Billionaire Mark Cuban swears by this ‘powerful’ negotiation hack: It’s ‘money in the bank’
Mark Cuban often sits quietly while his “Shark Tank” co-hosts are in a bidding war — and it isn’t a coincidence.
The billionaire investor learned how to use silence to his advantage, he said in a recent discussion with best-selling author Chris Voss on Fireside, the streaming audio app Cuban co-founded. Instead of being first to grill the entrepreneurs, Cuban prefers to “just be quiet and listen,” he added.
It’s a negotiating tactic — one that allows him to gather necessary information and gives him time to size up his competition.
“[Silence] gives you a chance to learn. There will be times when someone walks in on ‘Shark Tank’ and I’m thinking to myself: ‘There’s no way I’m interested. Or, if I am, I don’t have quite all the data that I need to make a decision,'” he said. “When I listen to the other sharks, they’re going to tell me if I have any competition financially to do a deal. They’re going to teach me things, potentially, about that industry… about the person.”
Cuban mentioned his fellow shark, real estate mogul Barbara Corcoran, as someone he often learns from on the show, simply by listening.
“Barbara Corcoran, who sits next to me very often… her people skills dwarf mine,” he added. “She is so good at sizing up people and understanding who they are… I want to get a sense of what her perspective is. And just getting that input makes me smarter.”
The Cost Plus Drugs founder might also get a kick out of others’ reactions to his quietness, as he notes how they “always freak out.”
“People freak out with silence,” he said. “So when the entrepreneurs are there and I’m not saying anything, what happens is, they all start looking to me because they’ve heard from everyone else and they haven’t heard from me.”
“[They ask] ‘Mark, you got anything for me?,’ … I’m just waiting or I’m just listening. Because it gets all the other sharks wondering what I’m doing,” Cuban continued. “They know I’m not afraid to pull the trigger on a deal. And it gets the entrepreneur wondering what I’m doing because he wants to know if I’m going to bid or if I’ll pay more or what else I may be able to add.”
Cuban’s negotiation trick is actually backed by science — a few moments of silence in a negotiation can give both parties time to reflect and result in better outcomes all around, according to a 2021 study by the MIT Sloan School of Management.
However, the hack only works if you practice active listening and observing, Cuban said.
“The more you pay attention and the more aware you are, the better opportunity you have to get what you want,” he said.
“Silence is powerful,” he added. “Silence is money … money in the bank.”
Disclosure: CNBC owns the exclusive off-network cable rights to “Shark Tank,” which features Mark Cuban as a panelist.
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