What Is Negotiation? An Introduction by Ramit Sethi and Susan Su

Why don't you start with 2k and you can work your way up to 10k. It's about understanding that negotiation is a principle. It's not an exact amount. Hi, I'm Ramit Sethi, the founder of I Will Teach youh Be Rich.

Hi, I'm Susan Su. I'm a freelance marketer and writer.

Alright, so I want to introduce you guys to Susan today because I think she has a really interesting story. But Susan, how long ago did we meet? Was it like a year or two?

Yeah, it was about two years ago.

Okay, so let me tell my side of the story as to how we met and then maybe you can tell your side because I bet there's some differences in how we think about it. Two years ago, Susan emails me and she says, hi, I'm a Stanford grad, I work at Google and I'm looking for a new job and I want your help on negotiating. And you could just tell, I mean, I get a lot of emails every day, but I could tell instantly that your email made you stand out. Right. It was clear that you were really smart. So how did I respond to that email?

Ramit was awesome. He responded faster than my co workers ever do to my email. So it was in less than an hour and in an hour after that we were on the phone. And then the next day we met up to talk about negotiations.

We met in a ghetto diner and the reason I wanted to meet you was because I could tell you were really smart and you were going to succeed in your negotiation. But I knew that we could get you to the next extra step. So I met her in a diner and I said, alright, I will agree to teach you how to negotiate if you agree to talk about it on camera. So we sat in this diner and we did a before and after negotiation where I pretended to be the mean, experienced recruiter and you were the candidate. Now you were pretty good at your negotiations, certainly more aggressive than most of my friends. But then, you know, I taught you some of the techniques and I filmed you afterwards and you just dominated. You remember?

Right. And I think one of the biggest things I learned from that conversation is that being friendly and gregarious and smiling a lot just doesn't cut it when it comes to a negotiation. You have to know the tactics, you have to be prepared with information and you have to have practiced. So yeah, before the practicing I was okay. You know, I knew how to represent myself. I'd been on this earth for however many years and I could deal with talking to people, but I did not know how to drive a conversation, especially a negotiation conversation, to get the results that I wanted.

So, quick story about the results that she got. So Susan got over $8,000 of salary increase and a 50% increase in equity at this company that she went to work for, which is amazing. It was actually a great salary to start with. And then you took it to the next level. Since then, Susan's. Now, you mentioned you're a freelance marketer and consultant. And. And you're actually making more than you made at that other company.

Yeah, I'm making far more money than I've ever made before in my life, which I didn't think was possible as a freelancer. And, yeah, really, I think I would estimate at least 20k more than I made at my last job, which is the one that Ramit helped me to negotiate.

And you graduated college how many years ago?

Gosh, almost four years ago.

Not even four years. Okay, so that's actually seems like a long time. I mean, that is a huge increase in salary and career. That's really leapfrogging what most people do. So what I want to do and what you can help us do today is talk about, how did you do it? We're going to cover some of the strategies, some of the tactics, and some of the mistakes people make when they go in to negotiate with that. Susan, can you tell us your side of the story as to when you approached me? What was going through your head before you started negotiating?

I was freaked out, basically. I'd been looking for a new job for a while. I was working at Google, and I was looking for a new job, and I got contacted by a recruiter. I was most of the way through the interview process. And at some point earlier that year, before I started interviewing for this job, I had actually started teaching myself about negotiation. I read somewhere that women typically don't negotiate their salaries at all, and that that was the reason for this whole salary gap between men and women in the United States. Not because employers were trying to undercut women, but because women really undercut themselves by not asking. So I looked on Amazon for negotiation books. I found this one. And when I went to my local bookstore to check it out, I saw the COVID You know, it's bright pink. It has these silly business women dancing on it. And I almost walked out of the bookstore right then and there, but I was really desperate, so I picked it up. I read the entire book, cover to cover, and it's. Gosh, it's almost 300 pages, and the entire Last chapter is actually exercises. It's role plays, it's worksheets. And if you could see the book, you'll see that I've penciled in answers to many, many of the worksheets. So I really took this seriously. I read the whole book, I did the exercises, and I really wanted to prepare myself. So when I was in this job interview process for my next company, I. I was really excited to actually get to work practicing my negotiation. The things that I learned in real life. Now, I didn't know what I was going to be up against. Negotiating with a real person, an experienced recruiter, is very, very different than reading a book by yourself at home. So I got on the phone with my recruiter, and we started talking about salary. We were pretty close to offering me the job. And I knew they wanted to hire me. I knew they wanted me to work there, but I was so nervous because I'd never talked about money with a real person like that ever before in my life. And despite everything that I'd learned in the book, I made the number one mistake, the most amateur mistake, which was I told the recruiter on the phone what I would accept as a minimum salary.

