How to Negotiate Your Salary Like a Fortune 500 Executive (Featuring Jacob Warwick)

As you think about continuing to grow your negotiation skill set, I want to invite you to Nashville, May 5th and 6th for the Negotiation Made Simple live workshop. This will be an opportunity for you to gather with other people from around the country. We keep it small very intentionally so that it can be very interactive and we can spend a lot of time coaching you and helping you not only become a better negotiator in theory, but also becoming more effective in your actual context and your actual practice. This can be a transformational 2 days, and I hope that you'll jump in and join us. We are selling seats, so I encourage you to do that quickly. There are some special offers out there right now. To learn more about this, go to LowryGroup.net and click on the icons that you see for the Negotiation Made Simple live workshop. Welcome to Negotiation Made Simple, where we help you master the art of negotiation and win the next deal. I'm your host, John Lowery. There will be, on average, about a half a dozen times in our life where we have to carefully execute a compensation negotiation. This is a high-stakes moment for many of us. To where literally our compensation, our quality of life, all of that gets determined by how this deal gets put together. Because this is so significant, I am really excited about today's guest. Jacob Warwick helps the top executives in the country manage this particular moment. And he's here with us today to share with us some concepts and some ideas that he's learned through his years of helping executives negotiate really significant contracts. But out of that, there come some principles, there come some ideas that I think can be very valuable for all of us. Whether you're a Fortune 50 executive or whether you're someone that is working their first job and having the first negotiation of your career, there is tremendous value in this conversation in terms of learning from Jacob about how to nail that moment so that you are compensated well for the work that you do. Let's jump into this conversation with Jacob Warwick. Well, tell us a little bit about what you do, how it is that you come alongside executives as they're trying to negotiate employment agreements or maybe having to exit for some other reason or representing themselves when there's a sale of a company. Talk a little bit about what you do and give people a sense of what that looks like.

Yeah, absolutely. So typically I'm working with, I would say, a VP or higher senior leader at a company that's $1 billion or larger, oftentimes in the Fortune 500 or in the Fortune 50, even typically right at the C-level or right beneath, right? So oftentimes negotiating directly with Mark Zuckerberg or negotiating with— we ran a negotiation against Sam Altman just a few months ago. We did one with Satya Nadella. Now they don't know me. I'm the invisible hand, so to speak. I'm kind of behind the scenes there. But when an executive is preparing for these tough conversations and trying to understand the value that they're bringing to the table, what I help them do is ignore benchmarks about what all of these systems say. And this is what's really tricky is that everyone starts to follow benchmarks. And I think that's handicapping them, right? They're no longer thinking about the value that they provide. They're trying to see where do I rank amongst my peers? Right, but if you're solving an exceptional problem, so maybe creating a larger pie, so to speak, right? Maybe— Sure, sure. You should be the outlier from those benchmarks. And so I teach them the language on how to communicate right from the first recruiter call through the interview process, the conversations they have within their network as they develop champions and advocates within an organization, whether that be mentors they've had for 15 years or peers or direct reports that are advocating for them at a company. I teach them how to master, typically through behavioral psychology, a lot of influence and persuasion, and honestly, a lot of tips from your book as well. They work very well through all of these. So if you combine your book with Robert Cialdini and Aristotle and maybe a little Dale Carnegie, you have the super piece of what's necessary to kind of navigate those relationships. And a lot of this is mindset coaching too, just, hey, never be so sure of what you're worth that you wouldn't accept more.

Mm-hmm.

That's what benchmarks do to folks. And so there are situations where, you know, hey, I was gonna ask for a million. You coached me to not ask for anything. They anchored higher than that. And we closed at $2.8, like $2.8 million a year more. And so when you talked about niching out your business, what I did was I created a very small upfront fee. I'd say relatively speaking to the value created, it's usually around 10 grand. Right, as a strategic fee. And then I take a percentage of the lift or I treat it kind of like a Hollywood contract. And it sounds like you were talking to a Hollywood agent here recently on the podcast. Yeah. I learned a lot of this while coaching Hollywood agents on the backend. Understand we were, we were doing deals with Nicole Kidman and Emma Stone. And like, we were doing deals on the backend with Chris Hemsworth and like navigating director relationships and putting movie deals together. And sometimes we've gotten million dollars more in a contract just for saying, I'm sorry. Like in an ego-filled position. Like there are some simple, simple tactics that can come through here, but essentially my firm started taking off when I applied value-based pricing to the impact and leaving about 90% of the risk on my shoulders. Like if we don't get there, you don't pay me. Right. If we do get there, you pay me handsomely, but only if you, you're always going to get 5 to 10x the return. And so it could be triggers on renegotiating your severance. It could be an acceleration trigger of a change of control. One executive actually accelerated all 4 years of his RSUs on day 1, quit a week later, and sold it all for $25 million. Now, I don't recommend people do that, but I'm just— I've seen some stuff is all I'm trying to say. And so that's typically how my world works. And it's primarily Silicon Valley and Fortune 500. Kind of VP+ talent that I'm working with.

