Contracts Are a Financial Weapon: Megan Shapiro on Risk, Cash Flow & Confidence

Rishi Srivastava (00:41)
Today our guest is Megan Shapiro. Megan, welcome.

Megan Shapiro (00:45)
Thank you, excited to chat with you today.

Rishi Srivastava (00:47)
The first section here is on contracts as financial strategy. Many construction CFOs admit contracts are their biggest blind spot. From your experience, what are the most common mistakes you see subcontractors make before signing, especially when it comes to risk and profitability?

Megan Shapiro (01:07)
You know, honestly, probably the biggest mistake I see for the trades in particular is not reading the contract at all. And that happens because they have bought into this narrative that I think the general contractors like.

Rishi Srivastava (01:14)
Good.

Megan Shapiro (01:20)
having pushed out there, that the subcontract is not negotiable. So if they need the work, if they need the income, if they need that job to be able to keep the doors open and keep their field guys paid, they’re gonna sign the contract and take the job regardless of what the contract says. And so if you come at it with that mentality, then it doesn’t matter if you read it. And in fact,

it might be a little bit more comforting to not read it if you know you’re gonna sign it regardless of what it says because it’s sort of like the old monkey, right? See no evil, hear no evil, speak no evil. Like what you don’t know can’t hurt you. And so if you don’t read it, it’s not scary and you can just sign it and put it away in a drawer and cross your fingers and hope that nothing goes wrong in the project and that it never matters that you didn’t sign it. So that’s definitely the biggest one that I see for trade contractors in particular.

Rishi Srivastava (01:50)
Thank you.

Reading those contracts, seems daunting. I’ve signed so many contracts and I don’t read them.

Megan Shapiro (02:10)
Yeah, and to be fair, I sign a lot of contracts that I don’t read either, right? You know, like we all agree to those terms of service when we get our new iPhone or we download that new app, right? Like there are tons of contracts we all sign every day without reading. So I’m not saying everybody needs to read every contract every time. But in terms of…

being a little bit more proactive in your risk management strategy, particularly in your business, it’s a good idea to read the contracts, even if you are in that unfortunate position of feeling like you don’t have any ability to push back, although I would challenge that assumption. I’ve got some strategies around getting red lines accepted even in the face of a we don’t accept red lines policy. But even if that is the case and they truly won’t accept red lines and you really do have to take it or leave it, I still encourage you to read the contract because…

What you don’t know can hurt you because at a minimum, you need to be able to comply with what’s in there, even if you can’t change it. And that is no more prevalent than when it comes to notice requirements. And so I see a lot of claims inadvertently get waived because people haven’t complied with the notice requirements because they didn’t know what they were, because they didn’t read the contract.

Rishi Srivastava (03:11)
Yeah. You often say your contract should work for you, not on you. What does that mean in day-to-day financial operations for a CFO or controller trying to manage cash flow and exposure?

Megan Shapiro (03:25)
Yes, so the sort of like not own you comes from my own framework. So that stands for optimize way and negotiate. And that’s sort of the framework that I teach as the approach to contract review red line and negotiation strategy. And so when I say that the contract should work for you and not own you, it’s sort of in reference to that framework. And so high level, what that really means is the contract should not be an intimidating thing. It shouldn’t be something that you’re afraid to look at, afraid to read.

feels overwhelming for you to read, read, and understand, it should really be one more tool in your toolbox for a successful on time, on budget completion of the project. And so it really comes down to taking out that intimidation factor of the contract and feeling more confident and comfortable reading them and reviewing them. again, even if you don’t have the ability to red line and negotiate them, you at least feel confident in your ability to understand and execute and implement what’s in the contract because

really is a tool and you shouldn’t be intimidated by your tools.

Rishi Srivastava (04:25)
Yeah, actually long time ago somebody told me these long contracts, if you just read the headings, sometimes you get enough. Am I thinking about it right or no?

Megan Shapiro (04:35)
I mean, it’s definitely better than not reading anything at all. I’ll give them that. And certainly it would depend on whether the headings are just like one word, like, indemnification. Well, OK, no surprise there that there’s indemnification in the contract. Every contract has that. So that’s not really all that informative. But if they’re the kinds of headlines where it’s complete sentences, then that might be a little bit more helpful. But sure, I’ll take reading anything over reading nothing.

Rishi Srivastava (04:57)
Yeah. You built your own framework, optimize, weigh, negotiate. How can finance leaders use that process to evaluate agreements more strategically, not just legally?

Megan Shapiro (05:13)
So it’s a very simple framework that, and it’s simple in that it’s easy to understand, but even more importantly, it’s easy to implement. And that’s why I sort of developed it to work with the people that I work with and coach and train and lecture to and all of that stuff, because my whole premise is I want to teach you how to review Redline and negotiate a contract like a lawyer. Do it like a lawyer so you don’t need to call me every time a new contract comes across your desk. So the foundation of being able to do that is to give you a framework that you can implement on your own without needing

And so what it really comes down to is

It’s a true three-step approach. So you start with optimize which essentially means you read through the contract so that you can understand The overall I call it the vibe check, right? You have to do this sort of vibe check for the contracts that you get an idea as to out of the gate How fair is this how much does this particular contract attempt to balance the risk? Is it a very one-sided contract that is pushing all of the risk onto you? Is it a little more middle of the road or are you the unicorn that received a contract? That’s overly fair to you

