC Berkeley. I held the AI accelerator there this summer. So I'm looking at the front end of some of this stuff. The question I've been asking everybody is, why are you going to use AI? Will it change your business? The answer is well, sure. I'm looking at it, because it'll do whatever it's going to do. Do you think your customers are doing anything? Well, sure. They're doing the same thing on it's interesting, though. If you're changing and they're changing, why would you expect the value proposition in between to remain static? Because that was obvious to me. And by the way, you currently think of your competitors as being your legacy competitors, the people you've always competed with? I'm going to respectfully suggest to you that your real competitor is a startup that isn't burdened by legacy, but is starting as a essentially an AI native, and they're going to be competing with you for your customer and you can't even see him yet. Interesting. And by the way, let me say one more thing. That blew me the whole concept of quality of earnings in a Gen AI universe. I question more than I ever have, because I just don't think the past is as good a predictor of the future as it's ever been

Ed Mysogland  34:59  
Yeah, it's funny you say that because I just interviewed a fella by name of Brett gains from his company's Loomis data. And they are supporting SBA lenders. And they only need like six pieces of not not with the business, they need the business name, I think or I'm sorry, the business si si code. And they can they can predict default rates with six pieces of information, they they pull all this information, whether it's unemployment in the area, you know, default rates from the SBA and they can pilot and they are doing they are able to support that SBA lender and saying, you know, this is this is as good as, like in his in the podcast we talked about, you know, this Jimmy John's franchises, every bit is financeable and a good deal for the bank as that dental practice. And, and so I'm with you, I It's I I'm I'm looking forward to putting the hammer down and seeing what these next 20 years look like, especially with Al it's

Marc Morgenstern  36:09  
gonna be it's going to be fun, interesting and challenging.

Ed Mysogland  36:12  
Amen to that. Deal, Jamie. Yeah, I have let's talk deal Jamie. Head. It's who are the who are the participants in the deal jam.

Marc Morgenstern  36:29  
So let's start with go back to a stage for a second. Remember, other than encyclopedia selling and playing music and falling in the dead? It's all to me. It's all part of the same thing. On stage in a deal jam, let me let me do a contrast. Quick. So have you ever been to a Rolling Stones concert? I have. Okay, have you ever been to a Grateful Dead concert?

Ed Mysogland  36:50  
I haven't. I've been with the John Mayer side. Okay,

Marc Morgenstern  36:53  
let's, it's all good. But here's the point. If you go to Rolling Stones concert, these are really really good musicians, brilliant songwriters. And they know their audience. They know their customers. And what did they do every night? If they went on the road for 100 dates, and you saw 100 of them, you'd pretty much see the same show every night. The same songs in the same order. It might be two minutes and 42 seconds one night and three minutes and other night. You know, Keith Richards might play an extra tall bars or not, Jagger might prance around a little longer or not. But fundamentally, it is the same thing every night done slightly better or slightly worse. If you're following the Grateful Dead, they never played the same sign consecutive nights. If you saw them 100 Nights, you would probably not see the same song twice. Right? If you heard it once, it might be three minutes, if you heard it. Second time, it might be 33 minutes. So deal Jamming is you're starting with a basic structure. And then you're following it where tonight's audience, tonight's Band, tonight's mood takes it interesting. And that's the approach to a deal, which is Jerry Garcia has a great sentence which I'll paraphrase badly, but it's essentially that as a musician, you fall into an auto trap of familiarity. Interesting. So you start to play three notes. And your brain says, Hey, I know what comes after those three notes. It's this fourth note, where you start to do a deal. Well, you've done this in your case, you've done this deal 52 times. So you know what you're expecting, and therefore you see what you're expecting a deal jammer says I have no idea what's going to happen here. I'm going to listen to hear how this could unfold. And I don't have to win every variable, I have to win enough of the variables that it's a good deal. But it could be variable one, two and 10. It could be 346 and 12. Interesting, dynamic. I'm working with real people in real time and a real set of circumstances. It doesn't have to be interesting.

Ed Mysogland  38:55  
So yeah, you're saying that and I'm sitting here going, you know, you've got the pentatonic scale, you got 12 notes, how do you want to put them together in order to get the deal done? And

Marc Morgenstern  39:06  
there's there are no rules? No.

Ed Mysogland  39:10  
Interesting. Well, you know, I came out of school and, and I have been, I wanted to be an investment banker, and I got into this brokerage world and I've never left. So this is 30 years of being in this environment. And so I am so glad that I bumped into you. Oh my goodness it. I want it like I said in my invite I want to be you when I grew up, because my goodness, like

Marc Morgenstern  39:38  
to be me if I ever grew up, but I've given up on growing up.

Ed Mysogland  39:42  
Good for you. And I hope you I hope you never do but I do. I always ask some of my guests kind of our last question is, you know, what would you if you had one thing that you could share that would have the greatest impact for value and saleable Woody, what would what would that one piece of advice be

Marc Morgenstern  40:06  
rigorous honesty with yourself about who you are and what you have rigorous attempt to understand what the buyer will acquire. And because you know your business better than anyone else, if you really understand what they want to buy, you can present and shape what you're selling, to conform to what they want to buy. If you treat every buyer as if they are the same, you will present the same thing every time and you'll miss the opportunity. Ask every question you can have the buyer Why are you talking to me? What's your thought my business interests you? What other businesses are looked at? Why did you look at them? Why didn't you do them? Ask ask ask why? Why why before you open your mouth and say anything? Oh

Ed Mysogland  40:55  
my goodness, that's a that is so good. And, and and at the same time. It builds that empathy that you talked about, right out of the gate. So I'll have all your contact information in the show notes. And I I am so grateful I you know, there's there's been Yeah, I think we're I'm recording I think it was like 120 or something like that. And man, I have to tell you, I have loved our time together. It has been nothing but great. So I appreciate I know you don't have a lot of time and I know I'm you know I'm MBSE you've been on the board at the Rock and Roll Hall of Fame. I'm I'm envious of a lot of things you're doing so but I'm grateful for the time you spent with me because I know you don't have a lot. So thanks again.

Marc Morgenstern  41:41  
This was very fun. I enjoyed it.