As an NFL veteran entering his eighth season in the league, Richard Sherman knows the ins and outs of a solid contract.
In 2014, he signed a four-year deal with the Seattle Seahawks worth $57.4 million, which at the time made him the highest paid cornerback in the NFL. Now, as a newly-signed player for the San Francisco 49ers, Sherman explains why he went to the negotiating table without representation to work out a three-year, $39.15 million deal.
“One of the main reasons I had decided to represent myself in negotiations was because I knew it would be a big challenge, and I never shy away from a challenge,” he writes for The Players’ Tribune. “But also, I wanted to be represented by somebody who was going to look out for my best interest and nothing else. So I thought, ‘Who better than me?'”
In November Sherman suffered a torn Achilles tendon that ended his season prematurely. He was released by the Seahawks on March 9. That same day, the star cornerback says he received a call from the 49ers to discuss a deal.
After making up his mind that he was going to negotiate his next contract without an agent, Sherman says he did his own homework to ensure that he’d agree to the best deal possible.
“I downloaded past contracts from the [National Football League Players Association] database and, with the union’s help, spent a lot of time studying the language and structure and nuances within contracts,” he wrote. “And when all was said and done, and the 49ers and I had agreed to terms, there were a lot of things I got out of the deal that I wanted.”
In his previous contract with the Seahawks, he’d had no guaranteed money for the 2018 season. In his newly-signed deal, he’s guaranteed a $3 million signing bonus up front. He will also receive an additional $2 million bonus if he passes his physical before November 11, which is the last day a team can pull a player off the Active/Physically Unable to Perform (PUP) list.
In total, Sherman says he can earn up to $13 million in 2018.
And, like any smart employee does when they receive a new job offer, Sherman reached out to the Seahawks’ general manager to see if they were interested in re-entering negotiations.
“When [general manager] John Schneider told me that Seattle was going to release me, he asked me to bring any contract offer I got from another team back to him so that the Seahawks could have an opportunity to match it,” Sherman writes. “I told him I would. So when the 49ers and I struck a deal, I immediately stepped out of the room and called John.”
In the end, the Seahawks refused to match the deal and Sherman moved forward with the 49ers.
Sherman’s negotiating success underlines a powerful lesson about the importance of knowing the value you bring to the table. Prior to his injury, he had never missed a game in his NFL career and he says that once he’s fully recovered he plans to show the 49ers that same dedication. In addition to his signing bonus, he negotiated a deal that will also pay him more money depending on how many games he plays and if he makes the Pro Bowl or All-Pro team.
His understanding of finances and how to negotiate money can be credited to Robert T. Kiyosaki’s book “Rich Dad Poor Dad,” which he read in high school.
“The very first book I read that really opened my mind to the way money works in general was ‘Rich Dad Poor Dad,'” Sherman told CNBC Make It. “We didn’t have a lot of money, we didn’t have a lot going for us at all, and that really opened my mind to what you could really do with money.”