{"product_id":"dealmaking-isbn-9780471250487","title":"Dealmaking","description":"Applying practical tools to the volatile process of negotiating\u003cbr\u003e Prognosticators apply Monte Carlo Analysis (MCA) to determine the likelihood and significance of a complete range of future outcomes; Real Options Analysis (ROA) can then be employed to develop pricing structures, or options, for such outcomes. Richard Razgaitis' Dealmaking shows readers how to apply these powerful valuation tools to a variety of business processes, such as pricing, negotiating, or living with a \"deal,\" be it a technology license, and R\u0026amp;D partnership, or an outright sales agreement. Dealmaking distinguishes itself from other negotiating guides not only by treating negotiations as an increasingly common situation, but also by presenting a tool-based approach that creates flexible, practical valuation models. This forward-thinking guide includes a variety of checklists, case studies, and a CD-ROM with the appropriate software.\u003cbr\u003e Richard Razgaitis (Bloomsbury, NJ) is a Managing Director at InteCap, Inc. He has over twenty-five years of experience working with the development, commercialization, and strategic management of technology, seventeen of which have been spent in the commercialization of intellectual property. \u003cp\u003e\u003cb\u003eChapter 1\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eIntroduction 1\u003c\/p\u003e \u003cp\u003eWhy Another Negotiating Book? 1\u003c\/p\u003e \u003cp\u003eDealmaking™ 3\u003c\/p\u003e \u003cp\u003eHigh Significance, High Ambiguity Contexts 4\u003c\/p\u003e \u003cp\u003eThe “So What?” Question 8\u003c\/p\u003e \u003cp\u003eValuation, Pricing, and Negotiation 8\u003c\/p\u003e \u003cp\u003eTangible and Intangible Content\/Value and the New Economy 9\u003c\/p\u003e \u003cp\u003eThe I Dealmaking Process 10\u003c\/p\u003e \u003cp\u003eOrganization of the Book 13\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 2\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eNegotiation People, Language, and Frameworks 15\u003c\/p\u003e \u003cp\u003eNegotiation People 15\u003c\/p\u003e \u003cp\u003eA Quest 21\u003c\/p\u003e \u003cp\u003eThe Nut, the Number, the Bogie, and the Toe Tag 23\u003c\/p\u003e \u003cp\u003eQuantification, Rationality, and Hyperrationality 24\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 3\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eThe Box and the Wheelbarrow: What Am I Selling (or Buying)? 31\u003c\/p\u003e \u003cp\u003eThe Box 31\u003c\/p\u003e \u003cp\u003eThe Wheelbarrow 36\u003c\/p\u003e \u003cp\u003eDealmaking’s Spine 41\u003c\/p\u003e \u003cp\u003eThe Term Sheet 42\u003c\/p\u003e \u003cp\u003eMethods and Tools 42\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 4\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eDiscounted Cash Flow Analysis and Introduction to Monte Carlo Modeling 45\u003c\/p\u003e \u003cp\u003eDiscounted Cash Flow Analysis 45\u003c\/p\u003e \u003cp\u003eScenario (DCF) Analysis 50\u003c\/p\u003e \u003cp\u003eMonte Carlo Method: An Introduction 64\u003c\/p\u003e \u003cp\u003eClosure and Application to Negotiation 72\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 5\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eMonte Carlo Method 77\u003c\/p\u003e \u003cp\u003eA Model Cash Flow Template 78\u003c\/p\u003e \u003cp\u003eIncome and Cash Flow Statements: 3M Example 79\u003c\/p\u003e \u003cp\u003eMonte Carlo Assumption Tools 91\u003c\/p\u003e \u003cp\u003eUniform Distribution: Highest Uncertainty Between Certain Bounds 91\u003c\/p\u003e \u003cp\u003eTriangular Distribution 94\u003c\/p\u003e \u003cp\u003eThe Normal Distribution 97\u003c\/p\u003e \u003cp\u003eOther Distribution Functions 100\u003c\/p\u003e \u003cp\u003eMonte Carlo Model of the DCF Template 102\u003c\/p\u003e \u003cp\u003eCombined CAGR and Cost Ratio Uncertainty Distributions 102\u003c\/p\u003e \u003cp\u003eCorrelating Assumptions 105\u003c\/p\u003e \u003cp\u003eAdditional Assumption Distributions 107\u003c\/p\u003e \u003cp\u003eTwentieth (and Other) Percentile Valuations 108\u003c\/p\u003e \u003cp\u003eComparison of Monte Carlo Results with DCF (RAHR) Method 114\u003c\/p\u003e \u003cp\u003eScenario Modeling in Monte Carlo 115\u003c\/p\u003e \u003cp\u003eMonte Carlo Tools for Determining Variable Significance 120\u003c\/p\u003e \u003cp\u003eFinal Points on the Monte Carlo Model 121\u003c\/p\u003e \u003cp\u003eAppendix 5A: Crystal Ball Report Corresponding to the Results Presented in Exhibit 5.15 for a Uniform Cost Distribution Assumption 126\u003c\/p\u003e \u003cp\u003eAppendix 5B: Crystal Ball Report Corresponding to the Results Presented in Exhibit 5.16 for a Double-Humped Cost Distribution Assumption 