Negotiation Skills for Entrepreneurs: Questions, Listening, and Uncovering Interests

Why “positions” hide the real deal

In entrepreneurial negotiations, people rarely argue about what they truly care about. They argue about a position (a stated demand): “$50k,” “deliver in 2 weeks,” “no indemnity,” “net-60.” Underneath sits an interest (the need or constraint driving the position): cash flow, certainty, risk reduction, internal approval, reputation, workload, timing, or control.

Your job in this chapter is to get good at discovering interests without interrogating or triggering defensiveness. You do that with three tools that work together: (1) question types that invite detail, (2) active listening that makes it safe to reveal constraints, and (3) summaries/labels that confirm you understood and keep the conversation moving.

Common entrepreneur-relevant interests to listen for

• Timing: launch dates, seasonal demand, board meetings, renewal windows, procurement cycles.
• Certainty: predictable delivery, guaranteed capacity, service levels, “no surprises.”
• Cash flow: payment terms, milestones, deposits, financing, burn rate.
• Risk reduction: liability, compliance, security, performance risk, reputational risk.
• Effort reduction: fewer meetings, less vendor management, simpler implementation.
• Status/control: decision rights, escalation paths, reporting, visibility.

Question types that uncover interests (without sounding pushy)

Use questions in a sequence: start broad to map the terrain, then go diagnostic to find constraints, then use calibration questions to test tradeoffs and create options.

1) Open questions (map the landscape)

Open questions invite narrative and context. They are especially useful early, or when you sense the other side is stuck in short, positional statements.

• “Can you walk me through what success looks like for you?”
• “What’s driving the timeline on your side?”
• “How are you evaluating options?”
• “What would make this easy to approve internally?”
• “What are the non-negotiables vs. the nice-to-haves?”

Step-by-step: Ask one open question, then pause. Let silence do work. If they answer with a position, follow with a diagnostic question rather than another open question.

Continue in our app.

• Listen to the audio with the screen off.
• Earn a certificate upon completion.
• Over 5000 courses for you to explore!

Or continue reading below...

Download the app

2) Diagnostic questions (find constraints and decision mechanics)

Diagnostic questions narrow in on the “why,” the process, and the constraints. They help you separate a true constraint from a preference.

• Constraint: “What prevents you from moving forward at that price?”
• Decision process: “Who else needs to be comfortable with this?”
• Criteria: “What are the top three factors you’re optimizing for?”
• Risk: “What’s the worst-case scenario you’re trying to avoid?”
• Timing: “What happens if this slips by two weeks?”

Tip: Ask about consequences. Consequences reveal the real interest (e.g., “If we miss the date, we lose a partner slot” → timing and certainty matter more than speed alone).

3) Calibration questions (test tradeoffs and create options)

Calibration questions are designed to open problem-solving while keeping you out of “yes/no” traps. They often start with “How” or “What.”

• “How can we meet your deadline while keeping quality stable?”
• “What would you need to see to feel comfortable with a 12-month term?”
• “If we could reduce risk here, what flexibility would that create on price?”
• “What’s the best way to structure this so finance is comfortable?”
• “How do you want to handle change requests so neither side gets surprised?”

Practical pattern: If we can X (their interest), would you be open to Y (your ask)? Keep X specific and measurable (e.g., “a 99.9% uptime SLA” or “a fixed delivery milestone”).

Active listening techniques that make people reveal more

People share interests when they feel understood and not judged. Active listening is not “being nice”; it’s a method to gather accurate data and reduce resistance.

Technique 1: The 70/30 rule

Aim to listen ~70% of the time. If you’re doing most of the talking, you’re guessing at their interests instead of discovering them.

Technique 2: Minimal encouragers and silence

Use short prompts that keep them talking without steering.

• “Say more.”
• “Go on.”
• “I’m listening.”
• (Silence + attentive posture)

Technique 3: Mirroring (repeat the last 1–3 key words)

Mirroring encourages elaboration and often reveals hidden constraints.

Example:

Client: “We can’t do annual upfront.”
You: “Annual upfront?”
Client: “Yeah, finance is freezing discretionary spend until Q3, but we can do monthly if it’s cancellable.”

Technique 4: Paraphrase for meaning (not for words)

Paraphrase what you think they mean, especially around priorities and constraints.

Example: “It sounds like the main issue isn’t the total cost; it’s the timing of cash leaving the business. Is that right?”

Technique 5: Track and name decision points

Entrepreneurial deals stall because nobody clarifies the internal path to “yes.” Listen for and capture:

• Decision-maker(s)
• Approval sequence (legal → security → finance → exec)
• Deadlines for each step
• What “good enough” looks like for each function

Then reflect it back: “So next step is security review this week, then legal redlines, and you want to sign by the 28th to hit implementation. Did I capture that?”

