Stanford Technology Ventures Program; Arbor Advisors
Stan Christensen is a partner at Arbor Advisors, an investment banking firm where he negotiates on behalf of mid-market technology companies. He has nearly twenty years of experience in both transactional and operations roles and has worked on hundreds of transactions. Before starting Arbor, he was the General Manager of Eazel, a Linux-based software startup. He started his career in corporate finance on Wall Street, and then worked for ten years with CMG, a negotiation advisory firm affiliated with The Harvard Negotiation Project. In this capacity he worked with corporations and governments-advising, negotiating, and mediating transactions and conflicts. In 1996 he was selected as a Kellogg Fellow for his work in the non-profit and public sectors. He is a member of The Council On Foreign Relations and currently teaches a course on Negotiation at Stanford University in The School of Engineering.
He holds an M.B.A. from Harvard Business School and a B.A. from Brigham Young University.
Related Links: stvp.stanford.edu arboradvisors.com/
Last Updated: Mon, Oct 30, 2006
Dan Springer, CEO of Responsys, offers advice on how to raise venture money. Springer suggests that raising money depends on three factors: 1) What you have to offer, 2) The state of the venture market, and 3) An entrepreneurs long term goals. Springer argues that it is challenging for an entrepreneur with little experience or just an idea, as opposed to a business, to raise money and advises that entrepreneurs might be well served to raise money when they have a stronger value proposition. In addition, Springer also recognizes that the state of the venture market also affects the ability of an entrepreneur to raise capital. Finally, Springer proposes that entrepreneurs consider the value of the long term relationship with venture investors when bargaining on venture deals and highlights the benefits of leaving enough room in a venture deal to ensure investors get a good return.
The industry norm is for attorneys not to take equity or a board seat as forms of compensation from startups, says attorney Martin Nichols. In Silicon Valley, fee deferrals are far more normal. Big legal firms may be less likely to work with small startups due to time and revenue constraints, but a smaller firm may not be able to provide a startup with everything that is needed when it comes time for big transactions, such as mergers and acquisitions.
Young talks about how he used negotiation skills to earn his place in the San Francisco 49ers. He describes how he never showed any signs of victimization and played his best on the field. Never give an excuse, he says, and always take the blame where it is appropriate. 
Stan Christensen, Stanford instructor and a partner at Arbor Advisors, outlines a few of the erroneous career assumptions that land workers in an ill-fitting career. Don't take a job simply to build your resume; follow your passions, rather than guessing what an employer will want. The fun should outweigh the drudgery - even in entry-level positions. Don't feel that by taking one job, you're committing to a career; people switch teams often. And remain a generalist, rather than specializing in a single pursuit, as this will retain your flexibility and keep your skills from becoming irrelevant. 
Young cautions against using a sword and whip with negotiations. He believes that this type of negotiation tactic has diminishing returns. Instead, he strongly advises that entrepreneurs not lose their values for the sake of winning a deal. 
An overbearing career is unhealthy, says Stan Christensen, Arbor Advisors Partner. Rather than working long hours, Christensen relays a successful negotiation with his manager explaining his interests outside of work. He asked to be judged by the tasks he completed, and not by the amount of hours he was in the workplace. He recalls that the results were fewer long evenings and weekends at his desk, earning him respect and the time needed for his own pursuits.
Young describes his career path from quarterback to lawyer to entrepreneur. He explains how he worked to acquire relationships with venture capitalists through their interest in football. When he retired from football, he created a funds-to-funds business in the venture capital industry with his teammates and later on, his own private equity fund. 
Leaving a job is as critical a negotiation as starting one, says Arbor Advisors partner Stan Christensen, and the last impression you make is even more critical than the first. Christensen offers two examples of employees who have left his firm: One who shared his desire to move on and arranged for a six-month transition plan, and the other who slammed down a same-day letter of resignation. He extols the first case as an example of what to do to facilitate a long-term positive relationship. He also points to the awkwardness of the second scenario, and comments on its dishonesty and the difficulties left in its wake. 
Attorney Martin Nichols shares subjective early filters to use when trying to find a proficient attorney. Beyond these basic measurements, a difference in quality will be found in each attorney's ability to get deals done. Nichols suggests finding an attorney who can also be a solid advisor and a true value-add for your company.
Stan Christensen believes that communication is a key element in negotiation. He stresses the fact that communication is about convincing the other side that you can hear them and that they are being heard. He illustrates it with anecdotes and his personal experiences in negotiating deals.
Dan Springer, CEO of Responsys, talks about the challenges of dealing with problematic employees. Springer suggests that it is easier to deal with clear under-performers whereas the greater challenge is to address team members who have both positive and damaging qualities. Springer suggests that the best response to these situations is to have a clear and frank conversation with the team member which gives them an opportunity to improve.
Young explains how he dealt with the ongoing presence of news reporters throughout his career. He realized that many of these reporters commuted for long hours, only to receive tidbits of information from the 49ers team. By stepping into their shoes, he figured out ways to work effectively together. 
Do as much informational interviewing as you can, advises Arbor Advisors partner Stan Christensen, who, through the practice, learned that law school was not a good fit for his interests. Learning the specifics of a prospective career from a distance is an enriching road map to a career path that might not suit you. And, potentially, it can save time, money, and emotional distress. 
In football, Young notes that most of his negotiations involved getting his team to perform better. In business, however, his negotiations revolve around financial deals and figuring out the unique and individual needs of each person. According to Young, it is important to achieve a comfort level with the other negotiators to understand what their incentives are in the business. 
Men and women do indeed negotiate for compensation differently, says Stan Christensen, Arbor Advisors partner and Stanford instructor. He cites one study where 60 percent of men asked for more money, whereas women with comparable backgrounds asked for more money only ten percent of the time.
Young explains how he was able to negotiate with former 49ers offensive coordinator Bill Wash to play some of his strategies. He would commend Walsh for his ideas and would add a few suggestions. Walsh noticed Young had good ideas and would eventually come to ask for his opinion.
Dan Springer, CEO of Responsys, talks about the potential conflicts of interest between entrepreneurs and investors. Springer advises entrepreneurs to discuss these situations with venture investors in advance of making a deal so that all parties understand the potential outcomes upfront.
Billing is less of an issue, if you build a relationship with legal advisors you trust, says attorney Martin Nichols. Entrepreneurs should share their acceptable fee ranges with attorneys, but they may also be able to work out fee caps and flat rates for services. Clients can help ensure the best service from attorneys by showing mutual respect through offering referrals and paying bills on time.
Attorney Martin Nichols believes clients should receive the best practical advice from an attorney, even when the client is in a legally superior position during a negotiation. Nichols shares an anecdote where he needed to explain to a client the practical value of not fighting for a previously agreed on payment, to avoid being exposed to legal costs of an even greater amount. 
Young talks about how he works to manage relationships not only with his teammates, but with his wife and children. It is about being able to step back and understand what holes in your life exist, he notes. In addition, it is about savoring each moment and seeing the overall picture.