⁓

Obviously, that doesn’t happen very often. It’s usually one of those first two. But you can’t really get that full vibe check without reading all the way through the contract at least one time, which will help you then understand where you’re going with that contract so that you can identify as a company or as the business owner, whoever it is that’s actually reviewing the contract, what is your internal risk tolerance? What level of risk are you willing to assume in a contract? And that helps you then go to the next step, which is way.

you’re looking at the weigh step, what you’re looking at is those individual key contractual provisions, the eight key contractual provisions that have the biggest impact on overall profitability and overall risk management for the company based on this particular contract and this particular project. And so you weigh what is written in the contract. How favorable is it to you now? And how significant is it to you if it goes south? So that helps you then determine what your negotiation strategy will be, which is of course then the third step in the framework. Once you’ve optimized it, weighed it, then it’s time

to negotiate it. And we talk through again how you can sort of get your red lines accepted, which is why I challenge anybody who is under the belief that there is a true no red lines accepted position that all general contractors will take, that there is a way around that there is a foot in the door that you can at least try and see where it goes. My final caveat on that is if you’re working with a general contractor who truly has a no red lines accepted policy that is a hard and fast rule they do not negotiate, I would encourage trade contractors to consider whether that’s a partner that they really want to do business with.

If they’re already that stubborn out of the gate and already that unwilling to work with you in a true partnership capacity, it’s probably only going to get worse on the project, particularly if something goes south. And so that might be a true red flag. And by the way, my system reserves the concept of red flags for true deal breakers. I only call something a red flag if I’m willing to say you might not want to enter into this contract. You might want to actually walk away from this because the stakes are so high. And a true no red lines accepted policy from a general contractor is

oftentimes a red flag for me.

Rishi Srivastava (08:14)
Yeah, that makes so much sense. And if you’re not willing to accept this piece of paper from me, I mean, what happens when real chaos ensues on the field? ⁓

Megan Shapiro (08:23)
Exactly,

exactly.

Again, I’m not teaching trade contractors to ask for the moon. I’m teaching them on those red lines to ask for a bit of a more fair balance of the risk, right? I’m not saying put it all back on the GC. I’m just simply saying let’s find a middle ground that allows us to balance the risk fairly and acceptably to both sides. And so in the face of that, the response from the GC is no, we’re not even going to talk about it, we’re not even going to consider it, then they’re not a true trade partner. They’re not a partner at all, right? And so that’s why to me that becomes

become a red flag.

Rishi Srivastava (08:55)
So just to clarify for our listeners, your focus is on subcontractors. They are the people you’re teaching,

Megan Shapiro (09:03)
I tend to attract subcontractors more than anyone else, but my system does actually work with general contractors as well. The same strategies, frameworks, and implementations work with the prime contractor when you’re negotiating with the owner. So it’s all the same, right? So instead of calling it the general contractor or the trade contractor or subcontractor, you can also conceptualize it as the upstream contracting party versus the downstream contracting party. And so my framework really caters to the downstream contracting party. So whether that’s a sub-tier subcontractor

whether that’s design professional, whether that’s a material supplier. It’s anybody that is on the receiving end of the contract that has been prepared by the other side. My system will work for reviewing redlining and negotiating those contracts.

Rishi Srivastava (09:46)
Thank you. The next section here Megan is on the risk, profitability, and AI. You said most trades are cost-conscious and can’t afford ongoing AI subscription models. What’s your advice to companies weighing between paying for AI tools like DocumentCrunch versus investing in team training?

Megan Shapiro (10:07)
Yeah, so I guess my caveat to that is I don’t work for any of these AI companies, so I don’t necessarily have a good…

updated understanding of what they’re charging currently, right? I mean, I think with AI as quickly as it evolves, I think those pricing models are probably evolving just as quickly. So my position on that comes from the feedback that I get from my clients who have done the demos or done the trials and have had those conversations about the ongoing subscription costs for a lot of these AI contract management tools. So that’s my sort of disclaimer caveat of where my position on this is coming from. So with that in mind, my position on this is

By definition, all of those systems require an ongoing subscription model. I haven’t seen anywhere it’s up, you pay one fee and it’s lifetime access with updates all the time. haven’t seen, I’m not saying they don’t exist. I’m just saying I’m not aware of any.

by and large the most popular model is a subscription model, whether you’re paying monthly or it’s a year long subscription, but it’s still something that is going to be a recurring cost on some time period. My position on that is it’s a much wiser financial investment for the company to invest in teaching your people how to do it themselves, right? Investing in that training because you learn it once and then you have it forever. You can implement it with every contract that goes forward.

response to that is, but what about turnover, right? What about when the team that you’ve trained leaves and goes somewhere else? Totally valid point. But my position on that is the same, which is ongoing investment in training your team is always going to outweigh a never-ending subscription model base. Because even if your team turns over and you have to reinvest in the training, it’s still better than a never-ending subscription model.

