My first newsletter focused on life and business lessons learned from early golf in the small Iowa town where I grew up.

In this newsletter, I'm changing direction - focusing on the overlap between law and business from a practical 'real world' perspective; at least my experiences, and five lessons I learned in moving from a lawyer to a business deal maker.

So here goes…

Lesson One: Don’t sound like a lawyer.

I had a few really important mentors at Cornell. My favorite was Professor Gray Thoron. Gray served as the Dean of Cornell Law School in the 1960’s. He continued at Cornell into the 1980’s with intermittent posts as U.S. Assistant Solicitor General arguing cases before the U.S. Supreme Court. Gray was both a humble and amusing gentleman despite his illustrious accomplishments.

After graduating from Harvard Law School in 1941, he joined Wall Street law firm Sullivan & Cromwell (S&C). He was only at S&C for a few months before the bombing of Pearl Harbor. He was only one of two lawyers at the large firm to enlist the next day. He served for the duration of the war as a combat infantryman in an armored brigade later becoming Company Commander.

He was seriously wounded leading an assault on the Siegfried Line, for which he received a Purple Heart, and was also awarded both the Bronze and Silver Stars. Gray mentioned to his students his proud service in the war, but not once did he ever mention his awards.That’s the kind of individual he was. I joined Sullivan & Cromwell because of Gray.

When I was at Cornell in the mid-1980s, Gray was nearing the end of his tenure and taught a third year class in Legal Ethics. This was no boring Ethics class; instead, Gray brought in Cornell Law alums to tell us about their experiences and challenges practicing law.

I still remember many of the guest speakers, from an attorney who described himself as a “certified workaholic” who worked at a large Wall Street law firm until he had a nervous breakdown and changed his career path, to high-powered criminal defense attorneys, famous U.S. prosecutors, to lawyers who represented indigent clients.

Gray had wonderful lessons that I will always remember.

One lesson in particular:

Gray explained that the best compliment a lawyer can receive, is if you’re at a cocktail party and someone you talk to finds out you’re a lawyer, and says ‘that’s surprising, you don’t sound like a lawyer!’

Gray’s point was, ‘be a good lawyer, but more importantly be interesting, don’t dwell on your profession.’

In fact, besides being boring, there are plenty of other reasons for a lawyer not to sound like a lawyer at cocktail parties!

I carried this lesson through my career, business and life. Especially for me, as a lawyer who never wanted to be ‘just a lawyer,’ this lesson was vital.

Professor Gray Thoron (left), Cornell Law School

When it comes to business deals or business generally, let’s face it— people typically do not like lawyers.

Lawyers are often perceived as ‘deal killers,’ ‘nit pickers,’ ‘problem makers,’ and worse descriptions that I will not mention!

I’ve seen this many times over my career: so-called ‘business people’ might try to avoid lawyers, even intentionally keeping lawyers out of the negotiation process. This is usually a recipe for disaster for any business deal.

Lawyers can overcome this perception, of course, by being a 'deal doer,” focusing on what’s important - not the ‘nit picks,’ be a ‘problem solver,” and above all, be a “closer.” However, the first step is to heed Gray’s advice: ‘Don’t talk like a lawyer!”

Lesson Two: Make yourself indispensable— don’t take a ‘back seat’ as just the lawyer; jump into the 'front seat!’

After my stint with Sullivan & Cromwell, I joined First Data Corporation (FDC, now Fiserv). Back in 1993 when I joined, First Data was a recently spun out $3B revenue subsidiary of American Express. During my 6 years at First Data, it became a $40B revenue company, largely through acquisitions and other transactions. I started at First Data in its legal department as M&A counsel.

What made me decide on First Data versus other opportunities I had at companies like General Electric and other large bureaucratic companies, First Data had just gone public and had a very aggressive culture. (I would later characterize it as a ‘Wild West cowboy’ culture - but that’s a whole different story!).

The new General Counsel, David Bailis, was building a law department from scratch - and although I only spent a year in First Data’s legal department before moving on to business development and operations positions, David continued to be a great mentor and friend.

