In just two years, Ben Tossell (@bentossell) grew Makerpad to over 10,000 users, $400,000 ARR and got bought by Zapier in a deal that became Zapier’s first acquisition. In this episode, I’m going to put Ben’s poker face to the test as I dig into the details of the deal and what it’s like for a founder to go through that process for the first time.
• Learn about no-code: https://www.makerpad.co/
• Follow Ben on Twitter: https://twitter.com/@bentossell
What's up, everybody? This is Courtland from indiehackers.com and you're listening to the Indie Hackers Podcast. More people than ever are building cool stuff online and making a lot of money in the process. On this show, I sit down with these indie hackers to discuss the ideas, the opportunities, and the strategies they're taking advantage of so the rest of us can do the same.
Makerpad, for people who don't know, is really the best place to learn how to build apps and websites without code. If you have no idea how to code, you could go to Makerpad, and I don't know how long it would take you to learn, but you would eventually be able to build something like your own Airbnb clone without knowing anything about how to code. Is that right?
Yeah. That's one way to put it. Yeah, you could do it in minutes. You can learn how to do something, a quick automation to save you hours of work or building website, build an Airbnb clone, build an app, that sort of stuff.
Which is obviously world-changing, because I don't know how many people in my life who've been like Courtland, if only you will build me this app, I can achieve this vision or make so much money, et cetera. I'm like, sorry, it’s going to cost a lot of money in my. I can’t do it for free. But now those people don't have to bug me. They can just get on Makerpad and learn how to do it on their own.
I think when I talked to you were running Makerpad six months or something, solo founder, and you'd already done like a hundred thousand dollars in revenue and your expenses were nothing. It was like 5% expenses or something and so it was like 95% profit. You were a super happy dude and you hadn't even quit your job yet. You're like, I'm still waiting to quit my job. I think you quit maybe a month or two after the podcast.
Now, less than two years later, maybe a year and a half later. You are at a $400,000 revenue run rate, you've got multiple employees, and you just recently announced that your company was bought by Zapier, which is kind of the premier no-code tool that people use to automate tasks and connect different apps between each other on the web. Congratulations. That's a lot of progress and very little time.
Yeah. Yeah. It's been a bit of a roller coaster. I don't think it feels like that at the time. It doesn't feel like, oh, this is all going really quick, but yeah, when you look back on it, it was like 18 months of me actually going fulltime. We've been acquired and couldn't be more excited with the outcome, really.
I think it's huge. Obviously, we'll get into all the whys and the details and stuff, but it's just a credit to the movement in general has been growing and growing. We've been lucky that we sort of been at the forefront of that community.
There's something about being the entry-level option. Paul Graham wrote a good blog post recently and talking about kind of different things that he's learned from things that he worked on. He said, there's this idea that the low end eats the high end and that it's good to be an entry level option, even though that's less prestigious than being the high-end option. Because if you're not the entry-level option, somebody else will be, and they will eventually squash you against the ceiling. Which means that you should be kind of like wary about prestige.
When I think about Makerpad, you're the entry-level option. Someone knows zero about no-code, if they know nothing, they're going to go to you. That means you have a lot of power because that's where the most people are and you can kind of sort of direct them. You can say, hey, you should go use Zapier. You should go use Airtable. It makes a lot of sense for a company like Zapier to want to own Makerpad, because they want to be the entry-level option. They want to be able to direct brand new people to where they want to go. Ideally it is Zapier.
It's kind of cool strategically to look at how that's worked for you. Paul Graham said that was kind of the biggest lesson that he learned that helped him start Y Combinator and Viaweb, his company before that. Y Combinator is the entry-level option for startup founders. Yeah, Sequoia and Andreessen Horowitz might be more prestigious, but at the end of the day, if YC dis-invited them from demo day or something, it will be kind of crappy for them because they wouldn't be able to take a look at all these really, really cool early-stage companies. In a lot of ways, you’re like the YC for no-code.
So when I was doing Makerpad, it was like, oh, just finding out about these tools and just figuring out what you could do, like pushing it to an Airbnb clone or whatever. Then I sort of made the mistake of thinking that everyone was learning at the pace that I was learning stuff. So, if I'd find out something new about Webflow and Airtable together, I would teach that and put that video out.
Then it was really clear that like, oh wait, there's more and more people coming into the no-code space at level zero. They don't know what you're talking about with multi-level CMS items and referencing things like Airtable. and things like that. It's just like, what do I need to get my foot in the door? What's my first step. How do I first do that bit?
So I pinged Wade, the CEO of Zapier. Is he your boss now? Do you report to him? Are there intermediaries between the two of you now? How does that work?
He's my boss. Yeah. I mean, he's the CEO. I'm not sure what I would call myself now, but I run Makerpad still. Makerpad is staying independent, staying its own company within Zapier. Essentially, Makerpad’s a Zapier company, much like I think you guys are right, Indie Hackers, a Stripe company.
Very similar to me.
I get a masters class of how to be a CEO from Wade, who's raised hardly any money. Gone from the YC to a $5 billion company, 400 employees all completely remote. I couldn't think of a better person to be holding my hand through how to run a company.
