The Founder’s Guide To Selling Your Company (2014)
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The Founder’s Guide To Selling Your Company (2014)
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Re: The Founder’s Guide To Selling Your Company (2014)
#2Great article and insight into a somewhat opaque process.
I sold my company in 2014 and the biggest surprise to me was how long and time consuming the process was. It really impaired my ability to run the company as efficiently as I would have liked during the transition process. And the stress of having to meet with buyers, but not being able to fully communicate the scope of the meetings to the team until the appropriate time was significant.
Re: The Founder’s Guide To Selling Your Company (2014)
#3I've read this a few times and having been through up and down periods it's clear that the most important part of this, is the following:
The best time to sell your startup is when you have many options.
It needs to be really emphasized that this is a very rare place for the vast majority of startups. That means this advice isn't generally applicable.
Which brings up the implicit question, why would you decide to sell your startup if you are clearly winning and growing at the pace that you can build a sellers market?
There are a lot of really good reasons you would, but I think all of them come down to: At some point you won't be able to be competitive in the market without the resources of a larger company. Whether that means you'll never be able get to an IPO, or you'll get out competed between now and then.
I've never read a good rundown of WHY they decided to sell, Twitch or otherwise.
So it's really a question of when, not if. Opportunities to sell will come in waves over time so how do you know which one you should take because it's possible to overshoot and then the whole thing goes bust (Digg, Foursquare etc...).
What I'd be interested in is the Founders guide to selling your company when it has relatively few options. That's the more common case, and one that where I think the opportunities there are missed by most founders. I never read stories about that, I've only read "we were on track to a billion in revenue and sold."
Re: The Founder’s Guide To Selling Your Company (2014)
#4This is great, but I'd love to see a post on selling a side business (no outside investment) and less than $10,000 a month in MRR.
Re: The Founder’s Guide To Selling Your Company (2014)
#5This is great, but I'd love to see a post on selling a side business (no outside investment) and less than $10,000 a month in MRR.
Re: The Founder’s Guide To Selling Your Company (2014)
#6Anyone have good links on selling a company that actually has revenue?
Re: The Founder’s Guide To Selling Your Company (2014)
#7> A company’s financial value hinges on its profits and model of its future cash flows. For the vast majority of startups in tech, this will be zero.
I’m not sure just how true that is today. In my YC batch probably 30%? of companies were profitable or at least eying profitability.
I’d actually be very curious to know what those numbers are.
Re: The Founder’s Guide To Selling Your Company (2014)
#8I've read this a few times and having been through up and down periods it's clear that the most important part of this, is the following: The best time to sell your startup is when you have many options. It needs to be really emphasized that this is a very rare place for the vast majority of startups. That means this advice isn't generally applicable. Which brings up the implicit question, why would you decide to sel…
>I've never read a good rundown of WHY they decided to sell, Twitch or otherwise.
The "Startup Podcast" episodes on Twitch is worth a listen:
Re: The Founder’s Guide To Selling Your Company (2014)
#9This is great, but I'd love to see a post on selling a side business (no outside investment) and less than $10,000 a month in MRR.
Buying small websites is a hard business, because you have to maintain them. If one engineer can maintain 10 sites, it costs $2k/mo to maintain each, so the gross profit has to be well above that to make a business out of it. Maintaining 10 sites, each written independently with their own tooling choices, requires an engineer with a very large cranium.
Re: The Founder’s Guide To Selling Your Company (2014)
#10> A company’s financial value hinges on its profits and model of its future cash flows. For the vast majority of startups in tech, this will be zero. I’m not sure just how true that is today. In my YC batch probably 30%? of companies were profitable or at least eying profitability. I’d actually be very curious to know what those numbers are.
No offense intended, but the vast majority of startups in tech don't go through YC batches or anything like that.
The vast majority are startups you'd never hear anything about. They're started by a small team or one person, they build something on the cheap, try to market it, fail, then try to sell it. Or a non-technical person pays a coder to build a site but then it doesn't take off or the coder bails, so the non-technical person tries to sell it because they put money in so it must have value.
I have personally done that 3 times (even got real customers on one). I can name 5 new startups that I've head about in the last month just in my mid-sized city. I can't imagine how many are already out there slowly dying that I just never heard about.