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I almost sold Baremetrics for $5M

baremetrics.com

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Re: I almost sold Baremetrics for $5M

#191

Post by eli »

6gvONxR4sf7o wrote: post #160
quickthrower2 wrote: post #138

Sounds like there needs to be a way for the buyer to put some skin in the game. Maybe asking for a $50k non-refundable deposit to kick things off. Sounds harsh? Well non-refundable deposits are a thing in real estate. For example in my country it is common to put 0.25% down to take the property off the market, non refundable, allowing you to do due diligence and then 19.75% deposit within 5 days non-refundable, with…

Or just have the buyer pay both sides' acquisition related fees from the get go (legal, accounting, etc).

I don’t see why they would agree to that

Re: I almost sold Baremetrics for $5M

#192

Post by perl4ever »

david_shaw wrote: post #92
rb808 wrote: post #83

Earlier quoted context omitted.

I've heard this too, except it got really annoying to be working crazy hours doing annoying crap while you have a team of devs working 40 hrs working on interesting tech with not much pressure. I burnt out, now I delegate lots of crap work and it works better for me and I think the team as well as they get a wider perspective.

> I burnt out, now I delegate lots of crap work and it works better for me and I think the team as well as they get a wider perspective. I think this is an underrated (but very accurate) opinion. While I'm not the founder of a company, I do have the tendency to shield my team from much of the insanity I deal with on a daily basis. I've made active, conscious efforts to stop doing this. When you shield your team from…

"They want to grow"

I've never experienced a manager who seemed really in tune with how I think one should treat people. They usually intend well, but effusive over the top praise makes me uncomfortable for several reasons;* the only thing worse than that is demanding contradictory or impossible things.

It seems to me that a leader needs to be a like a coach. I haven't even ever played team sports, but it seems intuitively obvious to me that you reward people by gradually trusting them more as they prove themselves, and continually stretching what is asked of them to find limits and what fits them best. And you shape everything around the good people you can find, rather than trying to get people who are plug and play for a pre-existing approach.

The hard part I think is that it is so easy to ask far less of someone than they are capable in one area, and more than they are capable of in another. Both can lead to demoralization or even disaster.

*If you're continually praising me, it starts to seem as though you had low expectations and you're not raising them fast enough. Or you think I'm easily manipulated.

Re: I almost sold Baremetrics for $5M

#193

Post by HatchedLake721 »

throw3982 wrote: post #181

Is there any forum or group that has people that can advise on such matters? I know HN is one but it's too big/too impersonal for this. I mean a place for founders to find "mentors" (i.e. people with more experience or people that have done similar things before) that would be willing to help them with things as a sale to a big company or how to structure a deal.

Funnily enough, WeWork Labs

Re: I almost sold Baremetrics for $5M

#194

Post by o-__-o »

alias_neo wrote: post #86
geebee wrote: post #61

Earlier quoted context omitted.

beautiful metaphor. anyway, I quasi-agree, though I've become suspicious of managers who claims to be an umbrella protecting their team from the rain. Half the time, they're really just trying to make sure their team doesn't see the forecast and quit.

I guess umbrellas also keep the sun out. What you need are those clear plastic umbrellas, no rain, but all the sun. Transparency.

Raining shit would be opaque, tho

Re: I almost sold Baremetrics for $5M

#195

Post by grdeken »

kresten wrote: post #171
trentnix wrote: post #170

Earlier quoted context omitted.

The LOI, at least the ones I've read, prevents you from discussing sale opportunities with anyone else. It's called a "no shop" clause. Before the LOI? Go crazy.

I’d rather not do the deal than have a no shop clause. A no shop clause destroys so much deal leverage. I can see why the buyer would want it. In fact a no shop clause is indistinguishable from an exclusivity agreement. If the buyer absolutely required it I’d put a hefty non refundable price on it, probably 50% of deal value. Such a commitment has to work both ways.

This is wishful thinking at best.