Yeah. It's pretty amazing. Your situation is, it's hard for me to think of somebody who has a more similar situation to what I have at Stripe. I ran Indie Hackers for what, nine months, eight months got acquired by Stripe, talked to Patrick, the CEO, just a whole bunch. I had the exact same thoughts, like, oh, cool. I get to learn from Patrick Collison, he's running this really amazing company. There are no intermediaries between us, but I'm super independent. Stripe’s not telling me what to do. It's like you’re the exact same situation.
I have a bunch of questions for you based on my experience. First of all, does it feel weird to have a boss, having not had a boss for the last year and a half, two years? What is that like for you?
I'm not sitting with Wade behind me and thinking, oh, that's my boss. I'd better be making myself a busy-type chap. I semi-know what I'm doing and where I'm heading with Makerpad and the team.
It's just sort of like having a mentor that, if you had a really close investor friend who was invested in you and had done it all before and done it really well before. You can just sort of ask them, hey, does this seem like to you, what would you do in this situation on paper?
On paper I feel like I have a boss. In reality I feel the same way as you. I don't have a boss. I'm kind of doing all the same things I was doing before I joined Stripe. No one's really telling me what to do.
Somebody on Indie Hackers the other day asked how come Indie Hackers doesn't have like a Gumroad revenue option? Then someone else is like, it's because they're owned by Stripe. That's why they only have Stripe. I had to comment and be no, no one at Stripe actually has ever told me to build anything for the website. It's a hundred percent me just doing whatever I want.
There's a lot of trust there. It doesn't feel like you have a boss. I think you used the word investor. That's kind of what it feels like to me. It feels like Stripe has invested in Indie Hackers and it feels like Zapier is invested in Makerpad, which is a whole different kind of relationship where now I feel like this pressure to do right by my investors. I don't want to let them down. I don't want to make them feel like it wasn't a good acquisition.
Is that the same thing as having a boss? I don't know. I've literally never had a boss before, but I definitely feel some amount of pressure and I don't know how things are set up with you at Zapier. Maybe you have milestones you want to hit, or maybe you have goals you want to reach. I assume they didn't just buy Makerpad and say, keep doing you. Let's not talk about it.
I would assume that, if you're in my situation, there might come someday where you're like, you know what, I do feel a lot of pressure externally to hit these goals that maybe you wouldn't, you know, maybe on your own you'd feel like you have completely different goals and it'd be easier to breathe easier because there's really nobody to disappoint beside yourself.
It was the complete opposite for me. I felt when I was just running Makerpad before it was you at the helm of everyone else. There's people relying on you, there's customers and relying on you, there's partners relying on you. I'm relying on myself. The no-code movement, everyone else is sort of relying on me to do well with Makerpad and make the right decisions and do the right things.
There's just so many decisions to make as running a company. I keep on saying to a few people who've asked, I don't think I'm delirious. I didn’t just start with it in general or a startup Twitter is like, oh yeah, I'm going to start a company and one day it will be like a public company. I'm like, do you have any idea how different a company is it, like so many different ages?
When it's just you, great. That's fine. It's just you hacking away and it's a side project you got to try and get to work. There's plenty of those people on Indie Hackers. Then when you get to your first employee, it's sort of like two friends hacking away at something. Then you get to five employees, you're like, holy shit, this is a team. Then you're 10 people you think, wait, what the fuck am I doing? I’ve got to have team meetings and one-on-ones with people.
There must be such a small percentage of people who have the skills to either learn or just have that in them to start the company from zero and then grow it all the way up to, all the way through those buckets of teams, 10 people, a hundred people, a thousand people, 10 million revenue, a hundred million in revenue.
It seems like an impossible task, unless you're a very small amount of people. I think fair enough that lots of people have that dream or have that drive to get there. But I think when, if you look at what you want to do and how you want to do it, I think it does take some looking at yourself to say, am I the one person to do that? Because I think it's okay that not everyone is.
I think for me, I was like for Makerpad to be what it could be I'm going to need some help here. Not necessarily just help from we need an amazing team. It's we need someone or something that has done this before. I don't want to necessarily go and ask for VC money, pretend I'm trying to build a billion-dollar company and that I'm the person to do that. What I need is like a long-term partner that's going to help guide me through some of these steps and let me screw up a couple of times and guide us through the good stuff, too.
So yeah, when this sort of happened with, chatting to Wade and exploring this as potential, I was just like, this seems like the exact perfect thing that I was looking for.
In a lot of ways, you felt like you had the weight of the world on your shoulders because you're in this sort of very important position at the core of the no-code movement. You see all these crazy, ridiculous outcomes and lots of people with the Steve Jobs complex or they think it's going to be so easy and they're the chosen one. It turns out you feel much more comfortable in a situation where you're actually working with somebody who has done that to be able to get to that goal.
I think about this a lot, actually. If we were living like primitive humans lived in a small tribe, you might be impressed by other people who are really good at thatching roofs or really good at making a spear, or cooking or whatever. There's not that many people. It's like a hundred people or something to be impressed by and you're probably going to be pretty good at something.
