Dealcraft: Insights from Great Negotiators

Steve Schwarzman II: Hardball

9 snips
Oct 7, 2024
Steve Schwarzman, Co-founder and CEO of Blackstone, shares his hardball negotiation insights from his illustrious career. He discusses navigating tough negotiations, including a railroad acquisition where psychological strategies played a key role. Schwarzman reflects on high-stakes situations like the economic turmoil post-Iraq and Blackstone's investment challenges. He emphasizes adapting tactics, understanding dynamics, and asserting authority to achieve successful outcomes. The conversation reveals the delicate balance between strategy and relationship-building in high-pressure deals.
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ANECDOTE

Schwarzman vs. Simmons

  • Steve Schwarzman, hired by CSX's CEO, negotiated with Harold Simmons, who was blocking a valuable acquisition.
  • Schwarzman devised a plan to make Simmons's position untenable unless he sold his shares.
ADVICE

Carrots and Sticks

  • If offering a value-creating deal fails, consider crafting costly consequences for counterparts who refuse.
  • Make the "carrots" tastier and the "sticks" sharper in negotiations.
ANECDOTE

Blackstone's Ramada Crisis

  • Blackstone faced potential ruin when New World Development threatened to withdraw Ramada's franchising license.
  • Steve Schwarzman and Henry Silverman negotiated with Henry Cheng in Hong Kong to retain the license.
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