I got offer to sell my business after 2 months for 10k USD

Yesterday one guy pinged me that he wants to buy my business, DocTemple. To be honest, I didn't expect that one after just 2 months after first release.

So far I have 23 customers (all from LTD deal) with no marketing budget so pure profit.

I asked for a number because it's hard for me to tell how much could I ask for it, but my question is: should I even sell it and cash out or just treat it as an indicator of interest and double-down on it?

edit: Got the number - it's 10k USD

You should:
  1. cash out
  2. double down
  1. 9

    Selling LTD's and finding users willing to pay monthly are 2 completely different areas and for this type of product, straight up, it won't be easy to find users willing to pay monthly from a marketing perspective.

    Personally, if someone offered me $10K for what you have here with no MRR and I had already cashed in the LTD sales, I'd bite their hand off and use the LTD revenue to focus on another idea (if you have one) and the $10K to provide myself some time and a runway.

    Just my 2 cents but basically, it depends on;

    1. If you have another idea.
    2. How much time you have already spent on this if you did the development too.
    3. Do you think you can achieve $500 MRR within the next year? If not, an offer at 20x the MRR you don't have is not a bad offer.

    If you’re new to marketing a SaaS, feel free to schedule a free consultation with me https://getrhys.com and I’ll see if I can give you a few pointers.

    1. 1

      Do you think you can achieve $500 MRR within the next year? If not, an offer at 20x the MRR you don't have is not a bad offer.

      This is what it boils down to.

    2. 1

      Yes, exactly! Two completely different areas and the concern you brought up is to the point.

      Regarding your bullet points:

      1. I don't have another idea yet, but I'm not afraid of it either. I will find something.
      2. In total that would be around 150h in total (I didn't actually count).
      3. $500 MRR is like ten customers so I think it's possible - after all LTD customers are still customers that needed that tool so I bet there are more as in need as they are.
      1. 1

        You mention it’s “like 10 customers” so, that’s 10 people paying $50 a month for your service.

        If you don’t have any users paying $50/pm yet, how do you know they will pay that?

        Personally, I think $50/pm is too much for this and you’ll need to set the price at around half of that.

        1. 1

          I think it will be a good idea to run test ad campaign before selling to know that - right now hard to tell.

          Regarding price - I put $50/m based on how much time and labor it saves. If doing it by hand costs you more then it makes sense to pay that amount.

  2. 6

    This is the same as if someone hired you to build this.

    1. 2

      $10k for this product ? I'll build in half if anyone interested. #JustSayin

  3. 4

    First congrats on the product and the offer. Second, you should ask yourself, do you need that money right now? Do you have time to keep working on the product? But most importantly, do you enjoy working on the product? You get the picture.

    No one here can really decide for you. You should ask yourself some questions and take your own decision.

    1. 1

      Thanks! Cashing out is for sure safer option, but on the other hand I don't need that money badly. If I would it would be more of a nice bonus to have. I enjoy working on the product, but I don't envision it as for now to my top product. I still really like what @levelsio did - something for the masses with almost zero responsibility and constraints. He can do whatever he wants to do with his site and no one really can not make him do so.

      With B2B there is more responsibility and expectations which I don't necessarily like, but I'm in one basically now so yeah, it's not perfect situation, but it's not bad either.

  4. 2

    If you love what you are doing and have a plan, I would consider continuing for at least 12 more months and create a decent monthly recurring revenue. For example, keeping simple on my side:

    • Let's say you set a plan to sell 200 accounts for 49 USD/month. That's 9800 USD/month.
    • If the processing is done on the user's local machine, you little monthly expenses. If ht is done on the cloud, you still have little monthly server expenses.
    • You could sell for a multiple of 2x-4x your yearly profit (maybe around 180k USD?).

    Let's say you want to make the effort, can use the cash right away, then ask for more based on specific indicators (market, competitor, investment, retention, etc.) and if needed negotiate down.

    Check this article: https://feinternational.com/blog/saas-metrics-value-saas-business/.

    1. 2

      To say I love it it might be too much, but it's a nice potential cash cow that I wouldn't mind working on :)

      I like the bullet points you made: for sure some people will stick to browser-processing because the don't need API so that would make it look even better.

      The only challenge I have is: will I be able to sell monthly plans instead of LTD's?

      Phew, that article is looooong, but really knowledgeable!

  5. 2

    New here and irrelevant question but what does LTD deal mean ?