So one of the things that strikes me as you're talking about your work is, you know, here you have very sophisticated business people. These are Fortune 500, sometimes C-level, other executive-level kind of people. These are people that are putting deals together all the time. I would assume that they are very competent negotiators. And yet the thing that I think is really, interesting about this is that they all felt the need to have a coach, to have another set of eyes, another mind to kind of be thinking about this deal with them. And obviously, you've been able to demonstrate some real value in terms of coming alongside them to kind of think through the deal to figure out how do we capture more, how do we make this a better deal. And so what do you think is the motivator in terms of people who are that skilled, who are that, uh, proficient in terms of this particular process, but still recognizing I need someone to come with me? Like, what is it that they see in that that's so valuable?

Yeah, that's, to be honest, it can be a difficult sale. The more active, the more successful, the more clout the individual has, the more difficult the sale could be. And there's a saying that stuck with me that it's, You know, I don't think I'm the best at my craft, right? And that's why someday I might be, right? So I don't think I'm the best, but that's because I'm constantly learning. And these topics, sometimes they'll have 3 executive coaches, they got 2 attorneys, they got internal HR, they got board members breathing down their neck. There's all kinds of things, right? And oftentimes having outside perspective is what tilts the deal in their favor. And now it's not easy, especially, I would say I get larger outsized wins with women than men, 'cause men tend to be more aggressive off the bat and just blaze through and do it, right? They just are hyper-aggressive on that end. So they tend to think they need less help, which I find interesting. Now I have also worked with a lot of chief revenue officers and they'll say, "Hey, we're the best negotiators in the company. We run the sales org," right? And then I look at their contracts And I go, if you're the best negotiator in the company, how come you have the most volatile contract of anyone on the C-suite? Because the product guy or product gal gets paid no matter what. You only get paid if there's performance for X amount of things that you can't even vouch for. Right?

Sure.

So sure. There's some blind spots that we all have. And so what I've done is exceptionally difficult, but I've had probably 30,000 one-on-one conversations with executives over 15 years. More. I mean, just muscle memory, repetition, learning the craft, understanding, a lot of empathy about what they're going through, those types of things. I've really dug in to understand every nuance there. And then with my business model, I tried to charge a lot. I've sold $1,000 an hour. I've sold $2,500 an hour. I get the pushback on like, okay, that's a lot of money if I'm talking about early stage negotiation. But if I'm right in the trenches, in the back and forth counters, that's a decent amount. And then I started realizing, like, I had a guy, it was $1,000 an hour. It was probably 6, 7 years ago. And I was, I was stoked. It was the first time I charged 7 or, uh, 4 figures, I guess, for an hour.

Yeah.

Right. Yeah. He bought 4 hours of coaching. That's all it took. We moved his deal from $800,000 a year to $2.4 million a year. Right. So massive lift in his cash. We was a back and forth Snapchat versus Google YouTube at the time. We were going into a bidding war over this engineering talent. And love the guy to death. I made 4 grand and I was like, oh, maybe you can send me a tip because that was well over $1 million a year in bonus. And he mailed me a $5 bottle of wine. And I was like, I need something to change here. I go value-based pricing instead. Now value-based is really risky because if you can't provide the value, you don't get it. Now, a lot of coaches like to live on hourly and they like to live on retainers because they know they're gonna get paid whether the impact's there or not. Instead, like I had to de-risk it as much as possible. I'm like, look, like there's, there's $2 million at stake here. Give me $10,000 deposit. That's all you risk to lose. And I will take only what we win beyond what you think is possible here. And they're like, great, whatever you, you get a fifth of what I win or a quarter, or what I've, I've played around with 10%, 20%, 30%. People voted on 30, except when the wins are really big and you're getting a couple hundred thousand dollars success fees. Then they start looking at, well, after taxes, I'm losing this amount. And you know, they start doing the math a little more. So I've kind of found a sweet spot on the percentage and triggers, but you, I've had to de-risk it as much as possible. So even when, like, these are great negotiators, but negotiating for yourself is a different ballgame. And it always is. There's a little more emotion attached to it than simply acquiring a company and stripping it for parts or those types of things. There's more, more to it than that.