But now we live in this crazy connected society where everybody's on Twitter. Everybody can search Google, anybody can watch TV. The most impressive people are not one in a hundred now. They're like one in 7 billion and it's really hard not to compare yourself to that. Tt's also really hard to even fathom how good that person must be to be good enough to get on your radar. It's really easy to I think misjudge and say, I need to be as good as people, not really realizing how crazy of a task that is. It's also really easy to just feel like shit all the time because you're comparing yourself to people who you really shouldn't compare yourself to you. So, I think it's very wise for you to want a mentor.
Makerpad is just semi-independent we had some investors, but it was like, we've got to make this work for them and for the no-code movement and all this sort of stuff. You can take that weight on, but no one's really applying that pressure other than yourself. It's probably more of an ego thing of like, oh, I fucked it up. I had something going, it was sort of working in these ways and not these ways. That was done to me that I messed that up. We're always experimenting. It was just constant experimentation the whole time.
I mean, I'll tell you my perspective, which is that no one's done this before. No one has ever built the premier no-code community that's going to usher us into the future. There's no one who knows what the answer is and people who've done it before in other arenas… I've talked to some very impressive, very successful people and asked what would you do with Indie Hackers? They're throwing out the same ideas as literally everybody else.
I'll keep tabs on what happens with Makerpad, but it'll be super interesting to see how joining Zapier helps, because I truly don't believe anybody has the answers. You're not doing like, oh, I'm going to do a B2B SaaS company where there's a giant playbook and a thousand people who've done this before.
You're pioneering a completely new space that, quite frankly, no one can even say what it's going to look like in five or 10 years from now. It's impossible to predict, but I'm sure you have some sort of vision.
I'm just curious, let's say you do do everything right. What do you hope Makerpad is? What does Zapier hope that Makerpad is if they buy your company assuming they're really investors, they're not buying you for where you are today. They're buying you for what you can become. What's the grand vision?
The thing that Wade and I both definitely aligned ourselves on was we hope that no-code is not a thing in five years. I hope that no-code just sort of fits in the democratization of software development. It is the thing I think that democratizes it to the point of we don't have to talk about code versus no-code anymore. We talk about software development as a whole, no-code only that first rung on the ladder and writing actual code is probably the very top end, the more specialist, highly skilled stuff.
Zapier is more democratization of automation and we are democratization of software development and there's a huge overlap if not completely overlap with those things. How I'm in this position is because I chose to not listen to anyone when they said learn to code or find a technical co-founder. I just was not willing to say, okay, yeah, that's what I'll do. I did just the complete opposite when everyone was like, you're doing it wrong. This is not the way you supposed to do stuff.
The no-code piece for me has just allowed me to start a company, build a company, sell a company all while pushing the same thing that empowered me to do that in the first place. I'm not going to ever stop beating this drum I think.
I’ve talked to a lot of people who have like the same. I don't know if you can call it a contrarian streak where they're just going against the grain intentionally, but it's more like they don't even care what the grain is.
Tobias van Schneider, one of the lead designers at Spotify for a long time, just a brilliant designer and now indie hacker and founder. He would make all these apps that were just like, ugh, I hate what the design community is doing. He you made this cool weather app where everybody was making these beautifully designed weather apps. He just made a super under designed really basic, just nothing but text weather app. It would say things like it's fucking raining, would just tell it straight like it is and wouldn't be fancy. He made like a million to $2 from this weather app, just cause he went against the grain.
Makerpad, learn to build things without code when everybody's saying we should all learn how to code and Indie Hackers, learn how to build a startup without raising money when everyone's saying you need to raise money, et cetera. There's a huge payoff in taking these contrarian bets, but also it's so risky cause you just don't hear about all the tens of thousands of stories of people who bet wrong.
Sometimes you're right. Sometimes you're wrong. I tried to do, I called it the App Store for bots when Facebook bots were really hot and they were just coming out. I started with Mubs and Seth, two other indie hackers, basically that was BotList. I was like, oh, this is going to be huge. It's going to be massive. It's going to be this, that and the other…
Who gives a fuck about bots these days, but really it's not like….
It just didn't work out.
Yeah. It's just like, okay, fine. We'll mark that one down as a loss, but you just got to keep going. I hate listening to podcasts where people are like, oh, it just sort of happened to be the thing I was interested in and then it worked out in the end and all of that stuff. Then it sort of happens for you and then you say the exact same thing and you'll do this and you hate it.
So I read an article on Business Insider about Zapier buying Makerpad. It claimed that basically you tweeted about different apps and products that are like the most popular on Makerpad. Airtable and Zapier are at the top and there were a whole bunch of below them. Then somebody else tweeted and they're basically like Airtable or Zapier it needs to buy Makerpad quick. They're fucking up. They need to actually acquire this company. And Wade from Zapier saw that tweet and then called you because apparently he's just like trolling Twitter to find companies to buy. Is that true? Is that how he actually got in contact with you?