    1. 2

      Life time deal, customer pay a big amount upfront instead of paying every month and they get access for the lifetime of your saas

    2. 1

      This comment was deleted a year ago.

  6. 2

    I wouldn't sell so early. However, it depends on your circumstances. Whether you love your product, whether you believe in your product, etc. Also, it doesn't mean that he/she wants to buy. People are asking for a price without much thinking.

    1. 1

      Okay, got the number - he offered 10k USD because revenue is not recurring.

      1. 1

        This comment was deleted a year ago.

  7. 1

    I think you have the potential to earn much more than $10k in the future, so double down and keep grinding and exit for a much higher number in the future!

  8. 1

    Hey @jeandesuis, did you succeed in selling it? How did you go about the selling process?

    1. 1

      Not yet, still in the process - mostly because the revenue is not recurring.

      1. 1

        Hope the offer goes well @jeandesuis. I would love to learn just the process of how you're going about the sale. I'm looking validate my idea to build a tool to help people buy and sell online businesses. I've also been interviewing people who have bought and sold businesses. If you're interested, I can share what I've learned. You can email me at [email protected].

  9. 1

    Congratulation on the offer!

    I am curious about your pricing model. You’re charging 49/month or 89/life (and only 199/life after the early bird). What’s the logic behind charging so little for the lifetime deal relative to the monthly price?

    1. 1

      It's a compromise between LTD communities expectations and actual value. It was also a test which was semi-successful (I sold half of the available deals).

  10. 1

    Man that is an ideal product. Straightforward use case, no/low backend cost so very scalable, no complex logic/machine learning type things where bugs are going to pop up all the time, not even a complex UI. I’ve been trying to make a simple product like that for a while!

    Personally I would likely sell, because as others mentioned there’s no recurring revenue and (from what I can see) there’s not much barrier to entry to it could be more easily replicated by someone else.

    But I’d also take into account how scalable getting those customers was. If you burnt through all your leads and don’t think you could find more customers then sell, if you just ran a simple ad and could easily just do that again then keep it going!

  11. 1

    I might post about this in another stream but in my experience (been involved in raising over £35 million in investment between 2 startups), offers are just that, offers. I've found with songbox that offers come along fairly frequently. Concluding a deal and actually getting cash out of someone are entirely different things to getting an offer.

    I've entertained a few that ultimately petered out to nothing and I've disregarded others because I assumed they would Peter out to nothing.

    If I was you I'd take it as far as possible, even if really you're not interested in selling, just to get the experience of it.

    1. 1

      I can relate - I sold my first business one year ago and I had like dozen of offers, but only one really went through. What I noticed the guy that actually bought it was fast - he didn't made any problems, he just wanted to pull this deal through and that's what I'm looking for in prospective buyer now. If I feel someone is fooling around then high chance it won't happen.

      And for sure there will be some negotiation.

  12. 1

    I would ask more about the buyer, why do they want to buy it? My guess is they already have a user ready to sell to. Probably enterprise. Perhaps there is a better deal here where you can get monthly revenues and they can too for the sale commission.

    1. 1

      He told me that upfront: "I typically look at growth, retention, revenue and costs and give a standard SaaS multiple based on all these factors. I'm a software engineer by trade and I run a tiny private equity shop where I buy small businesses like yours, grow them, and continue to operate them for the foreseeable future to generate cash flow."

      I get him in a sense because I want to have apps that generate cash flow. Even if he has already a customer for it somewhere else - well, he has. Not me. Access is a big value to bring to the table. Or maybe should I go for joint venture?

      1. 1

        I mean, if he would be up for you to be the maintainer of the project and get paid for that as part of the proceeds, sounds like it could fit with your plan. Depending on what you are looking for, might be worth exploring.

  13. 1

    Checked out your product, it's pretty cool and could be very useful to a lot of organizations. If you're looking to just make some large chunks of money. Consider advertising some integration option / services. Imagine law firm XYZ doesn't want to do some manual steps each time so set it up so they can drop the files into a dropbox folder or something and in 5 minutes it makes a new one with the merged content for them, securely in their own dropbox or something.

    If you need $$$ there is often ways to do it with some coding / services on top of your solution for people who are digging it and using it.

    10k just isn't that much in the scheme of things and to transfer the business / assets right you'll probably have more hoops to jump through and all the questions and help with maintaining it or assistance in moving hosting etc.

    Keep pushing it, it looks cool.