And that's the dynamic I really wanted to get into and wanted people to hear about a little bit is things do change when you negotiate with yourself. And I think you're right. I think emotion has a lot to do with it. And I also think that, you know, there's a little bit of ego that plays into that, but there's also a little bit of fear on the other side to where you want to protect the value, but you also, it's, sometimes difficult for people to really promote themselves. And so they end up hedging in the context of an employment negotiation, and they probably settle for something that is far less than what they're actually worth or the value they're actually providing the company. Um, I've seen it kind of time and time again. And so the idea of bringing together some group of people or a particular person that can help you think through these kinds of things, that can be the objective voice and can give you to give you courage in the midst of this negotiation, that can be a really good strategy and a really good thing for people to do when they feel like sometimes their emotion can get in the way of their judgment or objectivity in terms of driving the deal.

Yeah, that's a bit of how I work in that I'll have somebody send me 30 pages stream of consciousness on how they're feeling. I'll have somebody send me 10 years of employment documents and agreements and negotiations that they've done that I have to sift through. Right? I am the dumping board. I am the filter. So I always ask, I ask people to treat me like an attorney, albeit I'm not charging like one, right? So your boss says X, before you respond, send it to me. We calculate it and we send back the response. You tell me all the things you're feeling. If we need to hop on the phone, we go through that and we elaborate. What are you feeling? What's happening? This is stupid. This isn't, what's the context from this? Whose relationships are involved here? Right? Does the CEO of your company know that the CEO of another company is trying to pilfer you and all 6 people on your team? Right? Is that a possibility? Oh, it is a possibility. They do know each other. So they know the competitor in this instance. Then there's talk track here and there's prior. Like we've seen someone on the board of directors is also on the board of directors of this company that I'm working with. I did a negotiation last year between eBay and Etsy and a Walmart. Right. And some of those board of investors are on the same company. Right. And so as we're negotiating, we gotta be careful with, with who's saying what and why, and, you know, to, to bring back one last point that people are afraid and they start hedging. Now that's not because they shouldn't be negotiating. It's just because they don't know how, they don't know what to say necessarily. It's not that they should give up. It's that they need to talk through it a little bit more and Too often this is an uncomfortable experience, and especially if you've been out of work for a while, or if you have at-home pressure or financial pressure, like you want this pain to end, but every, every seasoned negotiator knows that haste equals risk. Right. Yeah. And so if somebody wants to end it in 3 days, I might make that negotiation 3 months. Now, if I were on a monthly retainer or an hourly, like an attorney, people might say like, you're just dragging this out to increase your fees. That's why I had to build a fee structure. It was like, look, like I want to get it done as efficiently as possible. That's not the right move. You cannot move this quickly here and here's why. Right? And then sometimes it's just buying them 48 hours to think about it. And then all of a sudden they go, yeah, I do have a different take on this. Or yeah, there is more value here. Or I did see a different angle. And then everyone's just so focused on like, let's get this pain away. Cause it's uncomfortable that we don't embrace it. But being uncomfortable is where you grow. Right? So when my clients are like, man, I'm uncomfortable about this. It's like, good. We're growing. We're learning here. Let's talk about why. And then additionally, too many think about negotiation way too late in the process. They wait until there's an offer made, not knowing that they've been negotiating their leverage for 18 months in a deal with their relationships, with everything they say, with their back and forth correspondence. We have to unpack all of that. Right? So they, they think about it a little bit too late. And then they also think about it as a confrontation, like, oh, I don't want to piss off my boss, or I don't want to upset the political capital, or I don't want him to put his head on the chopping block for this, or whatever that is. And I think you wrote about this in your book, but you've certainly seen it. Like, we, we should think about negotiation as a collaboration, right? Where we put the challenge in front of us, not between us. So John, you and I both want this to be the most successful podcast that you've had. Right? What can we do together to co-promote it or to do like, what, how do we work together to make this thing better for both of us kind of thing? Now that's also not to be confused with win-win negotiating, because I don't think I honestly don't believe in win-win negotiating in the same way that a lot of other negotiation folks do, because in an employment agreement, I always feel like it's win-lose. And the reason being, the more you grow in your career, the less money becomes important to you. Money is becoming, especially for senior executives, like you got a couple million dollars in the bank, you're optimizing, you're pushing, right? So money is constantly being devalued, right? It's being inflated. It's being devalued over time. Yet your time is increasing in value. So the older you get, your resource of time becomes more important. And money becomes less important. And so what companies do is they chase that resource with money and those two things come at odds. And so if you're gonna be doing something, you might as well push, right? These companies can afford it in many cases. And I'm, I see, again, I'm talking about billion-dollar-plus companies, startup negotiations, early stage that I'm very familiar in that space as well. We're often negotiating equity and performance bonuses based off of valuations and those types of things. So kind of a different ballpark. Right. But you should be fearless in this because at the end of the day, it's like you're trading your most precious resource for something that's constantly devaluing. And you can spend only so much money in the rest of your life. Right. And maybe you have legacy goals and those things, but those are some things to be mindful of that should give you encouragement and confidence to go after it.