That is actually mostly true. Walter Chen said, oh yeah. He tagged Airtable and Zapier and said you need to buy Makerpad ASAP. Then Wade emailed me a link to that tweet. I mean, I replied to the tweet saying, oh, it'd be like picking between your parents, as a joke. Then Wade pinged me that tweet and said, did you see this tweet? He's not wrong. Let's have a chat. We had a chat and here we are six, seven months later.
Do you know what was going through Wade's head at that time, because I assume he didn't just then consider, we should buy Makerpad. I assume they've had conversations internally at Zapier because of it and they had their own process for it because you're literally the very first acquisition. That's not something you do lightly.
I met Wade in person in the No-code Conf in San Francisco, November 2019, it must've been. We had dinner with a few of the people, just got on and talked about a no-code stuff then, and then sort of kept in touch. Zapier were a partner of Makerpad’s, so there was a relationship there. Wade and I've spoken, follow each other on Twitter, that sort of stuff.
I've also spoken to Mike, one of the other co-founders cause he's a product person who builds a bunch of stuff and experiments and I've tested things with them. So, I knew some of the people at Zapier. From what I understand, Wade has being just eyeing up Makerpad for a while and seeing how it's been growing and seeing the community grow and the whole no-code movement grow and things like that.
Maybe it's just a tweet to sort of say, oh yeah, let's kick this into an actual conversation. So, I'm forever grateful for Walter and Twitter.
It's pretty cool. I'm sure you've seen the tweets about this trend right now of basically really big tech companies who are now trying to own media companies. If you look at the long story of the internet, it has been 30 years of people figuring out new and more efficient ways to go directly to readers, directly to consumers without having to be knock on the door of some gatekeeper and ask, hey, will you publish our story?
Because in like 1990, if you wanted to get a story out to lots of people, you had to go find a reporter for Fox News and the New York Times or whoever and they would basically say, we're not going to publish a story or we're only gonna publish it this way, et cetera. You had to do PR.
Whereas in 2021, you have Elon Musk firing the PR team at Tesla because he can just tweet whatever he wants. Then you have lots of these acquisitions where Stripe buys Indie Hackers. HubSpot bought The Hustle recently. Business insider bought majority stake in Morning Brew, this huge newsletter.
Now you have Makerpad, which in many ways it's kind of a media company. I mean, you reach lots and lots of people with a really cool message and educational content. And you have Zapier, which is this big SaaS company. Yeah, they've got a blog, but a blog doesn't have the same credibility as an independent media company kike you have. They could publish stuff on Zapier's blog and it's really good and really well written, but it's kind of tainted because it's owned by and written by Zapier, a huge bias there.
Whereas if they buy you and they leave you alone and you're sort of run independently, you can basically make moves and kind of shift the industry and people trust you and they don't really lose their trust in you. People don't even know Indie Hackers is owned by Stripe because Stripe just doesn't touch it. We don't have a ton of Stripe branding everywhere.
I'm curious how you think about this? What do you think about the sort of movement for companies owning media companies and how does it feel to potentially be one of those media companies that is now owned?
We fall into that bucket, definitely. I don't know if we're a media company, we call ourselves a learning community. I think it makes sense in these SaaS companies buying communities. I think that feels like that sort of gets the whole bracket of Morning Brew, Trends, or The Hustle. I think we put out content that has a community that congregate around it.
If that's called a media company or community, then there's two sides of it. There's the product teams who get the product right and build a really good product and know how to do product stuff. Then they use community incentives and community things around it to help that product grow.
That would be Zapier and they have amazing content that drives people to go and eventually use Zapier. The other side of it, where we all sort of play, is we're just focused around the content and the community experience of how people feel and what they're experiencing. If that happens to point them to a product, not one that we're affiliated with or care which one, that's sort of a win, it's just helping them figure out the product for them or what they need to do.
The alignment there is completely different anyway. There's ways that they can be paired up together and work amazingly. I think Zapier is probably our most used tool on all of our tutorials and stuff, just because it is the product that glues other products together. As long as there is a true beneficial way that both can work like that and work independently and not be, oh, we're a Zapier company now all you got to use is Zapier. That's the only tool to use.
Use whatever tools you want. We're not going to get involved in any of that stuff. And I think part of the point that with Makerpad is we're not just teaching one stack of tools every time, because that's not fair or right. I think that that would just tarnish it straight away and it wouldn't work out the way I thought it would have.
So you're making $400 grand a year in revenue from Makerpad before Zapier required you and you are also profitable. I have to imagine that Zapier just doesn't care about your revenue. Because this is kind of what happened to Indie Hackers where it's like, well, Stripe makes so much money that the amount of money that I make for Indie Hackers will literally never amount to anything. I might as well just completely stop doing this. The only thing that I can do that’s of value, which just make the community bigger and better and reach more people. Is it the same thing for you right now?
I don't think it's the same necessarily. I think there's, with our business model, obviously I've been upfront with you and anyone else, there's a few ways to monetize this type of community. But which one feels right and which one aligns with what we want to do in the future?
We want to reach as many people as possible about no-code and teaching them that stuff. How does that align with how we make money? Does that feel right? I think with the Zapier acquisition, there's not a rush to hit revenue goals now.
