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Hi, I’m Brad Feld, a managing director at the Foundry Group who lives in Boulder, Colorado. I invest in software and Internet companies around the US, run marathons and read a lot.

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The Mouse Has The Elephant By The Toenail

Comments (2)

It’s the end of the quarter and many of the entrepreneurs I know are crunching hard to get their quarter end deals done. I was riding in the car with the CEO of one of my companies who is in a particularly challenging negotiation on a large deal. We were in a Jaguar that he’d rented from Hertz and he made sure to point out the sign in the car that said “Hertz #1 Gold Club: We appreciate your business! Please enjoy our complimentary upgrade.” I smiled – told him I knew he was cheap and wasn’t worried – and waited for him to say something like “yeah – but the point is that the Hertz Gold Club membership was free also.”

As we talked through the huge deal he’s working on, he described the negotiating dynamic he’s been dealing with. The end customer badly wants the deal to get done.  The deal is “stuck in procurement” and the CEO is negotiating with the “procurement officer” (not the end customer).  The conversation goes something like this:

Procurement Dude: “I think our relationship has become strained.”
CEO: “Strained? I’d say it’s hostile.”
Procurement Dude: “Well – you’ve got us over a barrel.”
CEO: “You’ve got to be kidding. That’s like saying the mouse has the elephant by the toenail.”

That got a laugh (apparently from the Procurement Dude as well as me).  It’s still a battle, but at least we got a good line out of it so far.  I expect that anyone that’s ever done a multimillion deal with a Fortune 1000 company has a similar story. Since we are a private company, we’re perfectly happy to wait until next month to finish the deal when the end customer even more badly wants our stuff.  In the mean time, the end customer has to cool his heels while Mr. Procurement plays hard ass for a few more weeks. 

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