For me personally, I mean, I know I’ve got a ton of competitors out there who offer this type of training. I can’t speak to their model, but my model, I’ve got a pricing structure that will allow lifetime access to the training anyway. So you pay me one time, you pay a little bit more for the lifetime access, of course, right? Because then obviously I’m pricing myself out of the work if I give you access for free forever, but then you can use it with new team members. I’ve had several clients who have taken the training that I have done and they’ve implemented it into their onboarding strategy for new project.

new contract managers, whoever it is within their particular business hierarchy and whoever is responsible for reviewing their contracts, when those new people come on, part of their onboarding is going back and watching the videos of the trainings that I have done. And that’s a one-time cost. They’ve invested in it once, and now they never have to invest in it again. And it’s certainly not a recurring expense every month or every year, as long as they want to have that capability. So I always think that it’s a wiser choice to invest in your people. It also goes a long way for showing

your employees goodwill, right? Like you’re fostering a culture that I think is a much more positive workplace. I mean, we all live in this world where we know that people are afraid of AI replacing them. That’s a real concern that many people across all industries, we’re not just talking about construction, right? Across all industries, we all have that concern. Is AI going to replace us? It’s a fear and an anxiety, but if you are a business leader and you’re showing your team, you don’t have to worry about this. Maybe we use AI tools. I’m not saying we should be

anti-AI that would that’s

unrealistic in our day and age and how quickly and evolving AI is. That’s unrealistic. But maybe we invest in AI tools, but we’re investing in you as well. We’re going to teach you these new skills that are transferable for you. You now have this added skill set that we hope that you continue to use with us. And that’s the goodwill piece, right? And we’re willing to take the risk that you’re going to take that skill set to your next employer. And we’re still going to invest in you anyway. And so I think that there are a lot of good benefits to a construction company.

for choosing to invest in their employees as opposed to this ongoing subscription-based model for AI, or at least as opposed to that being the only method of contract review is an ongoing AI-based subscription model.

Rishi Srivastava (14:04)
Yeah, I remember a quote. One owner asked someone, what if I train this employee and she leaves? The consultant says, what if you don’t train and they stay?

Megan Shapiro (14:17)
Yeah, absolutely, absolutely. Or what if you don’t and they leave because you didn’t?

Rishi Srivastava (14:22)
You teach leaders to learn the skill once and own it for life. How does that mindset shift a company’s long-term risk management and financial independence?

Megan Shapiro (14:34)
biggest shift is mindset honestly I mean once you take that shift from being and viewing the contract is an intimidating thing right this thing that you want to ignore or even if you’re not ignoring it you’re doing your best

based off of, you know, experience that you may have had, but you haven’t really had any real training. You haven’t really, you don’t have a systematic approach to doing it. Once you remove all of those barriers, you have that mindset shift of confidence when it comes to your contract reviews. And that alone is worth its weight in gold, right? Having that mindset shift of a confidence in your approach to reviewing, redlining, and negotiating these contracts changes everything. It makes you feel more empowered in terms of

which contracts you’re willing to negotiate, what attempts you’re willing to make, what red lines you’re willing to ask for. It gives you the confidence to consider walking away from the projects that might not be the best for the company based on its overall risk tolerance and its risk strategy long term. It just gives you this power of control over what is a very fundamental financial part of your business. It gives you this control over it because you’ve got the confidence that it’s not this thing that you have

afraid of that you don’t understand.

Rishi Srivastava (15:48)
Yeah, contractors don’t run out of work. They run out of cash.

Megan Shapiro (15:53)
Yes. Yes.

Rishi Srivastava (15:54)
From your perspective, what are the top contract clauses that most directly impact profitability and what simple changes can dramatically reduce financial risk?

Megan Shapiro (16:05)
That sounds like a simple question, but I can literally do like two hours on that question alone. So I’ll give a high level answer with the caveat that like, this is basically what I post about on LinkedIn every day. So your listeners are more than welcome to follow me on LinkedIn and they’ll get a little bit more nuance and detailed as the answer to this particular question, but I could talk about this for hours. I’ve distilled it down to sort of what I call the eight key contractual provisions. And I identified those eight key provisions based off of, in my experience, well, let me back up because your

listeners may not know where I’m coming from. So I’ve been a construction attorney for about 15 years and the bulk of my experience has been on the litigation side. So when projects go south and people start suing each other, that’s when I come into the picture. I’m not on…

the bulk of my career, I wasn’t on the front end doing what I now teach about negotiating the contract before we ever get into this situation. My clients would, I wouldn’t really get involved until after it already went south. And so I come at my approach to contract review through that lens of having seen all the ways that it can go super far south, right? And how it can impact the downstream party to the contract from a financial standpoint. So that’s the background, right? So based off of all of that, all of those lawsuits and litigations

experience. I realized that there were about eight key provisions in every single construction contract that were the biggest

pivot point that had the highest likelihood of Contributing to the financial success or the financial ruin of the downstream contractor if things went south And so I really focus my approach around those eight key provisions as an aside Distilling it down to eight key provisions has the added benefit of again reinforcing that confidence and taking out that intimidation factor instead of Saying to people. Okay, let me give you an approach to reviewing a 55 page contract. Let’s go page by page line by line

Nobody wants to do that and I get why they don’t and really you don’t need to again Like I said, you need to read the contract all the way through one time to get that vibe check But really when it comes down to the nitty-gritty you can focus on eight key contractual provisions, right? And so these provisions are going to come as no surprise to anybody who has reviewed construction contracts and particularly will come as no surprise to anybody who’s been Unfortunate enough to have been involved in litigation that has arisen out of a contract dispute. So we’re talking about things like payment terms We’re talking about change orders. We’re talking about notice provisions. We’re talking about term

We’re talking about indemnity. We’re talking about these things that are really the crux of what ultimately becomes the dispute if it can’t be resolved based on the goodwill and the relationship when problems start to arise on a project. And so those are kind of the eight, that’s kind of where we go from there in terms of what is the real difference maker in the contract review.