It doesn't need to be next month needs to be $50K, then after that needs to be 10% more and things like that. I think it's just let's figure out how we can make this community as big as possible whilst having the same outcomes for the community. We want make Makerpad to have its own revenue stream, have its own team that takes care of itself. But I mean, yeah, Zapier having a hundred plus million ARR…
I know, right? Are you going to ever be able to touch that? Why make money at all? Why not just say screw it, let's just be as big as possible?
That'd be both those things. I don't think, what we did at Makerpad before, or what I chose to do, I guess, is stunt our growth because we had to make money.
Whereas in this scenario, it's not that way around. It's let's grow as big as we can and figure out the right way to, to make money in that scenario rather than, okay you've got to hit revenue goals first and foremost and that's the important piece.
If you've got a team of five now and we want to get to a team of 10, all of that cost could be swallowed up into Zapier, but I think it's more beneficial for us to feel like we sort of take care of ourselves. We're this independent company as part of Zapier, we take care of ourselves. We do well, and we're growing and we're still reaching that many people and all that. I would like to do that as the person running Makerpad. That's what I'm going to figure out, too.
Do you know very much about a Free Code Camp? It's run by this guy, Quincy Larson. I was talking to him a couple of weeks ago. I was like, how are you so big? How are you reaching so many people? There's obviously a large movement to learn how to code. There's a large movement to learn how to be an indie hacker and a large movement to learn how to no-code.
They've got, I think 4 million email subscribers. That's a bigger email list than almost anybody than I know. Even these other media companies, like The Hustle and Morning Brew combined, I don't know if they have 4 million email subscribers. Plus, they get over a million people a week from SEO. They’ve got a forum, they're getting 2 million visits a month, but just crazy numbers.
I was kinda picking Quincy's brain about how he's doing this. A big part of it was just being free. The fact that he's offering something that people are so used to paying for but providing it for $0. The whole site's a nonprofit, it's funded by donations. You can go and learn how to code and have this cool, bright future in front of you and you don’t have to pay anything. It was pretty cool. So, it's hard for me to look at that and not be like, hmm, this seems like a model that you could use.
Although no-code is just so much more nascent. There's so many people who already understand the benefits of code. You have this kind of dual responsibility to not only teach people how to build stuff without code but teach people that like you can do it and here's why it's valuable. Here's what you can do if you learn these skills, it's like a whole other level of responsibility.
I think that’s part of this whole let's get rid of the no-code piece or that's why I've disagreed with maybe how the term has come about, because it's, if my mum is searching how to build the website, she's not typing with code or without code. She’s just typing how do I build a website?
What you want to have there is the first thing is use Carrd or next level up maybe use Webflow. Then the next level up from that might be learn HTML and then CSS. I think that should be your path.
So, it's how do we get that across well, and there's loads of things we need to improve at Makerpad of like, the first thing on the homepage is learn how to build software, to develop software. I know that there's going to be a ton of people going, what? That's not what I'm after, but I don't know. I’ve struggled to figure out what that thing is to get people in.
I think it should be as much free stuff as possible. We've got loads of blog content that's been coming out. Most of our content is free. So, it's just behind a wall to get people to sign up and maybe that'll go away and maybe they'll just be like, okay, you can just read this.
I think what we're looking at is how do we get double or triple that content on there, because you need to get that content in front of the people when they're searching that thing, which is one thing that Zapier does extremely well, is if you're searching for something in the tech world, you probably land on a Zapier blog post about that thing, or how to use that thing or whatever.
So, it's a case of, do we have our education structured in a good way? Are we getting in front of the people when they are weighing up these options of how do I build a website?
One of the things that happened when Stripe bought Indie Hackers was because it's a community site, a lot of people feel ownership of the community. Therefore, a lot of people had very strong opinions about how this should all go down. I'm sure it's the same with Makerpad.
One of the big things that people were worried about was is Indie Hackers going to be able to be independent? Another big thing that people wanted to know was just what are the numbers? You know, Cortland, you've always shared exactly how much revenue you're making. You've always shared where it's coming from. What's going on with this acquisition? Why is it all secret?
What’s the deal with your acquisition? Are you sharing the price for how much you got acquired for? Cause you've always been super transparent about revenue numbers.
I found this really odd actually, because Sam Parr did the same thing where he's always really open about numbers. He talks about, he always looks up people's numbers and talks about it. Then when his announcement came out, he said, oh, you all want to know the price? I'm not telling anyone that. I'm taking that to the grave type thing.
I think once you've gone through an acquisition, I don't know that there's anything beneficial to come out of it other than people going, oh cool. Now I know how much I could get my own thing for potentially in the future. I think that there should probably be some sort of like Glassdoor for acquisitions where, okay, this is a SaaS, big SaaS company buys community company and they went for this much.
But I think if you're in an acquisition and you goes through all the lawyer stuff, all the agreements and stuff, it's just part of the process. That's just part of it. So, it's difficult to then, if you're the one being acquired, to then say I really would love to tell everyone about this number. Can I do that? That's not your thing to do. It's usually part of the legal proceedings. It’s not that people don't want to share it, necessarily. I think it's probably the same with you, right?