  14. 1

    Congrats! Big milestone I would say, meaning you're building valuable things (in a way that someone would buy it)

    Often times in life you're better off cashing out than holding on, this comes down to:

    • Are you passionate about this project? Can you imagine yourself doing it for years?
    • Do you think this project has the potential to go really big? Or is it a lifestyle project?

    With these answers, think you'd know the answer. If answers are no, cash out and build something else!

    1. 1

      I'm not that passionate about the project - I like it as a potential lifestyle project, maybe a little cash cow but that's it :) To go really big I don't see it for myself - I'd rather do something that will keep me coding it. DocTemple I code now only when there is any request to add a functionality.

      1. 1

        easy then, sell to get some cash!

        1. 1

          Yes, seems like a reasonable move!

          Interestingly enough, out of 70 votes so far in the poll - 70% is after doubling-down instead. This thread gets more and more interesting :D

          1. 1

            well its a quick poll after reading briefly :P

  15. 1

    I get offers from people to buy my business every other month, but they have higher standards, requirements the business needs to meet.

    Do your due diligence, don't get caught in the hype of the novelty but rather aim to see it objectively and think whether this is going to be a waste of your time (ie. there's no viable interest just researching you) or if this is a credible offer. If it is a credible offer then first come to terms on what you want to do before you allocate time into diving into various options.

    At your stage (2 months) it may be too early. Do try to separate emotion from rational thinking though, it's easier said than done.

    1. 1

      I already sold one business before - so I know it's not gonna happen within days. Probably 2-3 weeks so I take that into account as well. Also he asked a lot of questions before sending me offer and asked me for questions as well for which I replied that I need couple of days because I want to think it through.

    2. 1

      This is a good point too, you might have to deal with this "buyer" for a long time and tedious process..

  16. 1

    Don't sell it, unless you're not passoionate about the niche.

  17. 1

    use appsumo for generate user base and sell later your will got two pile of cash

  18. 1

    Don’t sell it if you enjoy running it and you have plans for more features.

  19. 1

    How much is the product part of your vision .. if it is just a fun side project that you don't want it to take over your life, then cashing out is good ? I think you have to figure out the odds of this and the other and whether you want to take paths where it is going either way.

    1. 2

      I really like what @levelsio is doing and how. DocTemple is nice, but it's not like I'm hell yeah and all over it - I just mildly like it because some people bought it so my experiment wasn't failed. Now, your question made me think what I really want - I mean: do I want product that I just have or to actually have something that makes me tap dance out of my bed everyday?

      If the latter I should probably sell to fund something that will actually tickle my pickle.

      Oh, and I updated my question with the offer - I got it today

  20. 1

    I guess it will depend on what your own goals are.

    If this is a product you genuinely enjoy working on and can continue to grow, dowbling down might be the best option.

    Keen to follow this thread and see what offer you get back.

    1. 1

      I updated my question with the offer I received

      1. 1

        Nice. How are you feeling about it?

        1. 1

          Confused, to be honest. From one side it's great to hear someone sees enough value to put money on the table. On the other hand, maybe he sees what I don't and now it bothers me a bit. After all, $10k is not THAT much - it's a nice bonus, but still it's not FU money.

  21. 1

    I’d probably ask to see what the offer is! Never hurts knowing what they’re willing to pay.

    Without an amount it’s hard to know if it’d make sense to sell.

    1. 2

      Already asked him! We'll see when he will get back and if

    2. 1

      I updated my question with the offer I received

      1. 1

        That is beyond small. I would call this "the bullshit offer". Personally I would never ever sell for this price. It's very likely someone that would make 100x+ from your product.
        Since you already have customers, I would say if you double down, you'll soon be making that every 2 months or so.

        1. 2

          I will bring more context here:

          • 23 customers in something like 2 months (most of them in the first month)
          • all LTD one-time customers so no recurring revenue
          • almost no backend costs (browser-powered processing so far - at last until there will be API available)

          The guy said that price is $10k because I have no recurring customers. For me it's hard to tell now if I can find recurring customers because I have none so far. And if I decide to keep the business I will definitely need them because API service I'm planning will bring some server costs into the equation.

  22. 0

    the offer is too low, period. Think about it this way, how many customers would you require to hit the 10k target in one year? maybe 40 new customers a month? You could easily find that amount of people for this product. Look into advertising it and nail down your target clientele, you shouldn't have issues reaching this number after a few months of smart marketing.

  23. 1

    This comment was deleted a year ago.

    1. 1

      Sure! Thanks for the offer - will keep that in mind :)

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