Oh, God.

So, yeah, that's the worst.

Okay, so let's just do a quick role play of that, because I'll be the experienced recruiter, and my only job is to get you on board for the least amount of money.

Right.

People need to understand that it is indeed fundamentally an adversarial relationship until you use some judo to change it. And you are the candidate who is actually more prepared than 90% of people. But you've read a book. So I'll be the mean recruiter. Okay. So, Susan, we really like you. Really interested. What I need to know now to continue this process is what are your salary requirements?

Well, I'd really prefer not to reveal that.

Well, I understand, but unfortunately, we can't go on until I have those salary requirements.

Well, I would rather know more about the job before I talk about my previous salary.

Well, we're certainly going to get to that. But like I said, unfortunately, this is it. I have to know the salary, or, unfortunately, we'll have to just end it.

My previous job was so unlike this job, and I really think this is going to be at a higher level. So I really don't feel comfortable just.

Looking for a ballpark. Even a ballpark here.

Well, I guess something like, I don't know, 60k would be my minimum.

Okay, that's fine. Now, what I'm thinking right now as a recruiter is sweet. I just saved $12,000 because she screwed up and told me her salary. Because my, my budget was actually 75k for this job and you told me 60k. So I'm gonna give you 61k. You're gonna feel great about yourself. And I just got a big fat bonus.

And what actually happened was. So I, it was very similar to that conversation. I blurted out what my minimum would be because I just felt up against the wall with this recruiter that I was talking to and he came back to me later that day, you know, just a matter of hours really later that day, and said, Susan, we have an offer for you. It's this job at X Salary which was the exact number. Not even.

What a coincidence.

Not even a thousand dollars.

What a coincidence. They just happened to hit it exactly on the head. Alright, so. So this is the way it works. If you tell them a number and it's below what they wanted, they will do it. All right, so let's do another role play where again I'm the experienced recruiter and you are now the experienced negotiating candidate. Okay, we're going to do the same thing and this time I'm going to put you up against the wall. Let's see what happens. Well, Susan, I'm really excited about possibly working together. What I want to do now, I need to get your salary requirements so that we can go forward. So what salary are you looking for?

You know, I would love to. First of all, thank you so much for calling me back. I'm really excited about this opportunity and I love you guys. I love the team. Why don't you tell me a little bit more about the salary possibilities for this job?

Absolutely. I'd be happy to discuss it with you and we'll do that. Right now what I need to do is I basically have a box on this form. I need to get your salary requirements so that I can kind of see if we have a good fit here. I don't want to waste your time and I don't want to waste my time.

Right, I totally understand. It's harder for me to name an exact number without knowing a little bit more about the role and the total compensation package and the growth possibilities. So if you could supply me with that or tell me a little bit more about what the company is thinking in terms of salary, then that would help me to name a number.

Sure, I'll certainly be happy to do that. I guess on your end, I do have a boss and he's going to need A number. So it doesn't even have to be an exact number. I just need a ballpark of what you would be comfortable with, and then we can kind of move forward.

What's the range that we're talking about here for a position like this?

Well, that's really up to you.