Yeah, I would have shared if I could have, but it's also there's a second party there. Stripe’s going to make more acquisitions in the future. It's not like you're just sharing your own finances of your own business. You're sharing this transaction that happened with other people that they might not want you to share. So that's kind of, what's missing from the outside perspective. They might think that you're just being super mum and not sharing because you don't want to, but even if you wanted to share, you can't really.
Yeah, exactly. If you share the whole purpose of the acquisition, there's an autonomous relationship straight away then, you're in a long-term relationship with someone else now. Do you want that to start off on like oh, this guy can't keep his mouth shut? Or they've gone against the terms of the deal straight away.
I don't think you understand it until you go through an acquisition that like. It's not that easy to just say, can I just tell everyone the numbers?
There are some times where people share the numbers and it's completely fine. Usually those are for bigger deals or deals where people just don't care about the things that they're worried about. But if I think about the reasons why an acquirer might not want you to share, number one is because they have to do future negotiations and they don't want to sort of tip their hand as to what they're paying for companies.
Number two, this is kind of a potentially adversarial, but because they don't want you to get a bunch of advice from people on what you should have sold for, right. I assume you had a negotiation process, you had a whole thing. If you go around telling everybody I sold it for X and everyone's like, oh man, you should have sold it for two X. How are you going to feel? Probably not very good. Then you might go back to them and it's kinda like the deal is done. Move on. Everyone be happy.
There's two of the biggest reasons I think. And I'm sure there's more, but I'm curious about your negotiation process. Because with Stripe, I also had this deal that came in that I wasn't really expecting. I think it was maybe four or five days from the first contact that I had with Patrick to we have agreed to numbers and these are the numbers. Super, super whirlwind tour. I was just reading a lot about, how do you negotiate? Who says the first number of blah, blah, blah, blah, blah? There's not enough that I could have read, there's never going to be enough where it's like I'm a master at this compared to someone who does this for a living.
How did it look for you? Were you practicing? Or were you learning? Or were you just like, screw it. I got a number in mind. What was your process?
When Wade mentioned that, and then we sort of had a brief chat and said, oh, this is what we're thinking, acquiring you. We could do this sort of quite quickly, have a simple agreement, blah, blah, blah. We went away and then I think we scheduled call for a week later.
That week is the longest week of your life. I'm thinking what the number's going to be. It could be this number. Would I be happy with that? It could be this number it could be. Would I be happy with that? Really you’re just making up stuff and winding yourself up all week. There's no, no point there, but that was what I did. Then got on a call and Wade said a number. I was like, okay, cool. Then we went away and sort of did some thinking about it. I was really happy with what was offered. I was just like, that feels good, but there's just a process.
Luckily my best friend, I've known him since I was like two years old, he does this for a living. He’s an M&A advisor and does a bunch of that stuff. The whole process he was basically on call with me all the time. I was like, what do I do? Do I just say yeah, that sounds good? Do I say no, I want more? Do you start throwing out what you want in employment? Do you start saying stuff about your team? Do you start saying… when do you do what thing?
I was just learning as I went. There was a back and forth a bit of, depending on how you look at numbers, when you look at them, it could be higher, could be lower. You sort of just play that game. I think, I dunno if you felt like this, but I think everyone feels like, no my deal is different. It's not going to be complicated like everyone else's. It's going to be straightforward. Me and the acquiring CEO, we get on really well, so I'm sure that we're just like, there'll be a one-page document and we'll both sign it. It'll be fine and will be done in like a week and a half.
It's just not that at all. It's just the same thing for everyone. It takes months and things get in the way. Things change. Lawyers are telling you one thing, you read that as one thing, and then you speak to the other company and you're like, oh no, this is what we both thought it was.
It's a crazy game of telephone where it's like, you're talking to each other, you agree. You tell the lawyers, lawyers talk to each other and that's a completely different message that gets into the thing. That whole process just took two days and now you gotta go redo it. There's some other translation error. It's kind of comical.
It's the legalese. Everything's gotta be translated into the legal terms. Every time I'm just like, can you guys just explain this like I'm five years old? Explain to me exactly why this is an issue.
One of the few things I took away from this whole experience was remember to keep on having contact with the person who is on the other end. Wade and I having conversations really helped cause we were talking about what's going to happen after, what are the things we want to do? What’s the vision and what's that cool stuff.
I know lawyers are lawyers and they're speaking to each other. So, there's obviously back and forth. It might seem heated over there, but us on this side, we’re the ones still really excited and we've got to work together after this. So as long as you stay on that level, I think is just keeps reminding you like, oh yeah, this is just lawyers talking to lawyers. Don't need to worry about it so much.
And another thing was, if you're in that position, it's your company, you're an entrepreneur. You always think the best of something. You're thinking of the best-case scenario all of the time, because otherwise you wouldn't be an entrepreneur. But lawyers are thinking of what happens in the worst-case scenario in this deal.
So, for you to have someone who's trying to protect you and saying this could all go wrong in this way, this way, this way, this way, what happens in that case? Or how about that case? And I'm thinking, yeah, but it's all going to go fine. I'll be fine. Obviously, you hope that it will all be fine, but it's just one of those weird games or weird things in your head you've got to sort of draw a line and say, okay, I understand that I've got to consider these things because that's the lawyer's way of thinking, but I'm assuming the best, which is fine, but just remember that there's different parts of this.
