Million Dollar Partnership Refund

Shaan tells a story about returning $1 million during an acquisition negotiation after realizing it wasn't the right fit.

"We went down the path with this high offer and there was a time to close. One of the stupid things they did - they wrote the offer where when we signed the term sheet (which is not when the deal is closed), they had to wire us all the money on day one.

During that closing period, we started to get a little sketched out. There were red flags - they had a lawyer that would jump on calls but refused to ever turn his camera on, had no LinkedIn, and sent us documents that our lawyer said 'there's no way a lawyer wrote this.'

We said 'Look, I don't think this is the right deal for us, maybe we should just go back to option 1 - we'll just keep running our company.' So we wired back a million dollars voluntarily because we had made the mistake of going with the highest offer first rather than the best offer.

The best offer is a combination of: it's likely to close, the people involved are high quality, and they're people you want to be around. The business world is actually kind of small - you run into people, they now own your company and your brand. You don't want it in the wrong hands. You'd rather do business with great people who you might do more business with in the future, which is what we ended up doing."