So what I'd love to do, Jacob, is really kind of just break down this process for people and go kind of stage by stage and get your insights on each particular stage. The first stage is really thinking about before negotiation ever happens. And in that stage, you really want to build leverage. How is it that an executive builds leverage long before the negotiation ever happens?

Yeah, so there's a couple of points that I see executives make some mistakes with, one of which is on the first recruiter call or a screen. Oftentimes the first question is, hey John, how much money do you want to make here? Right? Now, it's an awkward question to answer. It's almost an illegal question. Like in many states, you can't ask how much somebody has made, but you can ask how much they want to make, right? Which is another way of anchoring, right? And you anchor yourself low. Like let's say you anchor low, you're not the executive they thought that you were. You anchor high, they don't even bother with the process 'cause of all the back and forth. You anchor right in the middle and you don't have the opportunity to increase the scope or add more pie, because even in through the process, they increase the role for you. Let's say they add another team, they promote your title or whatever, and then you push back on comp, they say, oh, but you said you wanted $450,000, right? Or whatever. So right from the get-go, you need to understand how to answer that, which is something along the lines of, you know, I don't talk about compensation this early. I'm open to having this once a written offer is ready. However, I have no hesitation that you'll put something competitive if we're the right fit, right? Something along those lines. You could then ask, was there a range you were hoping to stay within? And then turn the anchor around on them to see if it's worth your time. I recommend that for really seasoned negotiators or folks that just don't want to waste their time, right? That can be helpful. Oftentimes small deals can be turned into much larger deals through the process. So I wouldn't necessarily recommend giving up on that. Now, I think another way that we egregiously make mistakes with leverage is how we overshare on social media and with things in the public, right? And so an example on LinkedIn, we often share a lot of our tactical things. So let's say I'm working with a client. They're a startup guy. They go zero to $200 million. They go, they, they brag about, oh, in 18 months we went from $25 to $50 million. We led a team of 12. We did, all of these statistics and numbers to validate their leadership, but they want a job at a larger company. They want to work at a bigger firm, but the numbers they're sharing are their subjective value. To some companies, that's valuable. To others, they're rounding errors, right? A $20 million lift is a rounding error to Morgan Stanley, right? Those types of things. So sometimes we overshare numbers and we shoot ourselves in the foot from even opening up the conversation in the first place because we, pigeonhole ourselves in to what have you done for me lately. It also works on the inverse. So I had a VP of engineering client at Oracle, and he led a team of 800 engineers, which is impressive. Why wouldn't you want to share I led a team of 800 engineers? Now, when he was talking to me, he said, Jacob, I can't get a startup job. I want to work at a small team. I want to roll up my sleeves again, you know, like 100 engineers, 100, like the glory days, the part where I had the most fun, you know, I was building, I was hands-on, like, He wanted to relive that moment. It's like, well, first of all, take down that crap off Oracle. Because what happens is, is a society, especially American society, we assume that everyone is going up and to the right. Like capitalism has taught us that, like the markets have taught us that. And so if I wanted to reach out to John and I had 100 engineers like, man, that guy's impressive, but he's not going to want a job this small. I'm not even going to bother. And so you don't even have leverage. You don't even get an opportunity to have leverage. And so these are some common mistakes. What we can do to combat that is to control our narrative through how we network and how we appear in public places. So if we're talking to people in our network, we say, you know, I've historically had a Fortune 500 career, but I've been itching to roll up my sleeves again and do this. Do you happen to know of 2 or 3 other people I can talk to? So you can run counter-narrative vocally and you can control the flow of information versus a broadcast system, right? And so I learned this mistake from growing businesses. So I have a marketing background and marketers really have this mistake where we think if we build it, they will come, right? We should have the best copy, everything, like everything is beautiful. The product does this. And then the engineers change the product and we have to spend 6 months changing the website. And meanwhile, the sales team's closing deals already 'cause they can change on the fly, right? They can change immediately 'cause they just say like, this is the way it is now. So you have to sell first and market second, right? So maybe even this works for you, John. Like for example, you built a long-term career before you made your stamp with the book, right? Now, if you decided I'm gonna do something completely different, I'm a sports agent now, you know, that's at least still tangential to, the negotiation work, right? But now you have to be re-known for that, right? Now you're hard on— and you, I think you mentioned legal, like a lot of litigation and legal. And so that in itself, those words carry connotations which may or may not be good, right? So you mentioned litigation, I mentioned compensation and increasing comp. So people from my end might expect, oh, I'll pay him if he makes more money, Litigation might scare me because attorneys are intimidating, right? Yeah. Some people have a negative perception of attorneys, you know, so there's all of these word choices that we choose to say, even on your own podcast, will serve one market and not another. Right. So there's a lot of just mindfulness that we have about a lot of those things.

Great points. Great points. Let's talk about timing. Timing is critical. Tell me a little bit about how it is that you advise people in terms of timing as it relates to these particular negotiations.

