I often surprise bank clerks by actually reading those long, small-font agreements that go with a new account or a debit card. I don’t always read them word for word but I always try to get a good grasp of the key points before I put my signature on the document.
The higher the stakes, the more time I take analyzing the papers. When we were closing the first investment round for my current company, it took us maybe 10 back-and-forths and a lawyer’s involvement to finalize the Shareholders’ Agreement. And I’m glad I went through this because there were numerous omissions in the first draft that would put me in a seriously disadvantaged position.
(The lawyer later told me that many founders sign that stuff without reading, and that it was so good I wasn’t one of them.)
You see, I’m not afraid to take the other party’s time, look dumb or mistrusting. You agree to every word of the document that you sign, so you better be very familiar with its contents.
I’m also not afraid to ask questions (see “being dumb” above). If you don’t understand something in the agreement, ask for it to be explained to you.
It also goes without saying that you don’t have to sign a document that you don’t agree to. If some key points are missing or just plain wrong, ask to have them corrected. Don’t succumb to pressure, which the other party will sometimes try to mount on you. Keep calm and be fine with walking away from the deal if you are not 100% comfortable with the papers.
A written agreement usually supersedes any prior discussions and promises made before signing. Make sure that the document reflects exactly what was agreed on. Read what you sign – that’s what the successful people do.