135\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 6\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eIntroduction to Real Options 147\u003c\/p\u003e \u003cp\u003ePerspective 1: Discounted Cash Flow (DCF) View of the Six-Scenario Opportunity 148\u003c\/p\u003e \u003cp\u003ePerspective 2: Real Option View of the Six-Scenario Opportunity 151\u003c\/p\u003e \u003cp\u003ePerspective 3: A Model for a Buyer’s Counteroffer 154\u003c\/p\u003e \u003cp\u003eBlack-Scholes Equation for Option Pricing 156\u003cbr\u003e \u003cbr\u003e \u003ci\u003eThe Black-Scholes Equation Applied to an Option to a Share of Yahoo! \u003c\/i\u003e\u003ci\u003e157\u003c\/i\u003e\u003ci\u003e\u003cbr\u003e \u003cbr\u003e \u003ci\u003eWhat Do Equations Represent? “What Is Truth?” \u003c\/i\u003e\u003c\/i\u003e\u003ci\u003e161\u003c\/i\u003e\u003c\/p\u003e \u003cp\u003eUsing Black-Scholes for an Opportunity Valuation 167\u003c\/p\u003e \u003cp\u003eSummary of Real Option Realities versus Black-Scholes 171\u003c\/p\u003e \u003cp\u003eChapter 7\u003c\/p\u003e \u003cp\u003eReal Options Applied to Dealmaking 175\u003c\/p\u003e \u003cp\u003eBeyond Black-Scholes 177\u003c\/p\u003e \u003cp\u003eEmergence of Real Options Analysis 179\u003c\/p\u003e \u003cp\u003eIntroducing the Binomial Lattice for Real Options 186\u003c\/p\u003e \u003cp\u003eCalculating Option Values from Binomial Matrices 192\u003c\/p\u003e \u003cp\u003eCalculating Option Values Using Decisioneering’s Real Options Analysis Toolkit 196\u003c\/p\u003e \u003cp\u003eUsing Real Options Analysis Toolkit Software in Dealmaking 201\u003c\/p\u003e \u003cp\u003eCalculating (or Estimating) Option Volatility 204\u003c\/p\u003e \u003cp\u003eCalculating the Option Value of Options on Options 210\u003c\/p\u003e \u003cp\u003eConclusions and Observations 212\u003c\/p\u003e \u003cp\u003eAppendix 7A: Real Options Equations 215\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 8\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eKnowledge and Unertainty 219\u003c\/p\u003e \u003cp\u003eFuture Knowledge 219\u003c\/p\u003e \u003cp\u003eDealing with Uncertainty 221\u003c\/p\u003e \u003cp\u003eStandards 226\u003c\/p\u003e \u003cp\u003eWhat About Truth? 229\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 9\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eDeal Pricing 233\u003c\/p\u003e \u003cp\u003eSimple Pricing 233\u003c\/p\u003e \u003cp\u003eBox Pricing 235\u003c\/p\u003e \u003cp\u003eWheelbarrow Pricing 236\u003cbr\u003e \u003cbr\u003e \u003ci\u003eTotal Cash Payment \u003c\/i\u003e\u003ci\u003e236\u003c\/i\u003e\u003ci\u003e\u003cbr\u003e \u003cbr\u003e \u003ci\u003eCash When \u003c\/i\u003e\u003c\/i\u003e\u003ci\u003e239\u003c\/i\u003e\u003ci\u003e\u003cbr\u003e \u003cbr\u003e \u003ci\u003eCash Maybe \u003c\/i\u003e\u003c\/i\u003e\u003ci\u003e239\u003c\/i\u003e\u003ci\u003e\u003cbr\u003e \u003cbr\u003e \u003ci\u003eCash As \u003c\/i\u003e\u003c\/i\u003e\u003ci\u003e240\u003c\/i\u003e\u003ci\u003e\u003cbr\u003e \u003cbr\u003e \u003ci\u003eCash Substitutes \u003c\/i\u003e\u003c\/i\u003e\u003ci\u003e240\u003c\/i\u003e\u003c\/p\u003e \u003cp\u003eTerm Sheets 241\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 10\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eNegotiation Perspectives and Dynamics 243\u003c\/p\u003e \u003cp\u003eNegotiation Perspectives 243\u003c\/p\u003e \u003cp\u003eNegotiating Sequencing 246\u003c\/p\u003e \u003cp\u003eIssue Explosion 249\u003c\/p\u003e \u003cp\u003eNegotiating Values 252\u003c\/p\u003e \u003cp\u003eDeal\/Agreement Complexity 252\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 11\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003ePlan B 255\u003c\/p\u003e \u003cp\u003eAuctions and Betrothals 255\u003c\/p\u003e \u003cp\u003ePlan B Analysis and Tools 257\u003c\/p\u003e \u003cp\u003ePlan B Implementation 265\u003c\/p\u003e \u003cp\u003ePlan B Caution 266\u003c\/p\u003e \u003cp\u003ePlan B from the Buyer’s Perspective 267\u003c\/p\u003e \u003cp\u003ePlan B and Life 267\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 12\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eConclusion 273\u003c\/p\u003e \u003cp\u003eIn Theory, In Practice 273\u003c\/p\u003e \u003cp\u003eValue Creation by Dealmaking 274\u003c\/p\u003e \u003cp\u003eA Final (True) Story 278\u003c\/p\u003e \u003cp\u003eBibliography 281\u003c\/p\u003e \u003cp\u003eIndex 283 \u003c\/p\u003e RICHARD RAZGAITIS is a managing director at InteCap, Inc. A recognized leader in the field of licensing and valuation, he has over twenty-five years of experience working with the development, commercialization, and strategic management of technology, seventeen of which have involved the commercialization of intellectual property.   \"The underlying purpose of this book is to empower negotiation for business-to-business dealmaking of business opportunities using analytical tools and planning procedures. The focus on practical tools and procedures that can be justifiably used in a business context distinguishes the book from a vast catalog of other negotiation books.\"\u003cbr\u003e –From Chapter 1  \u003cp\u003eBusiness negotiation is often characterized as a \"take it or leave it\" battle of wits between buyer and seller. But it is much, much more. In reality, business negotiation involves two parties–perhaps business adversaries or perhaps business allies–faced with reaching a reasonable value-enhancing agreement from a range of possible options.\u003c\/p\u003e \u003cp\u003eDealmaking Using Real Options and Monte Carlo Analysis details how you can employ two of today’s most powerful decision-making tools–Real Options Analysis (ROA) and Monte Carlo Analysis (MCA)–to effectively prepare for every negotiation by comprehensively and rationally representing myriad possible futures. This uniquely hands-on book outlines a step-by-step process for determining what you want, learning why it is reasonable to hold such a view, and successfully communicating that knowledge to both internal stakeholders and those on the other side of the negotiation.\u003c\/p\u003e \u003cp\u003eRichard Razgaitis, an influential thought leader in the field of licensing and valuation, walks you through the tools and approaches of ROA\/MCA joint usage, including:\u003c\/p\u003e \u003cul\u003e \u003cli\u003eReal Options Analysis–sometimes referred to as \"Black-Scholes\" analysis, it is valuable for determining pricing structures, or options, for such outcomes\u003c\/li\u003e \u003cli\u003eMonte Carlo Analysis–an increasingly popular tool for determining the likelihood and significance of a complete range of future outcomes\u003c\/li\u003e \u003cli\u003eChecklists, case studies, web site addresses–for further business and negotiation resources\u003c\/li\u003e \u003c\/ul\u003e \u003cp\u003eIn the no-quarter world of business negotiation, a patient and methodical inquiry into all relevant matters is not practical. At the same time, rapid analysis may not provide the data required to satisfy all parties. What is needed is a model that takes into account the speed and urgency required to effectively prepare for a negotiation while allowing rational and defensible analysis of the numerous real options.\u003c\/p\u003e \u003cp\u003eDealmaking Using Real Options and Monte Carlo Analysis introduces that model. This practical, results-based book unveils a negotiating system that achieves the dual goals of speed and reasonable certainty, and is destined to become the method of choice for reaching outcomes designed to satisfy all parties in the negotiation.\u003c\/p\u003e  An Innovative, Tool-Based Process for Creating More Rational, Creative, and Mutually Beneficial Deal Structures and Valuations  \u003cp\u003eReal Options Analysis (ROA) and Monte Carlo Analysis (MCA) are two of today’s most significant tools in the valuation and negotiation of high-potential-value, high-ambiguity deals. Dealmaking Using Real Options and Monte Carlo Analysis outlines a new approach for creating flexible, practical valuation models by combining ROA and MCA into one innovative and proven successful process.\u003c\/p\u003e \u003cp\u003eThis results-based book takes you beyond uneven, rule-of-thumb negotiation tactics and strategies to discuss how you can:\u003c\/p\u003e \u003cul\u003e \u003cli\u003eAccurately evaluate the potential costs of going forward with–or scuttling–a business project\u003c\/li\u003e \u003cli\u003eEnsure that both sides in every negotiation work from similar valuation terms and processes\u003c\/li\u003e \u003cli\u003eDevelop and implement efficient strategies for bringing negotiations to closure\u003c\/li\u003e \u003c\/ul\u003e \u003cp\u003eIn preparing for any business negotiation, the goal is to identify opportunity and characterize risk; during the actual negotiation, the goal is to capture value while arriving at terms that are favorable to everyone. Dealmaking Using Real Options and Monte Carlo Analysis introduces a process for achieving both goals, by focusing on practical tools and procedures that take into account the full range of opportunities–and lead all sides to the identification and selection of optimal choices.\u003c\/p\u003e","brand":"Wiley","offers":[{"title":"Default Title","offer_id":47989028520165,"sku":"NP9780471250487","price":61.95,"currency_code":"USD","in_stock":false}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/1842\/7735\/files\/9780471250487.jpg?v=1761782499","url":"https:\/\/k12savings.com\/products\/dealmaking-isbn-9780471250487","provider":"K12savings","version":"1.0","type":"link"}