Typically, I very much want to slow it down in a lot of ways. So I want the company to have urgency and for you not to. That's ideal. So a lot of folks— there's a, there's also a misconception I think we can talk about too regarding timing. When people— there's a— the common thing is when you have a job, it's easier to get a job, right? When you have a job, it's easier to get a job because your timing isn't rushed, right? Now, when people are out of a job, they tend to act with more urgency, right? Now, if you have enough money in the bank, I'd argue you don't need to, right? But if you display the behaviors of someone more urgent, it devalues your career. So if you don't have a job, we simply can't display that urgency. You may have it very real, but I will coach you on how to not show it. That will drive your contract up. Right. So I think that's a myth, right? It's a myth that it has to control you. It's very true that it happens, right? So when somebody has a job or they can say no, which is the ultimate leverage, right? They can say no to any deal cuz they're happy. Right. They have much more control over the timing. And so what we want to do in a competitive situation is we want to outlast the other people that are being interviewed. Ideally, we've done enough of a job to create competitive distance between us and every other candidate so that John says, man, we talked to 6 people. I can't live without Jacob Warwick Warwick Warwick. Then if I pull back and I'm harder to get, you're going to have to extend forward because you don't want to go through the other process because you fell in love with me. And in these types of deals, if there's only a handful of people in the world that can do your job, it might be another 6-month search. And another 6-month search means 2 more quarterly reports to, you know, the stock market that aren't getting— you have no announcements to make, your PR firm's behind. And you start looking at it, I gotta go 6 months more with a search firm, that's $300 grand, or that's $500 grand. And I gotta go through and I gotta get my top 10 executives on the phone call at, $2,000 an hour, and I gotta interview them for 10 hours to try to find the right Jacob Warwick Warwick Warwick, but I gotta do that times 5 people, right? You start doing the math. It's gonna be a lot easier to give me another million dollars than it is to go back to the drawing board. So talk about timing. I would like my clients to be able to slow it down now, not to be rude or disrespectful about timing by any means, right? I'm not suggesting, oh, I'll make my decision in 2 months. They'll move on without you. Right. And it's not just about, guiding them along. But it can be things like, hey, I need to review this over the weekend, right? Or I'm wall-to-wall with calls for 3 days. Let's schedule a conversation on Thursday. Now you might be available this afternoon, but I want you to schedule it next Thursday to slow it down meaningfully, right? So that you have more time to collect information and you have more time that really that information collecting, right? Negotiation's all about information, timing, and power, right? So you need to collect more information. And one of the reasons I mentioned win-lose earlier, employers negotiate every damn day. They employ, they negotiate employment contracts and executive contracts so much. There's so much information asymmetry here. A top executive might make 6 moves in their career, meaningful ones where they negotiate well, maybe less, right? They do 6 a day. Right? Yeah. And if you're arguing, oh, the band is here.

Yeah.

There's a ton of information asymmetry, right? And they have information on what you'll take, right? They have so much more information than you do that you almost have to play dumb and ask them to break the rules, right? Can you help me understand what that looks like? So you want me to solve a $300 million CapEx problem, right? Yet you're offering me middle range. Can you help me understand your logic there? Right? And the reality is, and this is what really baffles me, when executives fall into the trap of living within ranges, it's like, you're an executive, you created the range. You know that people just made those, right? Can you influence and persuade the people that made them to change them? Because the answer is yes. And oftentimes your job's to come in and remove 5 people from the team bring in 3 people of your own. Now you might say, look, you know, part of my job here is you want me to bring in A players and we don't offer severance right now. Now, when I bring in these 3 folks, they're going to ask about this. What should I tell them? So I'm negotiating on behalf of a future situation on people that you want me to bring in to do my job well. That helps me solve my current problem and the later problem. So we can frame things such as, look, we can't be offering middle percentile here. Now, I'm happy to work with you through it, and I'm happy to be more performance-backed or milestone-based, but I won't be able to attract the right talent for us if we don't solve these problems, right? And so let's work together on what that looks like as we reorg and move things around. And that takes time. It takes time to have those conversations with the right people. So that's, to answer your question, I want to drag it out so that I can collect more information so I can understand how to expand the pie for everyone and make it better.

Yeah. The next phase of this really is thinking about positioning. You've already talked a little bit about this, but the whole idea of positioning is there is sometimes the reality to where the position may not be as strong as you would like it to be or maybe it is, but the substance really kind of speaks into that. Then there's the perception, which you do have a lot more control over. In terms of how you communicate and how you position things. And so, talk a little bit about that phase in terms of how you help people with managing the perceptions and as a result of that, also then managing expectations a little bit.