Summarizing and labeling emotions (without sounding like therapy)

Emotions in business negotiations are often about risk, accountability, and fear of being blamed. Labeling and summarizing reduce tension and increase clarity.

Labeling: name the emotion or pressure you observe

Use tentative language so it doesn’t feel accusatory:

• “It sounds like you’re under a lot of pressure to hit that date.”
• “It seems like legal is worried about open-ended liability.”
• “It sounds like you’ve been burned by vendors missing deadlines before.”
• “It seems like you need certainty more than the lowest price.”

Why it works: When someone feels seen, they correct you or confirm you. Either way, you get better data.

Summarizing: compress the story into a shared map

A good summary includes: their goals, constraints, risks, and what they’ve said matters most. End with a confirmation question.

Template:

Let me make sure I’ve got this right: you’re trying to [goal], by [date], and the biggest concerns are [risk/constraint 1] and [risk/constraint 2]. If we can address those, the remaining question is [open issue]. Did I miss anything important?

Practical note: Summaries are especially useful after an objection. They turn “pushback” into a problem statement you can solve.

Confirming understanding: prevent costly misalignment

Misunderstanding is expensive: it creates rework, delays, and resentment. Confirming understanding is a repeatable micro-process.

A 4-step confirmation loop

• 1) Reflect: “What I’m hearing is…”
• 2) Test: “Is that accurate?”
• 3) Calibrate: “What’s the most important part of that for you?”
• 4) Align next step: “What’s the best next step to move this forward?”

Example (vendor negotiation):

Vendor: “We can’t commit to that SLA.”
You: “What I’m hearing is you’re concerned about being on the hook for outages you can’t control. Is that accurate?”
Vendor: “Exactly—especially third-party dependencies.”
You: “What part is most sensitive—credits, uptime target, or measurement method?”
Vendor: “Measurement method.”
You: “Okay. What if we adjust measurement to exclude scheduled maintenance and third-party downtime, but keep the uptime target?”

Putting it together: a practical conversation flow

Use this flow when you feel stuck, when objections appear, or when the other side is vague.

Step-by-step flow (7 moves)

1. Open: “Can you share what matters most in this decision?”
2. Diagnose: “What’s driving that?” / “What happens if it’s not met?”
3. Label: “It sounds like certainty is the big concern.”
4. Mirror + pause: Repeat key words, then silence.
5. Summarize: “Let me make sure I’ve got it…”
6. Calibrate tradeoffs: “If we solve X, what flexibility do we have on Y?”
7. Confirm next step: “What do you need from me to get this approved?”

Guided exercise: convert objections into interests and solution paths

This exercise trains you to hear objections as signals. You will translate each objection into (1) likely underlying interests, (2) diagnostic questions to confirm, and (3) solution paths that trade across variables (timing, certainty, cash flow, risk reduction).

How to do the exercise (repeatable method)

1. Write the objection verbatim. Don’t soften it.
2. List 3–5 possible underlying interests. Assume the first guess is incomplete.
3. Pick 2 diagnostic questions that would confirm which interest is real.
4. Generate 2–4 solution paths that address the interest without automatically conceding your core terms.
5. Draft a 2-sentence response using: label → question.

Objection 1: “It’s too expensive.”

2-sentence response practice: “It sounds like the concern is whether the value justifies the spend. Is it the total amount, or the timing of the payments that’s hardest?”

Objection 2: “We need it faster.”

2-sentence response practice: “It sounds like there’s real pressure behind the timeline. What’s driving the deadline, and which deliverable absolutely must be done by that date?”

Objection 3: “Legal won’t allow that.”

2-sentence response practice: “It sounds like legal is trying to reduce a specific risk exposure. Which clause is the concern, and what outcome does legal need to feel protected?”

Extra practice: turn your own real objections into an “interest map”

Pick one objection you hear often (from clients, vendors, or partners). Fill this in:

• Objection (verbatim): ________
• Possible interests (at least 4): ________
• Two diagnostic questions: 1) ________ 2) ________
• Two labels you could use: 1) “It sounds like…” ________ 2) “It seems like…” ________
• Three solution paths (trade across variables): ________
• Confirmation summary (1–2 sentences): ________

Common pitfalls (and how to correct them in the moment)

Pitfall: asking “Why?” and triggering defensiveness

Swap to: “What’s driving that?” or “Help me understand the constraint.”

Pitfall: solving too early

If you propose solutions before confirming the interest, you may solve the wrong problem.

Correction: Ask one diagnostic question, then summarize: “So the main issue is X, not Y—right?”

Pitfall: treating an objection as a stop sign

Objections are often invitations to discuss constraints.

Correction: Label + calibrate: “It sounds like this feels risky. What would make it feel safe enough to proceed?”

Pitfall: confusing “understanding” with “agreement”

You can understand their interest and still hold your boundary.

Correction language: “I understand the concern about cash flow. Given that, let’s look at structures that reduce upfront spend while keeping the total investment the same.”