A $100,000/year business can sell for $300,000 cash.

$300,000 cash invested at 7%, is $21,000/year return.

That's $79,000/year less than you were making before you sold. But less risky.

So selling your company isn't necessarily a reason to celebrate.

And if it wasn't your idea to sell:

Don't get so excited about someone wanting to buy (I know I did).

Getting acquired simply means converting your monthly cash FLOW into solid cash.

Cashflow is riskier than cash. But cashflow keeps paying. Cash has low return on investment.

This works because:

if you think you'll sell it, you generally stop focusing on improving the product, but you get money eyes 🤑
meanwhile most of the times they won't actually buy it

Now you've spent 3 to 6, sometimes 12 months, not improving your product, but they have

Very often competitors use an acquisition offer to:

get free competitive intelligence about your product, service, tech, code, organization, challenges, problems, weaknesses=
get in your head "here's a million dollars, it'll change your life", then string you on like a dog

98% of offers to acquire your company or product don't work out and are merely a time waste (very often by a competitor).

The process of a potential acquisition can take months of admin work and slow you down considerably.

Don't get excited over offers!

https://www.indiehackers.com/forum/how-do-you-determine-a-sale-price-for-a-side-project-d2c1d7de72

Acquirers can also use a good-cop-bad-cop strategy:

You'll have contact with multiple people in the org. Some will be "on your side" (good cop) and act like they'll do "hard work" to try to get the exec board (bad cop) to your higher price.

News flash: they all work together

There's endless more tricks they can play. Important to remember is whoever wants to buy you isn't necessarily your friend. They're a buyer. It's a commercial transaction. Treat it like that.