Yeah, this is a great question. The— 'cause oftentimes you're more valuable than what a company can afford. Right. And what do you do in that situation? Especially if you have urgency, you need to pay the mortgage. Do you put your tail between your legs and accept their low offer? Or do you say, look, I was likely more horsepower than what you were intending. It sounds like we're both aligned. We want to work with each other. We want to make this work. Are you open to a 90-day contract to hire position where we start at this rate and I offer you 20 hours. Instead of full-time for that pay. And we can assess whether or not we can find the path to move forward. So we continue the interview process, but we get paid through it. And I get to say like, I was likely more horsepower than you're anticipating. I understand that, but we've fallen in love through the process. And honestly, this is where I want to be. It sounds like we can't make it work today. Here's some alternatives for us to experiment with. Like you can hire me for a million bucks. "my last W-2 was 3, maybe that's worth a third of my time. You know what, I'll give you a deal and make it worth half my time so we can explore it," right? So you can give concessions in other ways and keep the conversation going and solving some of the problems. And then if you're in an active job search, which is like chewing glass, it's a lot of work, right? Maybe you're getting paid—

Yes, it's a full-time job.

$50,000, yeah, maybe you're getting $50,000 a month to work half time. And then the other half the time you look for a job and network, right? So at least you're getting paid. And for these exec— a lot of the executives I'm working with, like if you're out of work for 3 months, that's sometimes a million bucks, right? That's a million dollars in missed opportunity. And then you compound that over their career. It's like $5 million. They start to stress out, right? As they play the market and all the other things. And so even if I can just accelerate somebody's job search a month, like my services pay for themselves. In one way. Sure, sure. Now, it's a little counterintuitive when you're trying to drag out the negotiation, but the more leverage you have, the more you can do that. I had a client who had a $4.5 billion exit as a chief revenue officer, made somewhere in the 8 figures on his exit, doesn't have to work but wants to. Lots of private equity firms trying to place some companies chasing after him. And the strategy we employed was, look, don't give all your services to one of these risky AI startups necessarily. We played 3 at a time on 90-day contracts on temp to hire so that we can assess the fit, build the relationships. And it was $1,000 an hour across the board. So he was doing 15 hours at $1,000 an hour. He was doing another 15 at $1,000 and 10 at $1,000 on 3 different companies. And he cycled those every 3 months with the opportunities to see which team he enjoyed working with the most Then we negotiated over a million-dollar deal to come in at that position with the right equity and expectations. 'Cause we got to learn through those experiences and collect more information while still getting paid. 'Cause that's also the concern. Like, I don't wanna just interview forever and not get paid and give up all this free consulting. Let's get a deal to the line to get paid and then negotiate. What you can't negotiate today, sometimes you can negotiate tomorrow.

Yeah, it's a really interesting kind of crawl before you walk, walk before you run approach.

—de-risks it.

But it's also, yeah, but it, and that's what I was just going to say, it's really valuable though, because essentially what you get is a 90-day interview that provides information to both sides. And like you said, you get paid during that 90-day interview. So that can be a really, really good thing. All right, so moving on, just the last couple of phases here that I'd love to get your insights on. Communication. So now all of a sudden we start communicating Obviously, this is an interesting communication moment because there is some level of cooperation that you want to bring to the table because this might be a place where you actually want to go work and this might be a position that you're actually really excited for. However, my guess is, is that you would say that communication has to be really managed though in order to protect your leverage, in order to be able to get the deal that reflects what you're worth.

Correct. Yeah, I'm glad you brought this up too, 'cause I have a couple hacks for this. It'll be tactical for listeners. Now, oftentimes I'll say something like, you know, I'm working on a deal that works for everybody, right? I need to align kind of all parties here, and I want to push while being reasonable. If you were in my shoes, what would you ask for? Like, I have a lot of respect for you. So knowing what you know about the company, What would you ask for? Where are the levers? Right? So putting it on them to have empathy. Now, this doesn't always work, but this can be helpful. Now, I found this really work with female negotiators as well. We can build sisterhood moments through that. High-profile executive women looking out for high-profile executive women. So you give them— this is a— I think this is a Cialdini principle, but you give them a reputation they want to withhold, that they can't discredit. So I would say something like, you know, it looks like you've always done a great job supporting female leaders. Now I could say that to a woman or a man. Now, can you rebut that at all without looking like an asshole? You can't say, no, I don't support female leaders, right? You'll look like an asshole. So you give them a reputation they want to withhold, right? So when talking female, talking to female here, right, they're saying something like, You've done a great job taking care of women. I would love to learn from you, be mentored, whatever. Right now, knowing that we have to look out for one another, what would you do if you were in my shoes? How do we win this together? So I'm bringing them into my side. I'm hugging them and saying, like, the company is here, help us negotiate so all women rise together. Right? Men can play this game too. I'm just using that as a very tangible example because women are often scared to do that. Or have hesitancy because they can be perceived as a bitch or overly aggressive. We're not taking aggressive tactics. We're taking collaborative tactics. We're using influence triggers like Robert Cialdini's Influence is the fricking playbook for this, right? And even for sure, and Dale Carnegie, as much as we like to make fun of it, How to Win Friends and Influence People, it's like using the names and being associated and building shared identity and the reciprocity and You're triggering the shared identity of female executives not being understood, and we have to look out for one another and girl power. And you can rally that without being so annoying about it. It's not like you're just like hype, like, you know, girls, you know, it's, you know, you're saying like, I respect you for this. I've seen what you've done throughout your career. It's one of the reasons I want to work with you. And you cannot deny those things. Otherwise you'll look like a jerk. So they now are programmed to want to support that. And then you say, okay, now put your money where your mouth is. And a nicer way of saying that is, if you were in my shoes, you know, go back 5 years in your career, John. If you were in Jacob's shoes now and you were going on a podcast, what are some of the things you wish you said? What are some of the things that you wish you did that you know now that you didn't know then? Kind of thing, right? So you're— we're taking You win it through questions, through thought-provoking questions that give people great reputations that they want to withhold, and you make it their idea. You don't say, other people in my position make 50% more. I want that because then they can come up with examples. We want them to rally together and make it their idea. It's not risky to do this.