Another attractive aspect of First Data was that it was in several industries that were quickly consolidating— credit cards, checks, data processing, credit reporting; and FDC was the natural strategic consolidator of each of these industries. This meant that there would be tons of deals— and there were.

Although my S&C experience was very good (largely because I was stationed both in the U.S. as well as London and Melbourne Australia - so I was exposed to a wide variety of U.S. and international transactions), my First Data days were ‘baptism by fire’ at a new level.

Most of my FDC business colleagues that ran the deals were senior level sellers, but lacked any significant deal skills. So it didn’t take long for me to tell First Data senior management that I should run the entire transaction, both legal and business. I became ‘indispensable’ to an important component of FDC’s strategy: getting deals done properly and quickly. So after a year in the legal department, I moved to business development positions and jumped into the ‘front seat” of the deals.

Later on, First Data Merchant Services, a major division composed of several bank joint ventures that I structured and negotiated, started missing its numbers. As a result, the operations leadership was terminated, and FDC’s CEO appointed me and two other executives to run the operations, which is what I did for my last 3 years at FDC.

So the lesson I learned here:

If you want to be more than a lawyer, you first have to make yourself indispensable, and second, when ready, jump into the front seat and take charge!

One more thing— when you jump in the 'front seat', it’s good to ‘buckle up’— the road can get a little bumpy!

Lesson Three: Focus on what’s important and don’t waste time on what’s not.

If there is one lesson that I’ve learned in 35 years of deals, it’s ‘you can’t get lost in the weeds.’

In all transactions and business projects, there will always be a multitude of items that need to be addressed. However, there are typically only a handful of ‘issues’ that are what I refer to as ‘deal-breakers.’

The multitude of smaller items need to be addressed in some fashion; but at the end of the day, probably will not matter as long as the deal breaker issues are properly addressed and resolved.

Now, in a $10B+ deal, the ‘deal-breaker’ issues are much bigger than a $100M deal. The deal-breaker issues usually revolve around economics and significant liability; sometimes they fall outside these two categories.

But the lesson still holds: focus on what’s important; don’t waste time on what’s not.

This lesson arises in a variety of situations. One of the most common is the ‘deal issues’ list.

In any transaction whether big or small, it’s always essential to construct a ‘deal issues’ list. It helps you focus on the issues, develop a game plan for resolving the issues, and manage the resolution process. Typically, lawyers are tasked with putting these lists together. I’ve forgotten the number of times I’ve asked for an issues list and what comes back is a list of 100+ ‘items’ with no emphasis placed on what 5 ‘deal issues’ really matter.

Let me give an example:

Most of my deal experience arises from media and technology transactions. There are always 10 to 100+ outstanding items relating to intellectual property (IP). However, these 100+ IP items typically revolve around 1 or 2 key issues: who owns what? Who takes the risk if something goes wrong? In other words, whittle the 100+ IP ‘items’ down to 2 key IP ‘issues.’ A lawyer who wants to transcend to a deal-maker is uniquely qualified to do this since he or she understands these items.

Let me give one more example: long laborious memos and emails. Who wants to receive, let alone read and try to decipher these memos and emails?

Lawyers are well known for writing long-winded notes on subjects that usually can be boiled down to two or three concise bullet points.

This brings to mind one of my favorite quotes from Mark Twain:

I didn’t have time to write a short letter, so I wrote a long one instead.

Also think like Ernest Hemingway:

All you have to do is write one true sentence. Write the truest sentence that you know.

In deals and more generally in business, I’ve learned that if you want to be effective, you need to be concise and focus specifically on what really matters. Take the time to organize your thoughts, ask yourself what you want the reader to focus on, and then edit like Twain or Hemingway.

Hemingway also said ‘Write drunk, edit sober,’ but let’s save this one for a later newsletter!

Lesson Four: Sometimes ‘complex’ is good; most times it is bad.

Like most things in life, simpler is better. I’ve always tried to tell myself to ‘Keep it simple stupid!’ The same is true for deals. If deals are overly complex or depend on too many variables, they are very likely to fail.

There are some exceptions to this rule - in particular where complexity is necessary to achieve business objectives, accomplish tax and regulatory goals, and maximize shareholder value.