Re: I almost sold Baremetrics for $5M

#196

Post by [deleted] »

Seufman wrote: post #174
kresten wrote: post #171

Earlier quoted context omitted.

I’d rather not do the deal than have a no shop clause. A no shop clause destroys so much deal leverage. I can see why the buyer would want it. In fact a no shop clause is indistinguishable from an exclusivity agreement. If the buyer absolutely required it I’d put a hefty non refundable price on it, probably 50% of deal value. Such a commitment has to work both ways.

No shop clauses are normal -- no serious buyer would move forward with diligence without it

[deleted]

Re: I almost sold Baremetrics for $5M

#197

Post by throw3982 »

bkanber wrote: post #189
throw3982 wrote: post #181

Is there any forum or group that has people that can advise on such matters? I know HN is one but it's too big/too impersonal for this. I mean a place for founders to find "mentors" (i.e. people with more experience or people that have done similar things before) that would be willing to help them with things as a sale to a big company or how to structure a deal.

I'm in a program in NYC called https://www.venwise.com/ , it's a moderated CxO peer group that meets for a long session every month and does exactly this.

Thanks.

Anything in London?

Re: I almost sold Baremetrics for $5M

#198

Post by kenneth »

kresten wrote: post #171
trentnix wrote: post #170

Earlier quoted context omitted.

The LOI, at least the ones I've read, prevents you from discussing sale opportunities with anyone else. It's called a "no shop" clause. Before the LOI? Go crazy.

I’d rather not do the deal than have a no shop clause. A no shop clause destroys so much deal leverage. I can see why the buyer would want it. In fact a no shop clause is indistinguishable from an exclusivity agreement. If the buyer absolutely required it I’d put a hefty non refundable price on it, probably 50% of deal value. Such a commitment has to work both ways.

Good luck finding a counterparty that won't ask for a no shop clause. As a VC all our term sheets have legally binding no shop and confidentiality clauses. That's industry standard.

Re: I almost sold Baremetrics for $5M

#199

Post by thethimble »

mlyle wrote: post #178
kresten wrote: post #177

Earlier quoted context omitted.

Maybe a no shop clause should have a tight time to live.... “ok we commit but only if you put the money in our account within seven days, after that shopping is ok”

Deals take a lot longer than 7 days to close-- especially real acquisitions, but even asset purchases usually take months.

There's a lot of misconceptions here around how corporate acquisitions work. Here's typically how things work in practice when companies are sold:

- Seller attempts to garner interest, sometimes facilitated by an investment bank.

- Buyers indicate interest informally, eventually culminating in a Letter of Intent (LOI) from each buyer indicating a price and other important factors related to a deal.

- A cricitical component of the LOI is an exclusivity period - a duration of time where the buyer is able to conduct due diligence in exclusivity. It's clearly in the best interest of the seller to minimize the duration of the exclusivity period.

- Discoveries in the exclusivity period are typically grounds for renegotiation. Vulture buyers typically crush sellers and completely renegotiate a deal in this period banking on the fact that the seller has no alternatives post exclusivity. Good buyers know their reputation is at stake if they renegotiate an LOI and will only do so if material things show up in diligence (reasonably common).

- The LOI is not an obligation to purchase. Mostly the buyer is putting their reputation on the line.

- Earnest money is extremely rare in corporate acquisitions because the buyer universe is sufficiently small such that reputation is a sufficient motivator for good behavior. That said, anything is negotiable and you can go against tradition at any point if you have enough leverage (interested buyers).

Re: I almost sold Baremetrics for $5M

#200

Post by dlhavema »

grogenaut wrote: post #97
hermanradtke wrote: post #35

Earlier quoted context omitted.

Amazon’s flash sale site, my habit, was launched this way. Source: I worked for a flash sale company they did this to.

Having been involved in the other side of these types of transactions usually the large company is actually interested in making the purchase because buying a successful product is easier than building your own even if you're something as big as Amazon. however often during Discovery you find out major problems with the company that you want to acquire that make it become pointless to actually do it. usually by the t…

I thought Woot.com was an early player in that space.
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