And I love that idea too, about how you're, you're kind of encouraging people to get away from the objective criteria that really will hold them back and trying to get to what you described as kind of the value in terms of what will be created and how do you share in the rewards of what will be created. That's a really interesting perspective that lots of people kind of need to embrace because you're right. The fundamental HR strategy is the objective criteria. Here's the range. We're going to try to put you in this range and all of that can be very, very limiting in terms of how we do this. So we've got a few minutes left. Let me ask you a couple of questions about just people that are kind of going into this process. First question, and these are very like tactical questions, okay? Sure. So first question is this, like, is there a particular contract clause that you say is a red flag? If they see this or if this gets, if this gets really pushed in terms of the company or the organization that they're talking to, is there a particular clause that's always kind of a red flag for you?

Yeah, there's typically a lot of them that can be interpreted many ways. Now I'm, I'm not in litigation intentionally, but it typically extends around the trigger clauses on equity because a lot of a lot of executives will be mostly compensated with stock and changing control triggers, like a single trigger versus double trigger versus no trigger, those types of things. You can't accelerate your stock. You can't— sometimes you'll get cut before a vest date, those types of things. Those are red flags, right? You need to be mindful of that. Now it can be helpful. And I was just on the phone before this podcast with an employment attorney to talk through some of this, because You don't want to come across as litigious through your negotiation. And so as you are negotiating, right, I want to go through the big boulders first. I want to talk compensation, bonus structure. I want to talk equity. I want to talk milestones, reload bonuses, retention bonus. I want to get the big money out of the way. And then I want to talk about severance and contract language and the divorce and all of that stuff later, because I want to win them over and win everything that I want there. And almost come to expect those things to be there and be how they should be, and go into that playing dumb and acting surprised when you don't get it. Right? So you get the offer, you're ready to sign it. Like everybody's at the finish line. And then you say something like, oh, can you forward over the severance agreement and what some of the triggers look like on the stock clauses? Right? And then they go, oh, we don't have a severance agreement. Oh, we don't do this. And then you can play a Chris Voss favorite, which is, well, how am I supposed to accept that? Right? And then you can start the conversation again. Like, they're like, this is right at the finish line. The deal is done. It's right there. And then we just have a couple of little red lines to do right now. In this case, you can push it on to an employment attorney. At some of the levels I work with, many folks will have employment attorneys. Some won't. There are things we want to be mindful of. But those are things that I'm typically looking for. You always negotiate the terms of your divorce before your marriage. That's when you have the most leverage. And so I want at least 12 months for my clients, if not 2 years, if we can get there. Those are kind of relics of the past, but 1 year is happening quite frequently, at least 6 months on, at a minimum, you should be getting at, at these $400,000 base salary and, and, and over positions.

Yeah. And then what's one thing that you would advise someone that's kind of going into a contract negotiation, whether it be a renewal of a contract, whether it be a new organization and a new opportunity for them, as they're just kind of approaching this process? What would be one thing that you would say, like, here's the, here's the best counsel I can give you in the course of 2 minutes?

I would want them to be very mindful about the value that they're providing to the company. And what happens if you quit on Monday? What happens to the company on Tuesday? Like what happens to the team? What happens to everyone? Like what falls apart? Like what, what impact have you actually had there to understand where some of your leverage is? Those are some things worth considering. I would also consider that you make a habit of always having alternatives, right? Whether that be your own peace of mind and financial stability at home, having counteroffers or always checking the market, you should have a habit or a KPI, so to speak, of meeting 1 to 3 new people a week so that you don't grow stale, especially if you're 10, 15 years in a large company. All of your network is within one organization. You need to break that mold so you don't become trapped because optionality is what creates the most leverage. And if you see the company has no option without me, you have leverage. I'm not saying wave it around like a stick of power, right? I'm saying just understand it so that when you ask the questions through the contract negotiation, you can find where bigger opportunities can be made for everyone. Yeah, that was under 2 minutes, right?