A recent example: the two final and simultaneous transactions (we codenamed them ‘Matrix’ and ‘Match’) at Meredith Corporation, both closing on December 1, 2021. These transactions were the culmination of three years of work, highly complicated regulatory hurdles and hundreds of project work streams that needed to come to a timely and successful conclusion. Our success was largely due to a great and highly skilled internal and external team all working together.

Kevin Mills, our lead deal lawyer at Cooley LLP, who along with his colleague Aaron Binstock are some of the best deal lawyers I’ve ever worked with, remarked to us after the closings that pulling off these two transactions was equivalent ‘to making an uphill 90 foot putt over gravel!’ (Kevin is also an avid golfer.)

*My golf analogy was more like Bubba Watson’s miraculous wedge to win sudden death in the 2012 Masters.*

We may never see another shot like Bubba’s. There will continue to be highly complex deals that close— but in my experience, most of them will likely fail. Just say’in…

Lesson Five: Be proactive; get out there!

When I first joined Meredith Corporation, I joined as General Counsel. At that time, Meredith was not even close to a transaction-oriented company. In fact, I think the company might have done only a couple acquisitions in the years before I arrived. The largest deal happened to be right after I accepted Meredith’s offer— this was the purchase of Atlanta’s CBS affiliate.

When the deal was publicly announced— with the excessive purchase price that Meredith agreed to pay, MDP stock tanked because it was so dilutive to earnings-per-share (EPS). I remember sitting at my home in Atlanta (I then worked at First Data’s Atlanta headquarters) wondering what in the world did I get myself into!

Now this was the early days of the Internet (think ‘Y2K’ and AOL ‘You’ve got mail!’). It was before broadcast stations had content fees or political advertising. Magazines actually were a fairly good business, but there were major consumer shifts coming around the corner. That being said, it was clear to me that Meredith was special— we had great editorial professionals, hardworking smart business operations, strong consumer marketing talent, and we had some pretty good brands— Better Homes & Gardens being our ‘flagship.’

But it also became clear that we needed transactions— specifically smart acquisitions and licensing partnerships - to start growing revenue.

When I first started the Corporate Development function in the mid-2000’s, Meredith was known as a conservative well-managed Midwestern family business (it turns out, Meredith’s content and operating platform in Des Moines was our ‘secret sauce’ as we competed back then with New York publishing companies). But from a Development (i.e. bringing in deals) standpoint, we needed to be proactive and get the word out.

So the first thing we did was meet with every investment bank that mattered, every private equity firm, every potential target business. We also went on the speaking circuit both in the U.S. and internationally. Before too long, we were getting more ‘in bound’ calls than we wanted to act on, and then we started getting deals transacted and started accomplishing our business objective: acquiring and growing profitable revenue, adding more brands and enhancing our digital capabilities.

We had a great ten or so year stretch of accretive (positive earnings per share) acquisitions— integrating magazine and digital businesses along with television stations, and very significant licensing partnerships.

Then we bought Time Inc. in 2017 for $2.8B. A key component of our acquisition model was being able to divest businesses that would be better suited for other parties. Our Development priority quickly changed from a 'buy' business to a 'sell' business. In fact we sold 15 businesses (from iconic brands, to digital assets, to the largest publishing house in the UK) in 24 months— all at good purchase prices; but more importantly, we found good 'homes' for these businesses - Marc and Lynn Benioff for Time, CJ for Fortune, Authentic Brands Group for Sports Illustrated, among others.

We could not have accomplished this success without the foundation we had built through our proactive work in building a world class business development network.

*Signing the closing agreements in Hong Kong with billionaire* *Chat Jiaravanon (CJ)* *(second from right) on the sale of Fortune, also with longtime colleague* *David Johnson (DJ)* *(second from left) and* *Alan Murray, CEO of Fortune* *(third from left).*

So lesson learned here:

Lawyers moving to deal-makers need to be proactive; make your name known - meet with everyone who matters, and get on the best speaker circuits to accomplish your objectives.

Well there you have it - my five lessons learned.

Just say'in and see you next time!

-JZ

Five Lessons Learned on How Lawyers Become Business Dealmakers