In terms of easy to implement strategies for how you can better manage those eight key contractual provisions, that’s the thing that I could talk about forever, right? And so for that, mean, like a quick and dirty, a few quick and dirty tips, make sure that days in the contract, particularly when it comes to notice requirements or things like that, or notice is secure, make sure that days has a definition and that you’ve agreed upon the definition and that the definition has been optimized to your risk management. So if you’re the downstream contractor and you’re going to be

on

the receiving end of let’s call it a three-day notice to cure, right? Like let’s say the general contractor or the owner has looked at the downstream contractor and said, you’re falling down. We need you to better perform. So we’re gonna give you a three-day notice to cure whatever the alleged deficiency is. Well, three days undefined, does that include weekends? Does that include holidays? We don’t know.

If you’re the downstream contractor on the receiving end of that, you want to maximize how much time that is. What you never want to have happen is allow a methodology of calculation to be where the upstream party can give you that notice at, say, 5 p.m. on a Friday. And now the clock is ticking over the weekend. Maybe nobody even saw the email that came in at 5 p.m. on Friday because it’s Friday and everybody took off at four because they’ve been working since six. Nobody even saw the email. Now we come into the office six, seven a.m. Monday morning and we’re already two days

into our notice, we now have mere hours left to perform, right? And now we’ve got to mobilize and we’ve got to figure out what the cure is and all of those things, right? And so that’s quick, easy thing to implement. Look at the definition of days, define it in a way that will maximize your time to actually respond. I like hours depending on who you are in the contract, but I always like to be clear that it doesn’t include weekends, it doesn’t include holidays, it would only include, I mean, maybe you’re in a contract where Saturdays are part of your regular performance schedule.

not going be able to exclude those, but you can tie the days as defined in the notice requirement to the days that you’re actually on site. There are ways that you can sort of massage that language to make sure that you’re giving yourself the most amount of time to actually fix the problem.

The negotiation strategy, by the way, in response to those general contractors or owners that want to push back and say we don’t accept red lines, the negotiation strategy point is this doesn’t hurt anybody. Clarity helps everybody. Ambiguity in a contract equals cost to all parties because if we have to fight about what a term in a contract means, then that means everybody is spending money on people like me. So let’s not spend money on lawyers. Let’s get on the same page out of the gate. And sometimes it doesn’t even matter what the clarification is. What matters is that we have clarification

Rishi Srivastava (21:03)
Mm-hmm.

Megan Shapiro (21:21)
verification

so that we remove the ambiguity and we don’t have to pay the lawyers if we get into a dispute down the line. So that’s the negotiation strategy. And again, to sort of bring it full circle to what I alluded to earlier in our conversation, that’s one negotiation point that gets your foot in the door in response to those GCs or owners that say we have a no red lines accepted policy. When you put it to them that way, it puts them in a really weird position to still say no, right? And once they’ve said yes to one thing, it makes it a lot harder for them to say no to anything else.

Rishi Srivastava (21:50)
Yeah, any subcontractor listening, Megan is your person for these kind of contract issues.

Megan Shapiro (21:57)
Thank you.

Rishi Srivastava (21:58)
The next section here is on learning, technology, and human judgment. You mentioned that AI tools can work well for experienced reviewers, but not for beginners. How should companies build a strong human foundation before layering in automation?

Megan Shapiro (22:17)
Yeah, so we kind of actually already talked about this earlier and I didn’t even really think about the connection to this question. But to the point of even the subscription-based AI tools that will help with the contract review. AI is super powerful. Like I don’t want to leave any of your listeners with the impression that I’m anti-AI. I’m not at all anti-AI.

What I am is anti-AI without any understanding and knowledge and foundation. What I am is anti putting all of your faith and trust in AI, right? Because it does still get it wrong. As.

sort of social proof that I know what I’m talking about, I utilize many of the AI tools out there. As a disclaimer, I don’t utilize many of the paid subscription-based tools that market themselves as specific to contract review, right? Like I don’t have a subscription to Document Crunch, but I do have a paid subscription to ChatGPT, I do have a paid subscription to Gemini, I have a paid subscription to NotebookLM. Like I use these tools, right? And so I test these things. I will run contracts through it and I will ask it, you are…

highly respected, very skilled contract construction review attorney in California. Please review the attached contract and highlight for me the areas of risk that I as a subcontractor should be concerned about, right? Like I tested.

And what I have found is that it gets it right most of the time, but it gets it really, really wrong sometimes. And that’s what gives me heartburn on behalf of people who use it that don’t know what they’re looking at. It’s fine for somebody like me because I know when it’s wrong. But if I don’t know how to identify when it’s right versus when it’s wrong, then I’m exposing my company to even more risk than doing nothing at all. Right? And so that’s what gives me concern. And so to bring it back

the question that you actually asked, I think that the ideal marriage of AI tools versus investing in the humans that are in your business is, again, give them the knowledge, empower them, give them the training that gives them the basics, the understanding, the knowledge to be able to use the AI tools so that they can recognize when those tools are wrong. And then here’s the key. Not only do you know when the AI is wrong, but you’re now not frozen in fear.

of, I don’t know, okay, I know it’s wrong, but now what do I do with that? I won’t follow that advice, but then what do I do? So invest in your people to give them the knowledge and the tools on their own to be able to leverage and maximize the capability of AI so that it’s not just machine and it’s not just human. Let’s marry the two together and create a powerhouse of contract review. And I think that that’s the ideal situation.