Okay, well, you know, I really don't feel comfortable naming a number without having a little bit more information, but I would love to talk to you more about it. You know, we can. You know, maybe if you can get me some info, I would love to come back to you and we can go from there.

Great. So you put me up against the wall, and I got uncomfortable, and actually, you're doing the right thing. You should never be naming a number. The first time you made me do it, and I was like, Mr. Experienced Recruiter, and I was very uncomfortable. Why? Because you're asking things that I don't have right now. So I had to go back to my boss, and we just did a little bit of maneuvering, and there's a lot more that can be done. When we did some practicing, we did a lot more.

And you'll notice that Ramit was pushing pretty hard. He just kept saying, no, no, no, I'm not going to give you any information. We need the information from you. I've got this box on a form making it seem like, oh, it's out of my hands. I've got to have this info. But as the candidate, you have no obligation to disclose any figures, no matter how the recruiter makes it seem. And if all else fails, if all of that, like, the turning tables doesn't work, you can always just say, you know what? I don't feel comfortable revealing that information. If you can get me back something, we can keep talking from there. Yeah, absolutely. And they're not, you know, they deal with. An experienced recruiter has dealt with hundreds of candidates in his or her career, and they're going to know what to do at that point, and they're not going to keep pushing because. And they're definitely not going to dismiss you because you won't name your salary. That's part of the game. And it's important for candidates to recognize that there's no need to cave in, no matter how necessary it seems.

Absolutely. Recruiters have their own toolbox, and they know every pressure point to push, especially with young people who are basically stupid and inexperienced and think that whatever is written on a price tag or an offer form is gold. And that's not true. Everything's negotiable so your point that you were making earlier was that you felt relatively prepared. I mean, you're already pretty aggressive, and then you actually proactively went out of your way to get educated about negotiations through a book, but you went up against a professional who sees hundreds of candidates a year, right?

Three, actually. So after my conversation with the first professional, in which I made a very amateur blunder by revealing my minimum salary that I would accept because I was nervous, I countered with a different number. I said, oh, no, never mind. I meant this. Blah, blah, blah, didn't go so well. And in response to that, they actually put me up against three professionals. Two recruiters, one of them the senior most recruiter in the company, and then a vp. So that is very, very intimidating. And at that point, you know, when I saw that I was scheduled for a meeting with three guys much older than me in tech, you know, a VP and a senior recruiter, and then my recruiter that I'd been in contact with, I knew at that point that, you know, as cool as this is, it wasn't going to cut it. And I needed some real help. So that's where Ramit came in. I had been, I guess. I read the New York Times. I'd seen him in the New York Times on one of the blogs, and I started reading I Will Teach youh to Be Rich. I saw that one of the posts was about how my friend negotiated $3,000 in salary increases or something like that. And I thought, gee, this sounds pretty good. I read the whole post, but I wanted more because I felt like, gosh, my situation is so bad, I already revealed my minimum I need. You know, it's like a negotiation emergency. So that's why.

That's a good title.

Yeah, Negotiation Emerg in and help People. So I emailed Ramit fully expecting to be just tossed into a pile of many emails, but I was shocked when I got a response pretty much immediately.

Well, the reason I responded was that you can tell when people are smart, as opposed to some of my readers who are very dumb, and email me saying, like, can you help me with my savings account? I have your book. I'm like, have you read Past Chapter one? Chapter two is the Question. It'll answer your questions. Okay, so anyway, I can tell you were pretty smart. And then when we did the negotiation for me, I mean, the biggest success for me is, look, I put a few hours of my time in and you negotiate, you know, $8,000 and a 50% increase in equity against three senior recruiters. That's a big deal, especially as a woman. So there, you know, as much as we hate to say it, there is a difference in gender. Women don't negotiate as much as often or they don't negotiate for as much. So. So let's talk about all these things. But for now, I want to talk about some of the tactics as to how we actually work to get you $8,000 more than a 50% increase in equity.

Okay, great. So, yeah, let's talk about the tactics.