If you've made a successful exit, can you tell us one lesson learned?
Who out there has built and sold a business? Prestigious comrades, please tell us something you learned along the way!
(I'm broke as hell, so there's no lower limit to what qualifies as a success. I'd like to hear from you whether you made $500 or $5,000,000.)
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Not as a founder, but as an executive/advisor I have been through two exits (total of over $200MM in deal value).
The two businesses were wildly different, but one consistency was that both founders had relationships of some variety with the eventual buyer. It makes the deal process smoother if you know your suitor. You don't need to be best friends with them, but seeking out acquaintances in your space that may acquire you will pay dividends long term.
Make yourself easy and attractive to acquire. Keep your team very small, your product quality very high, and build something that has a unique impact.
That’s not advice I hear every day (though I agree with it). How do you feel about MVP’s?
I like the idea of SLC's even better – simple, lovable, and complete. If you build a simple enough product, you can make it really polished and badass without wasting too much time.
So how I do it? I mean, I'm sort of introvert.
Most companies who sell (for a good price) follow a system. This involves identifying target acquirers based on aligned customer base and acquisition history of the acquirer.
You can target an acquisition the same way you sell to an enterprise customer.
One of the secrets is that large acquirers run acquisition pipelines. Meaning they want to talk to you early and will tell you what matters to them (valuation drivers).
We built two courses on this and i'm happy to give anyone free access who wants it.
Here is a summary, but there are meaningful details in the courses:
Ecosystem. Document all the players who touch your customers. During this process identify which companies could be partners and which of those have the means to acquire.
Identify & Understand Acquisition Partners. Why would they acquire your company? Remember your company is now the product. Do they want to acquire new customers or save them money? Does it increase their LTV? Do they have a history of acquisitions (see crunchbase) and is there a pattern to these acquisitions? Do they buy on top-line revenue or profit (depends on what they are after)?
Call you targets. Find the person responsible for acquisitions... some will be happy to talk with you regardless of your stage. It is their job to find great acquisitions. Ask them about partnership and if this led to acquisition in the past, what would they be looking for? This will tell you what is important to them (customer types, tech stacks, validation metrics, etc).
Plan. Once you understand how much you want to make, you can back into decisions along the way. Does that new hire add to your valuation in the eyes of an acquisition partner? Does that new feature fill a gap in their product? Many acquisitions are for a lower price than you want because the acquirer doesn't value parts of what you built.
Stay in touch. Acquisitions don't happen overnight and neither does progress. Keep your partners updated on progress.
The above is just a summary... our courses lay out a methodical framework for planning your exit. We are firm believers in starting with the end in mind.
Please add me to the free access
Hey martyb. I would be glad to have free access on your courses if the offer is still available. Cheers.
would love your feedback
Hi Martyb, I might be curious to access one of your courses. I’m not at that stage yet, but I will keep the information there for when is needed.
Hi @buymecrypto - here are instructions for getting to the courses:
would love your feedback!
Thanks!
Hey,
It looks like there is a bug on the /welcome page. The loading progress hangs on 65%, and the go to courses button stays hidden, the button doesn't work either.
You are registered and should be able to login. Thanks!
Thanks!! Looking now.
It takes a lot longer than you think.
All the hard parts people mention will happen.
Your deal is like all other deals so you'll experience the same stuff.
As much as you can, keep trying to have one eye on the business while the obvious acquisition distracts (read: consumes) you.
Most companies exit after 5-6 years of profitable operations
I once worked at a company that got acquired.
In my opinion they were doing all the wrong things. That is until I realized (after the acquisition) that they were selling a company, not a product or service. At that point it all made sense.
We were selling a crappy product to a lot of European customers. Our helpdesk was overloaded by customers complaining.
We were acquired by a Canadian company that wanted to buy their way into the European market. Of course they migrated everyone to their own product. So the product that we built was a throwaway anyway.
So if you want to sell a company, make sure you focus mainly on providing value to the potential buyer.
This comment was deleted 3 years ago.
Congrats!!
cheers!
Quick question to you, how did you find the templating business? Was it what you expected it to be. And any tips for someone going down that path?