Rishi Srivastava (24:53)
You said it so well. We do accounts payable with AI. And if you give our AI to an untrained accounts payable person, they’re not going to be able to use it well. They’re going to make mistakes. Once they are trained and they need that next level up, all the mundane stuff needs to go away. That’s when our AI comes and helps a trained accounts payable person.

You emphasize using your brain before your tech. How do you help leaders develop that confidence, especially in a world where everyone’s tempted to let AI think for them?

Megan Shapiro (25:28)
think, unfortunately, think like…

some for some people it’s going to take having it bite them in the butt, right? I think we’ve got an overconfidence in AI outputs right now. And from my perspective, because I said I’m testing these things all the time, right? I also teach construction law and contracts for the University of California Davis and they’re continuing a professional education school. And so I’m always running our homework through there, right? To make sure that my students are not actually, you know, using AI to cheat and all of those things. So I really truly am testing these things.

regularly, okay? And the outputs have gotten worse over the last year. The amount of contract understanding mistakes that AI, again, I’m using many tools, so I’m not talking about any one in particular. I tested across a lot of the different tools available. The amount of mistakes has increased over the last year, not decreased. And I think consumer confidence in AI tools has increased and not decreased, right? So we’ve got this inverse situation where our users think that

output is better and the output is actually worse, which creates the worst possible situation in terms of relying on those tools without having the brain work behind it, the human intellect behind it, the human check behind it, right? And so because I keep seeing it over and over and over again and the confidence level is so high, I fear that we’re in a place where it’s going to take people getting bitten, ending up in litigation or ending up in a dispute or arbitration or something like that

before they start to really understand that

the AI tool, the technology tool is only as good as the user who’s using it because again, to the point that I previously made, if you don’t know when it’s wrong, then you’re going to be getting crap in, crap out, right? And so what I would say to leaders is that is the importance of investing in the brain. And as the user, right, if you’re the one, if you’re the contract manager, the project manager, the one who is responsible in your company for reviewing those contracts,

give yourself that gut check. Do not get complacent and comfortable that chat gpt or Gemini is going to give you a bulletproof answer. Don’t outsource your own intellect. Don’t get so lazy that you’re just relying 100 % on that without doing any of your own gut check.

Rishi Srivastava (27:44)
Yeah, that’s so true. If you had to design the ideal contract education program for a construction CFO, what three skills or habits would you make mandatory?

Megan Shapiro (27:59)
You know, it’s so interesting that the question sort of caveats around for CFOs in particular. And the reason, that’s interesting for several reasons. So first of all, it’s rarely the CFOs that are my clients or that I am training, right? Because they’re not usually the ones that are responsible for reviewing Redline and negotiating the contracts or even really implementing them, right? Like the CFOs overlap with the contracts themselves is usually limited to like making sure you’re following and understanding the payment terms, right? Because your finances,

Rishi Srivastava (28:14)
No.

Megan Shapiro (28:27)
a CFO, so all you care about from the contract is like when are we getting paid? Right? And rightfully so. And so I don’t often encounter CFOs in my world of people who I am trying to educate and train.

Now that said, I have a very good, I’m gonna call him a friend. He’s become an actual friend now. He’s a fractional CFO who I met through LinkedIn about two years ago, Josh Lubker. And he and I have become friends. We’ve met in person. And so I would call him a friend. think he would call me a friend as well. And because we’ve got such a good strong friend basis for our relationship, he challenges me all the time, right? Like he follows my LinkedIn posts. We also have a text message and we will chat about these things. And I’ll say these, I’ll give these contract basis

tips, right? I’ll say these things about contracts. And with his CFO hat on, he’ll challenge me and he’ll kind of come back and say like, well, okay, I can see why you say that. But from a finance standpoint, here’s why I kind of disagree or here’s why I think that that doesn’t necessarily make sense. Or I would approach it differently, even the red lines. And so I really appreciate that completely different perspective because again, it’s not an experience that I have to draw upon. I don’t deal with CFOs. They just, we just don’t have much overlap.

And so I’ve really been challenged over the last couple of years that I’ve had this relationship with him and we’ve butt heads, right? Like he’s not always been able to convince me that his way is better because I will never be able to set aside the experience that I’ve had and how these things can go south while I am understanding and sympathetic to his concerns from a pure finance standpoint that has to be balanced with like, okay, I get it. But if this goes south, here’s what could happen. And then your finance concern doesn’t matter because there isn’t.

company. Right? And so we have we engage in some in some good faith debate about that. But because of that, I don’t have a great answer for you because that’s not really the basis of my experience. So I guess all of that is a long-winded way of saying to all of your listeners and viewers, go follow Josh Lubker because he also talks about contracts, but he does it through the lens of CFOs. And Rishi, he might be a great guest for you to have too, because I have a feeling that you guys would see eye to eye on a lot of these a lot of these issues. He’s a great resource for a lot of this stuff.

Rishi Srivastava (30:34)
Hmm, okay. I can definitely reach out to him. Yeah, I mean, in my world, a lot of times the contracts are actually negotiated by CFOs, you know, like the, I think so, at least like the SMB. So the owner is kind of giving it to the CFO to review.