There’s a lot of times where you see companies being just real assholes about stuff and what's really going on is that there's just lawyers at the company who were like, you must do things this way, or we might get sued.
It's the same thing if you're going through an acquisition. Your lawyers are just imagining the worst possible case scenario and painting this terrible picture. You're like, yeah, but there's no way Wade's going to take my company and then send an assassin to my house and shank me, that's not going to happen. But your lawyer is going to have a detail for every single thing.
At some point you just gotta draw the line and be like, I'm not worried about this. Let's just move forward. Otherwise, it can take forever. Your lawyer's incentives are to just not do that. Their incentive is to make sure you're extremely well-protected, that no one could ever say that they didn't do a good job with you. That also it takes as long as possible because they're charging by the hour. So, who cares?
Another thing that happened in my acquisition that still happens today, literally someone had a Twitter post about it earlier this week, is people will try to guess how much you get acquired for it cause you're not sharing. So, I'm going to do that even though I know you're not going to confirm, I just think it's fun to do so.
The first thing I think people don't realize about these deals is everybody thinks that there's just a single number. Oh, you know, you got acquired it's X, but in reality is it's usually more complex than that. Are you getting cash? Are you getting stock? If you're getting stock, is it going to vest over time? Does vest over four years, over two years, quarterly for the next three years. All these different numbers that matter. Then do you have milestones and metrics that you need to hit, et cetera, et cetera?
So, I would guess for Makerpad that, you raised funding last year, right? You've actually raised from some investors. So, you're not entirely bootstrapped. Probably, since it was a seed round raised at a one or $2 million valuation and probably to make you happy if Wade threw out a number and you felt good, it's probably somewhere around at least double that maybe triple that or something.
So, I would guess that you got acquired for somewhere between $3 to $6 million. Lots of it will probably be in Zapier stock, which I think is probably a good bet and that since they want you to get bigger, there might be some milestones attached to that, but maybe not. This is where you make a poker face and I see if I'm right.
We'll never know. What about if I guess your deal?
You could do the same thing if you want. But it is kind of cool to have Zapier stock. I mean, they just got like a $5 billion valuation, which is absolutely nuts. Cause they're like the indie hackerest of indie hacker companies. They raised a little bit of money a whole bunch of years ago and they just said screw you to investors, never raise any more money ever again. Then they finally just let some investors in and it's like, no, Zapier's not worth a few million dollars. Zapier is one of the premier unicorn companies in the world. It's pretty nuts. If I were you, I would probably take the stock.
Zapier is a phenomenal company and that's one of the conversations I've had with Wade and the other co-founders is just like, I just love that you do stuff weird. You do stuff that isn't in the playbook of Silicon Valley startup stuff. I’m the same. I do stuff weird. I like that we both do weird stuff.
Yeah. There was a thread on Hacker news where people were talking about this $5 billion Zapier valuation. And it's the typical Hacker News thread, people are saying, I don't understand why anyone would pay $5 billion for this, et cetera.
I have my own thoughts. I'm very bullish on Zapier. I think it's got what, 3,000 apps that are connected to it. It's got more integrations than almost anybody. That's a huge moat. It's very hard for anybody to catch up to that. It's not like build your entire app on Zapier. It's kind of like, we’ll help you connect stuff and do things in the background. It's kind of like the glue that holds apps together, which is really cool because it means that Zapier doesn't necessarily directly compete with things that let you build a website.
You can build all those other things and still use Zapier to make it so that when somebody adds a row to a Google sheet, then it sends an email to someone else, et cetera. There's really never a reason to stop using Zapier because you're using something else for the most part.
I think culturally, what you're saying about how they do things differently they've been a remote company since the beginning, I think. Everybody in 2020 was scrambling to figure out how to be remote and Zapier is living 10 years ahead of everybody and they're probably just flying. There's a lot to be bullish about.
I'm curious if, from your perspective, where do you see Zapier and the ecosystem and why do you think it's worth investing in?
Exactly that it's the glue that combines all the products together. One of those things at Makerpad’s that been hard to figure out is it's not necessarily a tool you could live without, like you rely on it. I rely on it every month.
So, for me, there's to runs Zapier, err, to run Makerpad, I don't run Zapier, to run Makerpad, there's my email marketing software. I need that. I need to use that every month. So, I'm going to pay for it. I'm going to continue paying for it until I don't know when, I don't see ever having to turn that off.
With Zapier, it's one of those things, they'll email you or they email me yesterday, one of our accounts that said this Zapier has saved you 28 hours in the last six months. Okay, am I going to now start doing that manually? Nope, probably never. So yeah, exactly. You keep on you keep coming on. I'll pay, I'll pay, whatever it is to save that time.
I think it's one of those things that once you have a couple of use cases for it, then it stays in your product. I think it shows that growth over the years of revenue and everything else. They've built a product that works really well in the SssS world of it's very, very sticky, putting all those tools together.
