Not Every Deal is What it Seems -- Even Lawyers Need to Think Outside the Box, and Understand their Client’s Rationales
Brian Heller
Tech Deal Lawyer (SaaS / Cloud, AI, Advertising, Licensing, etc.).......... --> 20+ yrs experience: BigLaw, In-House, BizDev, CorpDev, etc.......... --> JD/MBA (JD cum laude from BU; MBA from Michigan)
In 2009 I was working at AOL when then new CEO Tim Armstrong came in from Google. He wanted to do a huge new deal to create original content – cartoons starring Warren Buffett, Gisele Bündchen, Martha Stewart and the late Carl Sagan.
I was working on these deals as a young kid at the time, and was buried in the weeds, looking at legal terms, fighting over revenue sharing, trying to ensure we’d maximize our chances of making it be profitable.
I was in Tim’s office asking some questions about the contract terms. I got brave, and asked him (very diplomatically, in my most Columbo way possible (“help me understand”)): this deal seems like it will lose money and the terms aren’t great, so why are we doing this?
And then I learned, not all deals are what they seem. Sometimes the reason for doing something is not the most obvious reason. First, he asked me how much press attention these deals were getting. Then he asked me, if we wanted to buy that much publicity (not even possible, but if we could), how much would that cost? That was my 'aha' moment. These deals were all over the news.
We were doing it solely for the priceless Earned Media value. Once I started looking at it through that lens, it actually made sense.
You’ve got to go back to 2009 and try to remember – AOL wasn’t dead yet. And these deals were newsworthy at the time. These deals were not just getting covered in nerdy tech news like Tech Crunch https://techcrunch.com/2009/07/24/coming-to-aol-warren-buffet-and-martha-stewart-cartoons/
These deals were also being plastered all over all sorts of mainstream media, TV, print, and online, including:
And so many other places.
That was the only reason we were doing these deals. We didn’t need to make a profit on the deals. Many of the terms I was scrutinizing and fighting over just didn’t matter as much as I thought. It wasn’t just because the CEO wanted to a vanity deal with his famous buddies. It was because the deal made financial sense for AOL, once you factored in the Earned Media. That alone was worth every penny spent. ?
Founder of America's Best-Selling Falafel Brand, TaDah! Foods | Principal at JSX Ventures | Seasoned Executive Specializing in Innovation, Leadership, Marketing & Strategic Growth
3 个月Ahh, the good 'ol days! My time in AOL's Partner Marketing group was one of the highlights of my career
"You’ve got to go back to 2009 and try to remember – AOL wasn’t dead yet." Brian, we're still here!! Certainly nowhere close to dead and still killing it! Go AOL!
Director of Legal, North America | MBA | Finance | Strategy | Leading a Business-First Legal Department
3 个月Great post. What a memorable example of why it is so important to understand “the goal” of a deal to effectively represent a client/company.
Flowcode Founder & CEO
3 个月Brian - Hope all is well - you nailed it as always. The only other thing that was a huge intangible benefit of that deal was that Warren Buffet and Martha Stewart flew to Dulles and were surprise guests - and spoke to the whole company. The press was the goal for the brand value and customer trust - if Warren Buffet trusted AOL, you could too. But, the thing I remember most was the level of internal belief in AOL that came from Warren flying from Omaha to spend the day at AOL with us - that was magic cherry on top of the press sundae. Great memory - Go AOL - TA
So very true. What good leaders need to do though is provide context in clear communications to keep the team on the right page and focused.