Megan Shapiro (30:46)
Really? Wow.

Wow, that’s so interesting. usually, I’ll see COO, I’ll even see CEO, but more often I’ll see like a VP or a contract manager and the most common is a project manager.

Rishi Srivastava (31:07)
Hmm. The next section here is on communication, performance, and influence. You said trial lawyers are performers, and you see yourself as one too. How can finance leaders bring that same sense of preparing and presence into high stakes negotiations?

Megan Shapiro (31:29)
So this answer is applicable to anyone who’s going into any negotiation. My position is the number one thing that you can do to put yourself in the best possible negotiating position and increase your likelihood of succeeding, whatever that means to you, right? Whatever your ask is in the negotiation is to be overly prepared.

And by that, I do not simply mean be prepared based off of what you know your desired outcome is and you know what your sort of bottom line is. To be truly prepared and to put yourself in the best possible position, you need to also know or at least do your best to approximate. And by that, what I mean is actually dig in and give some real thought to.

what the other side’s best outcome is and worst case scenario is also good to know for the other side, but also their sort of bottom line.

Because, this comes from Getting to Yes, by the way. Getting to Yes is a book by the Harvard Negotiation School. I’m a big advocate of Getting to Yes as a negotiation framework. Big follower, big advocate. I use it myself. And they talk about this concept of sort of BATNA, which is the best alternative to a negotiated agreement. WATNA, worst alternative to a negotiated agreement. But I think to me, the real secret in that sauce of the Getting to Yes formula is that part of

doing the work for your opponent, for the other person that you’re negotiating with. Because it’s easy to figure out what you want and what your walk away or bottom line deal is, but it’s harder to figure it out for the other side. And the closer you can get to approximating what that is, the more power you have in the negotiation, particularly because I find most often the other side hasn’t done that for you. And so by definition, you’ve got more information than they have, and that always puts you in a better negotiating position. And so that’s,

think the number one key to sort channeling that performance aspect, because of course all performers are prepared, right? Even improv performers have perfected the preparation of being able to perform improvisationally. Nobody performs well without some kind of preparation. And when it comes to negotiation, in my mind, that’s the best form of preparation is knowing your own goals, your own bottom line, and then doing your best to approximate those for your opponent.

Rishi Srivastava (33:52)
Approximating your opponent’s strategy gets tough.

You teach people to do it like a lawyer, TM, to think critically and communicate with clarity. How does that mindset help construction professionals make faster, more confident decisions?

Megan Shapiro (34:12)
So the idea, the whole idea behind Do It Like a Lawyer is I want to show you how I do it so that you can do it that way without needing me. And that applies not only to contract review, but that applies to negotiation strategy, that applies to communication, particularly when it comes to difficult conversations, that applies to women trying to maneuver within male-dominated industries like construction and law. So the entire idea behind that is let’s take these frameworks that are somewhat useful

unique

to lawyers and apply them to other contexts so that you have the confidence. It all comes down to confidence, right? We can wrap it in whatever package we want to wrap it in, but at the end of the day, it’s really about confidence. We’re always going to have better outcomes if we come into a situation confident, confident in our own knowledge, in our own experience, in our own positioning, in our own voice. All of those things lead to better outcomes. And so my approach to everything that I teach,

whether it’s my workshops for women in male-dominated industries, whether it’s my training for how to review Redline and negotiate a contract, all of it comes down to, let’s take these lawyer frameworks that non-lawyers are not often exposed to, let’s implement them, let’s practice them, all with the idea of instilling the confidence that lawyers bring to the table, or at least show you how to fake it like lawyers, because we fake it till we make it too, just like the best of us, right? We all do it, right? So I’ll even teach you how to do that. I’ll even teach you how to fake it like a lawyer.

That way we come into every room, every situation, whatever it is, because again, it’s all about confidence, the situation doesn’t matter. Bring that confidence so that you can perform at your best, at your highest, and get the best possible outcome available to you. You’re not always gonna get your best ask, you’re not always gonna get the outcome that you want, but you will at least know that you brought your best foot forward. You did your best, and so whatever outcome there is was the best available.

Rishi Srivastava (36:07)
Yeah, do it like a lawyer. I like that phrase. You mastered communicating with authority in both law and construction, two very male dominated spaces. What lessons have you learned about balancing confidence, humility, and credibility?

Megan Shapiro (36:09)
Do it like a lawyer.

Boy, that is a tough one because…

There’s no universal answer. And this is why the coaching that I do with women in male dominated industries around these ideas of competence and communication style and all of that is so tailored and specific because it hinges not only on the inherent natural personality of the woman, of the person, right? But it also hinges on the person that they’re talking to or negotiating with or communicating with or whatever it is. And so my

process involves a lot of trying to get into the head of the other party as much as possible so that we can gather as much information as possible because I don’t believe in a one-size-fits-all approach, particularly for women in male-dominated industries when the person that we’re negotiating with is a male or communicating with, I say negotiating with as a sort of placeholder, right? But whatever that conversation is because

I might need to embody a different approach depending on who I am talking to, depending on what my desired outcome is. So I sort of bristle when I hear other people who sort of try to empower women in these spaces to simply say like, do it like a man does it, or don’t listen to the she’s too assertive and so she’s also a bitch, just be as confident as they, like I kind of bristle at that because.

