This is a page from my book, “How I Sold My Business: A Personal Diary”
Jack, Marty, and I met with the two owners of this firm this afternoon, spending nearly three hours in one of their offices. This seemed a little awkward; after working with their employees for several days I would have preferred to meet offsite somewhere, but they assured me they would just tell their employees we were discussing other ways of working together.
At the beginning of the meeting they thanked me for helping them out of this jam, and tried to assure us this wasn't their normal way of doing business. I had already filled Jack and Marty in about what happened, and what I thought of their talent level, so I just said we were glad to help, and that their employees had great attitudes about trying to solve problems.
As the first owner ("Good Cop") warned me, his partner ("Bad Cop") was extraordinarily direct, more or less like talking to a computer. I could tell he didn't like small talk, and when I tried to politely say his employees were in over their heads on this project he brushed that statement off, saying they would figure it out and they would be fine.
I was sad to see that Bad Cop clearly ran the company, and had only one interest: the bottom line. As we met for nearly three hours, the entire meeting felt like an interrogation, as if I was a hostile witness on a witness stand. As the interrogation went on I kept looking at Good Cop, but he didn't say a word, and often looked down, away from making eye contact with me. Based on his behavior I felt like he didn't have any balls in this relationship, and I was very disappointed by his inaction in this meeting.
Bad Cop was only interested in hard-core financial numbers, and could care less how we did what we did. Jack and I answered all his questions, with the usual reservations that some answers would come after a Letter of Intent. All of this was well-rehearsed by now, and I felt like I was generally giving a speech I've given a dozen times before.
As some questions seemed to open themselves to opportunities to discuss business philosophies, personnel matters, and other "soft", non-financial avenues, I tried to ask questions about their philosophies, but those questions didn't go very far. Good Cop said a few words at these times, but very few, and my impression of him was blown by the third or fourth time I tried this technique, and I finally quit doing anything but answering Bad Cop's questions.
In fact, it got so bad that I wanted to leave the meeting well before the end of the second hour. Since Jack had already taken a break from the meeting, I decided to do the same thing, and took a restroom break, leaving Jack and Marty to answer questions for a while. On the way to the bathroom, and in the bathroom, a couple of employees I had worked with asked me how it was going with Bad Cop. In the bathroom one of the employees looked around to make sure nobody was in the stalls, and told me the good news was that Bad Cop didn't change much; whatever I was seeing in this meeting was pretty much who he is.
At the end of the interrogation Bad Cop asked if we had any questions, and for the first time in my career I said "No"; I just wanted to leave. To my amazement Jack asked a couple of questions, perhaps just to be polite. This marked one of the few times when I felt true pride in my company, and there was no way I was going to sell my baby to a pure numbers guy.
In the parking lot after the meeting Marty asked Jack and I what we thought, and I told him no way, and Jack agreed. Marty said he began to feel the same way when he talked to Bad Cop on the phone, but as our agent he was obligated to bring them to the table, and was hoping for something better in person.
Editor’s note, 2017: One thing I forgot to mention about this company is that in spite of the fact that this company was much larger than those by floor space and head count, I was able to confirm that their profit wasn’t much larger than ours. They focused on selling low-margin products and services, while we sold much higher-margin services and no hardware.