Hi friends,

This week on Gentle Power (YouTube | Spotify | Apple), we sat down with Kenko Ueyama, cofounder of Tsubasa AI, an AI advisory agency that helps enterprise companies figure out their AI strategy and then helps them build it. Kenko is also a senior advisor at Harvard’s Applied AI Institute, helping create AI course material and run workshops that trains executives on how to lead companies in the age of AI.

Our conversation spanned Kenko’s long career, from his early days working at Mitsubishi Corporation in Japan to the AI consulting he does today, and touched on the negotiation lessons he learned throughout.

Listen to the full conversation here (YouTube | Spotify | Apple), and see below for a few of the standout takeaways.

1. Your pricing signals your value

Kenko shared a lesson most founders learn the hard way: early on in his business, he priced a consulting project at about half of what he thought it should have been.

The obvious downside is on your end: you’re doing hard work while quietly thinking, why did we agree to this?

The less obvious downside is on the client’s end. When the project is cheap, it becomes a low priority for them. It gets less attention and resources, slower decisions, and less momentum. In other words, underpricing can undermine the work for both parties and leave all stakeholders feeling worse off about the engagement.

This matches something we see all the time in our work helping negotiate business deals. Your price signals perceived value, and perceived value changes behavior. People staff projects and prioritize based on how much they think the work matters.

This also reminded Alex of a case study about the eyewear company, Warby Parker, when he was studying at Wharton Business School. When the Warby Parker founders were just starting their company while they were Wharton MBA students and showed their business plan to their professor, the professor said everything looked sound except one thing: their eyeglasses were too cheap. “You’ve priced them at $45. As a consumer, it’s hard to believe that truly high-quality eyeglasses would only cost $45. Double your price.” So the founders priced their glasses at $90 and their sales skyrocketed.

It’s not the only contributing factor to scoring a deal, but your price plays a big role in communicating the quality of your product and work. Price yourself too cheaply, and people may perceive your work as cheap.

2. Find your resentment number

We touched on a really important concept during our conversation: your “resentment number.” We first heard about this concept from Simone Grace Soel, host of the “I Am Your Korean Mom” business podcast.

The resentment number is the number at which if you’re paid any less than that, you’ll start feeling resentment and contempt for the work and effort you’re putting in.

It’s the lowest price where you can still show up generously, even when the work gets messy, the client becomes tougher to work with, or the scope gets annoying. If you price below that number, resentment will creep in.

Your resentment number is a useful internal check because market rates can be fuzzy, especially in emerging spaces. Even when you have data, you still have to live inside the deal you made.

3. Some cultures negotiate before the negotiation

Kenko shared with us a Japanese concept called “nemawashi”, which roughly translates to “spreading the roots”. The idea is simple: you do all the alignment before the meeting, one conversation at a time, with each of the stakeholders. Then the actual meeting is mostly a formality where you confirm what’s already been agreed to.

This concept has parallels to what we often recommend. You almost never want to conduct negotiations live over a call. Instead, negotiate in writing over email before and after calls so that you can present your case after having put time and thought into what you want to say. This also gives the opportunity for your emails to be additional representation of your candidacy, as emails are often forwarded amongst recruiters and hiring teams.

Listen to our full conversation with Kenko, where we covered more concepts and fun negotiations stories from Kenko’s career: YouTube | Spotify | Apple​

To learn more about Kenko and his work, connect with him on LinkedIn here, or visit his website: tsubasa-ai.com​

Talk soon,

Gerta & Alex
​Co-founders, YourNegotiations.com

P.S. Are you job searching or have upcoming negotiations?

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