That’s gonna bite you in the butt if you take that approach with the wrong person when you’re negotiating, right? Sometimes, and this comes across as a little bit manipulative, and so I own that, but I think sometimes that’s what we have to be is a little bit manipulative. And I think, by the way, at the end of the day, at the heart of communication, it’s all manipulation, particularly negotiation, it’s all manipulation.

I’m probably going to get some hateful comments that I said that, but I could be convinced otherwise. I invite anyone to challenge me on that, but that’s how I feel about it. So it’s a little bit manipulative, but I might need to channel and embody a completely different persona to get the outcome that I want based on who I’m talking to. So sometimes the best strategy is for me to bring my trial lawyer bulldog persona and I’m pounding my fist on the table and I’m demanding things. And maybe that’s going to be the best way to get my desired outcome. But sometimes I might need to lean into

Rishi Srivastava (38:31)
Thank

Megan Shapiro (38:36)
to

the stereotype, which is hard for me by the way, because that is not my natural default, right? To lean into the sort of like, my gosh, I’m just a helpless little lady and I just really need you, sir, to teach me how to do it. But sometimes that’s gonna get me the best result. And at the end of the day, I’m outcome oriented.

care what I have to do within limits. shouldn’t have even said I don’t care what I have to do to get there. Within limits. But I am outcome oriented. And so I will do within reasonable bounds what it takes to get my outcome. And if that means that I have to channel the passive, introvert, inexperienced, shy young girl to get what I want, then I’m going to do it. And I’m going to teach other women to do it too. And I’m unapologetic about that. Because you’re kidding yourself if you think that

are not doing the same thing.

Rishi Srivastava (39:27)
Yeah. One thing I want to say, you’re a very likable person. So how can people be more likable? Let me ask you that question.

Megan Shapiro (39:34)
Whoa!

of all, thank you for saying that. Second of all, that is not a widely shared belief, right? It’s not. I very much have, I’ve been told my entire life, I have a personality that is very much, you either love me or you absolutely hate me. Yeah. So you apparently happen to fall into the bucket of you actually like my personality, but there are just as many people who absolutely hate me. And I think having that dynamic and having been around that my entire life since I was a little girl,

coming up in the Midwest, by the way, in the Bible Belt of all places, where it is very much, sit pretty little lady, be seen, not heard. I think it really has shaped how I approach these things, right? I think that that’s one of my unique voices that I bring to my approach to this situation. But to get to the point of how you can be more likable, I’m a big, this is gonna sound like I’m completely doing a 180 from what I just said about embrace manipulation if you’re outcome oriented.

Having said that, I think the best way to be likable is to be authentic.

I think the reason why those who do like me like me is because at the end of the day, regardless of what voice I am embodying to get the outcome that I desire, at the end of the day, what you see is what you get with me. I am who I am. The way that I am right now with you, Rishi, is exactly how I engage with my husband. It’s exactly how I engage with my clients. It’s exactly how I engage with my friends. It’s exactly how I engage with my parents. Any given day, I am who I am. This is what you get. And so I think that resonates

people, right? People want, I think people are drawn to and attracted to people who are authentic. And so the people who like who I am authentically gravitate towards me. And the people who don’t like who I am authentically, those people that are like, that I really do not like this woman, that’s okay with me because I can’t change who I am. I don’t want to change who I am. And so let’s identify that quickly and let’s not waste each other’s time. We don’t need to be in each other’s space. We don’t all have to like everybody that we encounter and that’s fine. I’d rather spend my time and energy with the people who are drawn to me because usually

I’m drawn to them too, right? That’s usually that energetic exchange is almost always mutual. And so I’d rather have that. I want to spend my limited time and resources on the people that want to be around me that I want to be around as well. And so I think the best way to be quote unquote more likeable is to just stand in your authenticity. Be who you are. Be unapologetically who you are and be accepting of the fact that that’s going to repel the people that are not for you. And I want to just give a caveat to any younger women who might be listening.

I say that so easily, right? I’m just like, just do that, right? Like I act like it’s just the easiest thing to do.

It’s not easy to do that. It’s not easy to come to a place of acceptance. I fully acknowledge that wherever you are on your journey. It took me a very long time to accept that. I spent all of my twenties and half of my thirties wanting to be liked by everybody and trying to figure out how I could be the person that was universally liked by everybody, that appealed equally to everyone because I was so traumatized by all of those people saying, I really don’t like her. really, you love Megan or you hate Megan. And I hate Megan. I was so traumatized by that.

that I just wanted to figure out the secret code to being the girl that could be universally liked by everybody. And it took me until my late 30s to get comfortable with the idea that I really didn’t want that. That it’s okay to be who I am and to acknowledge and accept that that’s gonna push some people away and to be okay with that. So I just wanna make sure that I say that because I don’t know who’s listening and I don’t want the 25 year old who’s new to some male dominated industry to hear me

say that and think like, wow, she says that like it’s so easy and to feel then added pressure like she’s once again failing in some way because I was you and it’s hard and don’t feel like you have to be able to do it overnight but just know that that should be your destination. That is how you become more likeable is just by accepting who you are and accepting that you’re not going to be for everybody.

Rishi Srivastava (43:26)
I love it. The last section, Megan, here is on women, coaching, and leadership. When coaching women in construction, what habits do you often help them unlearn? And what new communication skills make the biggest impact on their leadership presence?