That was a great advice. Yeah, I think you definitely did it and you provided some great insights. I mean, what you just said about optionality really coming through relationships and being intentional about growing that network constantly, That's really, really important for people to hear because that right there is leverage. And so many opportunities come through. There's some relationship that sparks an opportunity in so many of the cases. And so constantly doing that is, I think, just really sound advice and can help people not only do better at the table, but can also help advance their careers in terms of opening new doors as well.

And you know, it's not what you know, it's who you know. And to develop a great network, you give more than you receive, which is a Cialdini principle of reciprocity. Spend two-thirds of giving value to someone else and you will trigger reciprocity when it matters. Yeah.

Well, Jacob, listen, I'm really grateful for your time. This has been really interesting in terms of kind of extracting some of these lessons from, the executive compensation world and kind of how it plays out. What's fascinating about it is, I think there are some lessons here for all of us, even if we're not a Fortune 500 company CEO. There's so much out there that asks us to think about what we would do and how we would mimic a Fortune 500 company executive leader in terms of what they would do and what we could learn from them. This is a powerful way in which, you know, for those of us that may not be at that level, but the reality is, is we'll still have to negotiate employment contracts. We'll still have to negotiate exits. We'll still have to negotiate those kinds of things. And I think there's a lot of principles here that can be equally applicable to those folks that are dealing with things, regardless of whatever level you're operating in.

I will add that all of those tactics work at every level. I use the largest ones to show how big of an impact, like the numbers are sexy, right? Oh, $1 million here, $3 million. That's sexy, right? We've broken ranges from initial offers of $150,000 and landed at $600,000 all in. And we've broken ranges at $250,000 to $1 million. You know, if you even negotiate $25,000 more for your son or daughter who's just outta college or those types of things, think about how that compounds over the rest of their career and think about those lessons earlier. I'm sure you hear this a lot, John, but it's, I wish I knew about you 20 years ago. Right? I hear that all the time. Right? I wish I knew how to do this 20 years ago. One $50K lift over 20 years is a million dollars. And it's significantly more than that because of the new precedents you set, the new confidence you're under, the new expectations you have. So it's very important. I mean, it's highly lucrative. I'm, This is probably one of the most valuable podcasts you can listen to just to, just to go out and experiment and try it.

Yeah, and one of the things that I've learned over my career that I think people need to keep in mind is that their salary kind of stacks opportunity by opportunity and position by position. And so when you're negotiating for this particular position and the compensation associated with it, what you're actually doing is you're actually setting the stage for the next 3 or 4 compensation negotiations that you will have. And so, it's really, really important to pay attention to that because like you said, there is a compounding effect in terms of the value that you will create and how that value flows to you and your family.

And there are situations like in a private equity buyout as an example, where they look at the entire staff's salary and then have a formula on how much equity they're gonna give you because of that. So if you were less on that, you're making significantly less. So they just follow a formula. And I've seen— Follow it. I've seen C-suite female leaders get $3 million while their male counterparts get $12 because they follow the same formula, right? And when we push back for her, we couldn't get it 'cause they're like, hey, there's, this is black and white, sorry. Right? So it compounds in ways that sometimes you don't expect and it can bite you in the ass right when you least expect it.

For sure. Well, Jacob, thanks for these important lessons. Thanks for your insights as all of us think about compensation and think about value and think about what we're worth and really appreciate your good ideas in terms of how all of us can maximize that. I think there's some great lessons for us as we move forward and we'll look forward to hopefully seeing you again soon on the Negotiation Made Simple podcast.

Thank you, John. Yeah, I got a couple more hours in me, so hit me up anytime.

Sounds good, we'll do some more. Well, I hope you really paid attention to this conversation. I know that I certainly did because the subject matter of this conversation is so important to all of us, making sure that we're properly compensated for the work that we do. Jacob Warwick just dropped some nuggets of wisdom and some insights that can be so exceptionally valuable to us. This idea of leverage and being careful about the narrative and how it is that you position yourself, thinking really hard about how it is that we bring value and how to base the negotiation in our value as opposed to a range or comparing it to some statistics and things like that. All of those insights I think can be very good to maximize how it is that we can manage these very important negotiations for ourselves, for our careers, and for our families as well. You can find more information about Jacob at thinkwarwick.com. He's got a lot of information, a lot of resources there if you want to learn more about how to manage these high-stakes negotiations very effectively.