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What I Learned Negotiating With Steve Jobs

Fresh out of Stanford Business School, I started a software company, T/Maker, with my brother Peter. He was the software architect and I was, well, everything else. Our little company was among the first to ship software for the Macintosh, and we developed a positive reputation among the members of the nascent developer community, which led us to expanding our business by publishing software for other independent developers. Two of our developers, Randy Adams and William Parkhurst, went to work for Steve Jobs at his new company, NeXT, and that’s how I ended up head to head with Steve Jobs.

Turns out, Steve had a problem and Randy and William thought I could be the solution. Steve had done an “acquihire” of the developers who had written the Mac word processor MacAuthor. In order to make the deal economics work, Steve had promised to publish MacAuthor and pay royalties to the developers. But now, with the world’s attention on his new startup, how would it look to have NeXT’s first product be a word processor for the Mac? Randy and William suggested to Steve that if I were to be the publisher, the problem would be solved. Steve liked the idea, and invited me in to talk about it.

My first meeting with Steve lasted well over an hour. He grilled me about packaging, channels, distribution, product positioning and the like. I must have passed the test, as he invited me back to negotiate a publishing deal. I spent the next three weeks preparing detailed timelines, package mockups and drafting a very specific contract based on our experience with the other developers we had already published.

On the appointed day, after waiting in the lobby for 45 minutes (this, I would come to learn, was par for the course for meetings with Steve), I was called up to Steve’s cubicle. I remember to this day how completely nervous I felt. But I had my contract in hand and I knew my numbers cold.

Shortly into my pitch, Steve took the contract from me and scanned down to the key term, the royalty rate. I had pitched 15%, our standard. Steve pointed at it and said,

Andrew Carnegie: Replace "What must I do?" with "What can I do?"

On SEBASTIAN MARSHALL

Another couple good insights here from "THE ROAD TO BUSINESS SUCCESS: A TALK TO YOUNG MEN," some in the third paragraph are very quotable --

"...the question now is how to rise from the subordinate position we have imagined you in, through the successive grades to the position for which you are, in my opinion, and, I trust, in your own, evidently intended. I can give you the secret. It lies mainly in this. Instead of the question, "What must I do for my employer?" substitute "What can I do?" [Sebastian note: substitute "customers" or "clients" if you're running a business or self-employed] Faithful and conscientious discharge of the duties assigned you is all very well, but the verdict in such cases generally is that you perform your present duties so well that you had better continue performing them. Now, young gentlemen, this will not do. It will not do for the coming partners. There must be something beyond this. We make Clerks, Bookkeepers, Treasurers, Bank Tellers of this class, and there they remain to the end of the chapter. The rising man must do something exceptional, and beyond the range of his special department. HE MUST ATTRACT ATTENTION. A shipping clerk, he may do so by discovering in an invoice an error with which he has nothing to do, and which has escaped the attention of the proper party. If a weighing clerk, he may save for the firm by doubting the adjustment of the scales and having them corrected, even if this be the province of the master mechanic. If a messenger boy, even he can lay the seed of promotion by going beyond the letter of his instructions in order to secure the desired reply. There is no service so low and simple, neither any so high, in which the young man of ability and willing disposition cannot readily and almost daily prove himself capable of greater trust and usefulness, and, what is equally important, show his invincible determination to rise.

Some day, in your own department, you will be directed to do or say something which you know will prove disadvantageous to the interest of the firm. Here is your chance. Stand up like a man and say so. Say it boldly, and give your reasons, and thus prove to your employer that, while his thoughts have been engaged upon other matters, you have been studying during hours when perhaps he thought you asleep, how to advance his interests. You may be right or you may be wrong, but in either case you have gained the first condition of success. You have attracted attention. Your employer has found that he has not a mere hireling in his service, but a man; not one who is content to give so many hours of work for so many dollars in return, but one who devotes his spare hours and constant thoughts to the business. Such an employee must perforce be thought of, and thought of kindly and well. It will not be long before his advice is asked in his special branch, and if the advice given be sound, it will soon be asked and taken upon questions of broader bearing. This means partnership; if not with present employers then with others. Your foot, in such a case, is upon the ladder; the amount of climbing done depends entirely upon yourself.

One false axiom you will often hear, which I wish to guard you against: "Obey orders if you break owners." Don't you do it. This is no rule for you to follow. Always break orders to save owners. There never was a great character who did not sometimes smash the routine regulations and make new ones for himself. The rule is only suitable for such as have no aspirations, and you have not forgotten that you are destined to be owners and to make orders and break orders. Do not hesitate to do it whenever you are sure the interests of your employer will be thereby promoted and when you are so sure of the result that you are willing to take the responsibility. You will never be a partner unless you know the business of your department far better than the owners possibly can. When called to account for your independent action, show him the result of your genius, and tell him that you knew that it would be so; show him how mistaken the orders were. Boss your boss just as soon as you can; try it on early. There is nothing he will like so well if he is the right kind of boss; if he is not, he is not the man for you to remain with--leave him whenever you can, even at a present sacrifice, and find one capable of discerning genius. Our young partners in the Carnegie firm have won their spurs by showing that we did not know half as well what was wanted as they did. Some of them have acted upon occasion with me as if they owned the firm and I was but some airy New Yorker presuming to advise upon what I knew very little about. Well, they are not interfered with much now. They were the true bosses--the very men we were looking for."

The whole piece is worth reading and takes 5-10 minutes to read. 

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