Author here. I'm happy to answer any questions about this post, the sale process, or my time running TinyPilot.
$249k revenue & 6 people => $41.5k per person + yourself. How does this math work out...?
I sold TinyPilot, my first successful business
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Re: I sold TinyPilot, my first successful business
#112Re: I sold TinyPilot, my first successful business
#113Earlier quoted context omitted.
The broker was advising him on price point, strategy and fielding the interested parties for further discussion. Pretty important for this type of transaction.
How much of this can be learned by reading a couple books? I wonder how much higher profit he actually made compared to if one could self teach these skills.
Practical knowledge, very little.
Most of this value is in the soft areas, like how hard to push and how to manage expectations with the buyer.
Re: I sold TinyPilot, my first successful business
#114Kinda scary the lifetime profit is less than what a sr developer might expect at a big tech firm. I agree this was successful and assume it's rewarding in many other ways! But still...
If the only metric you care about is average lifetime earnings then starting a business makes no sense.
There's a lot to it that has nothing to do with earnings though and of course there's a lottery ticket that's correlated to how hard you work.
Re: I sold TinyPilot, my first successful business
#115Congratulations, and good luck with your next phase of life (baby and whatever else it brings). It's been interesting watching your journey via your blog that pops up here every year.
Re: I sold TinyPilot, my first successful business
#116"When you sell a business at TinyPilot’s scale, there’s no deposit. You can invest hundreds of hours into preparing reports for due diligence, reveal all your confidential business secrets, and spend thousands of dollars negotiating legal documents and still walk away with nothing if the buyer backs out." Great write up overall but as someone who has bought a couple of businesses, it is not just the seller who loses…
Yes, definitely agree. I didn't mean to say that the buyer has no skin in the game, just that the seller receives no compensation if the buyer pulls out of the deal. In this case, the buyer probably spent more on the deal than I did, but that wouldn't really comfort me if they had backed out last minute.
Yes of course. Basically when a deal falls through after spending weeks or months on it, both sides lose big. That's why you want to do it with professionals and have a good Lawyer and CPA on your side.
Re: I sold TinyPilot, my first successful business
#117Earlier quoted context omitted.
How is healthcare tied to employment? Isn't it available to buy on the open market?
Employer-offered plans tend to be extremely good value, so the vast majority take advantage of them. I was paying The bigger problem, IMHO, is that quitting means changing your insurance, which isn't just a financial change. It can also end up requiring you to change medical providers, which is no small deal! This adds massive friction and stress to the act of quitting/changing jobs, a major source of leverage on the…
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Re: I sold TinyPilot, my first successful business
#118Earlier quoted context omitted.
How is healthcare tied to employment? Isn't it available to buy on the open market?
In the US there is the affordable care act from ~2013, where anyone can purchase insurance from a pooled market subsidized by the government up to a certain income (50k I think). But that is also impacted by the state you live in, as the states negotiate the contracts paid by federal dollars (I know it's effed up). So the ACA is cheaper on the west coast than it is in Alabama. Today, a "gold" policy for a single man…
I have a feeling your employer is paying the difference, so basically you're paying one way or another.
Re: I sold TinyPilot, my first successful business
#119How did you get people to trust your product? If I see something like this from a small outfit for a cheap price, I will assume that the price is being made up some where else. How did you assure you customers you cant access their machines when you want. Or that your service will offer the reliability they will need?
Re: I sold TinyPilot, my first successful business
#120Earlier quoted context omitted.
How is healthcare tied to employment? Isn't it available to buy on the open market?
In US buying medical services without insurance is very expensive. You choices are: - get health insurance from your employer - get covered by insurance of your spouse - buy insurance from your own pocket - don't buy insurance and risk loosing a lot of money in case of health emergency
> buy insurance from your own pocket
In other words, buy it on the market, like the GP said.
With ACA subsidies, you'll never have to pay more than 8.5% of your income in premiums for a mid-range plan. And that's in the worst case -- it'll typically be less (if you make less, you'll qualify for larger subsidies or free healthcare, and if you make more, the proportional cost of insurance premiums will be lower).