Everyone else is sort of trying to be the one tool that does it all. I just don't believe that there is ever going to be a one tool that does it all. I know there's many who try and I just, people like different things and different teams work in different tools. There's always going to be at any company, some version of a suite of tools. There's never going to just be, oh, this is the one tool we use for everything.
I just don't think that's true. When there's more and more tools coming out, Zapier’s just going to keep getting better, I think.
It's cool that we're living in a world, too, where there can be a ton of tools and those tools can be worth billions of dollars. If you go back to the internet, like 15 years ago, kind of the ethos was you've got to be the category winner. You've got to be number one in your space and number two has to be super far distant second. Otherwise, you're not even worth investing in or paying attention to you. That’s kind of the VC mindset.
Now it's like, well, there are a ton of task managers. Asana just went public and is worth billions. There are a ton of no-code tools and a ton of, just a lot of tools in every space that are thriving because the internet is so big right now. A lot of people can succeed if they have their own unique approach and I don't think that's going to stop.
I think we've got the creator economy and we've got more and more indie hackers coming online. In many ways, Africa and parts of South America and Southeast Asia sort of waking up and billions of people who previously weren't really engaging on the internet are going to start. It just seems like, I mean, it's crazy.
There was a report yesterday, I think that Stripe's got a new valuation of $95 billion. Stripe is worth more now than the entire internet economy was worth when Stripe started. Just to give you a sense of how fast and the internet is growing.
I'm super bullish on no-code. I feel almost no matter what path you take, you're going to capture some big part of it. Even if the term no-code goes away, people are still going to be doing this stuff and learning how to do this stuff. More and more people are going to want to make money online and make a living. I think you're in a kind of a sweet spot, dude.
How's your life going to change? I mean, you've been through kind of the entire indie hacker journey. You worked on a bunch of stuff that we talked about the first time you were on the podcast that didn't really work out and it failed. You relaunched it and changed things. Then you built something that worked and you've worked really hard on it for the last few years. And now you got acquired. Does this feel like the end of the road for you? Does it feel like the beginning? Does it feel like anything's going to change? Are you going to go out and make a big purchase? What's different for you?
Yeah. Again, it's one of those things that you listen to podcasts and expect someone to say, oh, my life changed overnight and it was like, this crazy thing happened. But I'm still sat in my little room, just doing the same stuff. There’ll be lifestyle changes that happen, you can buy a house and things like that, which is amazing.
Personally, I think I'm still just mostly the same. My girlfriend might want a few presents and stuff and the wedding can finally go ahead without worrying about it. Other than that..
You were talking to me about your wedding last March when we were in Mexico City and it's just been a year. Do you have a plan now? Do you have a date?
We have a fourth date.
A fourth date, geez.
I think there's something to be said for starting a company where it can make money and it can earn you your freedom and it can get you to the point where you don't have to have a boss and your life is comfortable, but beyond that, it has some cool effect on other people in the world.
You’re not just sitting down, making an app that can make you money, but you're making an app that's teaching people to develop skills to change their lives. When you have this cool liquidity event and where you sell your company and presumably you're rich now, you're not like, well, I'm going to quit because this sucks.
You're like, hey, I still have this cool thing that I'm really doing. You kind of get to the higher level of, Maslow's Hierarchy of Needs where you’re no longer worried about your freedom and you're no longer worried about your bills or anything. You have this cool mission that you you're excited to work on.
I’ve met a lot of people who have something where they've sold it, or it's gotten really big and suddenly they feel super lost cause it's like, I don't really want to work on this. It accomplished all the goals in my life that I wanted it to accomplish. I've got this money now, I'm done with it.
I think it's a pretty special to be in your position where you built something that has kind of the next level of goals built into it so you don't have to quit and try to go find out what you really want to do with your life, because you're kind of already doing it. Having already gotten to this point, what's your advice for indie hackers who are just starting out?
You just nailed that where this is the thing that I wanted to do.
I just made it the thing I wanted to do was build stuff with no-code and just have other people who like it. I just don't want to be one of those annoying people that says follow what you're interested in, but I don't know what else to say from my experience.
There's a few things that you’re going to be interested in. You’ve just going to sort of pull that thread and see where it takes you. It might take you absolutely nowhere, but that's actually part of the reps you've got to put in. Unfortunately, some of that stuff just doesn't work out and there'll be a reason for why it doesn't work out. You've just got to take that on and figure it out the next time.
But I think for me, it's just been, I've gone against what I was supposed to be, learning to code. Luckily enough people also figured that out and realize that's an option and the tools got better and the community got better. I'm bad at advice. I don't know that I've got it figured out.
I don't think anybody does, but I think that I've met a ton of people who've have done the same thing. Follow your passion, follow what you're genuinely interested in. Then also prepare for the fact that a lot of times it's not gonna work out and you shouldn't get super discouraged. You shouldn't quit. You should just keep going. That's what you did. I'm super happy to have you on the show for the third time. I wish everybody could come on the show for the third time and talk about their smashingly successful acquisition. Ben Tossell, thanks for coming back on.
Cheers. Thanks for having me.
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