Time Kills Deals

Posted on | June 7, 2010 | No Comments

While it is one of the most over-used phrases in the business world, I was reminded again last week that it is also one of the most true.

The bottom line for anyone trying to get a transaction closed, is that momentum is your best ally.  Whether you are on the buy side, the sell side, or simply trying to hire a member of your executive team, the passage of time almost always increases your risk of failure.

The biggest reason is basic human nature.  People are inherently resistant to change, and given time to over think the consequences of a disruptive transaction, will almost always drift back towards the comfort of the familiar (see ”buyer’s remorse”). 

In addition, the world never stands still.  New alternatives are always just around the corner, people’s personal circumstances change overnight, and we live in an age of very short attention spans.  

Creating a feeling of momentum around a slow moving deal, however, can be a challenge.  While time lines and closing checklists can help, I have found the most effective tool to be simple (over) communication. Don’t let silence suck the energy out of your deal – pick up the phone (even if you need to make up an excuse to check in).

So, I move forward, committed to following my own advice and with a renewed appreciation for an old saying:  time kills deals.  Don’t let it kill yours.

Category: Investments, Venture Capital

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