The Heart of the Working People Part 3 ~ by Shlomo Klein

Try Listening!


Yesterday, I had the opportunity to facilitate a meeting between an inventor, his partner, and venture capitalists.

The meeting came about when I was at lunch at a neighbor’s house during a previous weekend and reacquainted myself with an old friend. Although we both grew up in Brooklyn, and he now lives near me in Long Island, our paths have not had the opportunity to cross.

We caught up as to what each other was up to recently. I told him that I was in the middle of editing my Young Adult novel for a December/January publication, and still had my day job of running a company in the beauty industry.

At this, he mentioned that he was the Director of Finance for a private equity firm and that his company was currently looking at another beauty company to invest in, wondering if I was familiar with them.

Responding that I was not, I proposed that his firm might be more interested in looking at my friend’s company that recently patented something for the beauty industry.

Fast forward two weeks later, and we had a meeting yesterday with my friend, his partner, and my neighbor’s company.

Picture this, an inventor with 30 years experience as a hairdresser, his partner, worth $200 million dollars, and the two private equity investors representing a 100 partner investor group that make minimum investments of $50-$100 million in companies. The money in the room was astounding, even more so was the complete disconnect of the three primary individuals that were running the meeting! 

Don’t misunderstand me, each one wants the deal done, but what was so surprising was that people don’t actually listen when the other asks a question. It seemed that everyone had a spiel that they wanted to say, and that was their main focus.


For example:

1) The inventor had a video showing the benefit of his product over the competition. He showed the video, everyone got it, and yet he said, “Let’s watch it again!” His partner and I both secretly motioned to him, not to do so. I get it, he’s proud of his invention, it’s his baby! He wants to share that with the world, but don’t waste time in a meeting of this nature.
2) The equity people asked, “how come no one else in the world has come up with this?”
        The investor answered (I kid you not), “if you took all the brains of my competition, and crushed them into a little ball, it wouldn’t come near the size of my brain!”
        Really? Bro! No one is denying that you have an incredible product. These investors wouldn’t have taken time for the meeting otherwise! But Business 101 says, don’t put down the competition.          It’s tacky.
3) The equity guys asked, “for the amount of money that you’re asking for, what are you giving us in return?”
        The inventor answered that he was putting up the patents as collateral.
        They then responded that it wasn’t enough, because there weren’t sales to justify the investment they were being asked to make.
        The investor responded with a long-winded soliloquy about I’m not sure exactly what.
       Now I was sitting there, knowing full well that the company already had sales and confirmed purchase orders, in six months, of over two million dollars!
       No one said it?! Why the heck not? I didn’t feel that I had the right to speak up, because I hadn’t seen the actual financials, and I didn’t represent the inventor, I was only the matchmaker.
4) The equity people didn’t think they could make the type of investment being asked, in return for only the patent rights. I was told by the inventor, the day before , that he would be offering an equity stake for the investment. During the meeting, neither the inventor, nor his partner said that they were offering equity. 

WHAT?!

Eventually, they did say that they would offer equity, but why did it take so long to answer their direct question? This wasn’t a negotiation to get an investment in return for an equity stake, the basic deal had already been laid out.

In the end, the product was so revolutionary, and the market so proven, that the deal will most probably go through, in spite of everyone’s not listening to what the others were saying.

This is an incredible life lesson that I learned. No matter if it’s a conversation between two people, or a multi-million dollar deal, people innately are more interested in hearing the sounds of their own voice, than listening to the other person. I can only hope that I spend more time in the future listening, than talking.

Shlomo Klein is a screenwriter, movie and TV/streaming series
Shlomo Klein
reviewer, and businessman who lives in Long Island, New York. His movie scripts include: John Ericsson’s Monitor – A historical re-telling of the events leading up to, and including, the battle of the Civil War Ironclad’s and Men of Midway - The story behind the Battle of Midway, the greatest naval battle in US history. The fight against the Japanese that turned the tide of war in the Pacific, and the men responsible for it. He is a lover of naval war ships and was originally inspired as a child by many visits to the USS Enterprise.

To connect with Shlomo, click the link below.





5 comments:

  1. It does seem listening is a lost art...

    ReplyDelete
  2. It seems in our society, listening is not a priority. Thanks for your insight.

    ReplyDelete
    Replies
    1. Thank you for giving me the opportunity to have people listen!

      Delete
  3. Welcome, Shlomo. Great post. We do seem to be loosing the ability to just stop and listen to others.

    ReplyDelete

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