Megan Shapiro (43:45)
So I think kind of the rant I just went on is kind of what I help them unlearn, right? I help them unlearn all of these societal pressures and expectations on women in the workforce hard stop period, but then the added pressures that go into women in male dominated industries, right? Like we as women in male dominated industry spent so long historically trying to be one of the boys, right? Trying to be one of the guys, trying to fit in, trying to just be like the men are, show up like the men show up thinking that that

was going to be our path to acceptance. And I think that was not to criticize our trailblazing women who forged that path. We needed them to get to where we are. But I think now, as we sit in 2025, I think that that’s not necessarily the best approach, which goes back to my idea of showing up authentically. And so that’s the biggest thing that I have to kind of help women unlearn.

The biggest skill that I try to teach them is that idea of confidence through practice. And so the main number one way that I do this outside of the one-on-one coaching context is my workshop on difficult conversations. And we do a lot of role play and a lot of practice. We just equally we do that in my mastermind that’s for women in male dominated industries. We spend a lot of our time in our mastermind container.

practicing, working through it, the same conversations over and over and over again because practice really does make perfect and it takes that repetition to unwind the years and years and years of messaging so that we can show up authentically from an outcome-oriented place.

Rishi Srivastava (45:12)
There’s often a tension between being assertive and being perceived as too direct. How do you guide women to navigate that balance in negotiations or boardroom discussions?

Megan Shapiro (45:27)
that role play. So my role play implements another one of my frameworks. I call it the Four Natural Voices framework and it involves sort of like mentally switching hats in the middle of a difficult conversation. And so it really helps women get comfortable with that idea of embodying the persona or the voice that is going to be best received by the person that they’re talking to to get to allow them to get to their desired outcome. And so it’s not necessarily

I’m not trying to fight the good fight of debunking the myth that assertive women are not aggressive, right? Like I’m never going to be able to do that. The woman who figures out how to change the world’s perspective that assertive women are too direct or are bitchy, like she’s going to be a bazillionaire. I don’t know that trick. I don’t know the key. I’m not going to waste my time on that. I don’t know that it’s possible. I would rather spend my time helping individual women with their individual situations figure out how to set aside that bias

and allow them to then utilize the tools that they have at their disposal through practice, through role play, through frameworks, to still get the outcome that they desire without feeling that pressure of debunking this idea that assertive women are too direct.

Rishi Srivastava (46:36)
Very interesting. The last question here, Megan, is you built your consulting and converge construction summit alongside your full-time legal practice. How do you balance it all? And what advice would you give other professionals trying to lead multiple ventures with purpose?

Megan Shapiro (46:55)
You know, I actually get this question a lot and I still don’t have a good answer for how I balance it all. The best I can come up with is we make time for the things that are important to us. We find a way, right? Like the things that matter to us, we make time for them, whether that’s people, whether that’s hobbies, like it doesn’t matter what it is, if we care about it, we prioritize it, we just make it work. And so that’s really the best answer that I It’s not a great answer. I admit that’s not a great answer. That’s the best answer I have though. It’s not easy. I mean, I do my…

share of logging back in after I put my son to bed. I do my fair share of mommies working for a couple of hours on Saturday morning or Sunday evening. I do my fair share of that. You could argue that I don’t have good balance, that I don’t have good boundaries.

My retort to that would be, I would argue that I’m taking a good opportunity to show my six-year-old son that women have jobs too, that we are important, and instilling in him a good work ethic. Even though I live in California, as I said earlier, was raised in Missouri, I very much have a Midwestern work ethic. And I think that it’s an important lesson for my son that…

Hard work is important and working hard allows us to do all of the fun things, right? Like well if mommy doesn’t work, then we don’t get to go see Blippi live. If mommy doesn’t work, we can’t go to a movie at the movie theater every weekend. And I’m not working all the time, right? I mean I show up for him, I go to all of his events, I do all the things, but there are times where I need a little bit of alone time outside of normal quote unquote working hours out of a nine to five. But I embrace that.

Because again, I think that there are valuable lessons that I’m teaching or that I’d like to think that I’m teaching him there. I guess check back with me in 20 years. We’ll see how he feels at 26. If he had a mom who wasn’t present enough, guess his therapist will have to report back to us. But that’s sort of how I do it. I’m not saying that that’s the best strategy for everybody. And I’m not in any way criticizing women who make different choices than that at all. Equally, I would hope that they would not criticize my choice. We all do the best that we can. And so I guess my best advice for

for others who are trying to do multiple things with purpose is prioritize the things that matter to you and let the rest go because you can’t do it all. I know we’ve been told we were told from the 80s up into the early 2000s that women can do it all. We can’t. We can’t do it all. And so what we can do is get comfortable saying no and get comfortable prioritizing the things that actually matter. And if we do that, then we can find time for the things that we really want to do.

Rishi Srivastava (49:23)
That’s such a good answer. So I’m reading this book called 4000 weeks. It says that if we start doing more and more stuff, more and more stuff comes to us. You know, I clear all my emails this morning as soon as I wake up. There’s going to be more emails to attend like in an hour, the same amount.

Megan Shapiro (49:38)
Yep.

Absolutely.

Rishi Srivastava (49:43)
Megan, fantastic conversation with you. It was great having you on the show.

Megan Shapiro (49:48)
Thank you so much. was a good chat. I appreciate you having me on.