Ask HN: Where to sell your profitable company

#1

Post by to_the_top » Tue, Aug 31, 2010, 7:48 PM UTC

I am a student living in Canada, over the last 2 years I have built out a company in a niche market where at the time there were a couple of competitors (now around 5-6). 3 of them are VC funded.

I am doing this part time still and trying to earn my business degree but now I am finishing up and want to sell this business so I can try something new, the business generates around 2 million a year (CAD) in profits, so I am wondering what sort of 'investment banks' or people I should get in touch to sell this company.

I love working on this and would not mind working on it a more, the sad part is, being in Canada and not a active guy in the 'VC/Tech' scene so I don't know which route to take or who to approach.

Re: Ask HN: Where to sell your profitable company

#2

Post by to_the_top » Tue, Aug 31, 2010, 7:50 PM UTC

Forgot to mention, I built it up myself and still maintain it myself only and that I am looking for a exit because I want to pursue something even bigger with the funds I get from selling this.

Re: Ask HN: Where to sell your profitable company

#3

Post by johng » Tue, Aug 31, 2010, 7:54 PM UTC

Can't help you with finding a VC, but I can tell you that others will be interested in the following:

How will this business fare with you gone completely?

Is it something anyone can be trained to do?

If so, what barriers to entry are there to keep someone else from duplicating what you've done without buying you out?

Re: Ask HN: Where to sell your profitable company

#4

Post by to_the_top » Tue, Aug 31, 2010, 8:25 PM UTC

johng wrote: post #3

Can't help you with finding a VC, but I can tell you that others will be interested in the following: How will this business fare with you gone completely? Is it something anyone can be trained to do? If so, what barriers to entry are there to keep someone else from duplicating what you've done without buying you out?

The business is 80% automated, the rest is just maint. work such as: sys admin, emails, approving certain things etc. so yes someone can be trained very easily. Barriers to entry... none really in the sense we do not necessarily have much proprietary 'technology' except we have the users/the revenue/infrastructure in place.

Re: Ask HN: Where to sell your profitable company

#5

Post by shafqat » Tue, Aug 31, 2010, 9:17 PM UTC

Can you share what it is? I can atleast intro you to some of my investors if the business/product is compelling and you would at all be interested in taking some investment and continue working on it? Or you can email me (see my profile).

Re: Ask HN: Where to sell your profitable company

#6

Post by enjo » Tue, Aug 31, 2010, 9:50 PM UTC

Go straight to your well funded competitors. They'll love the chance to talk acquisition more than likely.

Re: Ask HN: Where to sell your profitable company

#7

Post by exline » Tue, Aug 31, 2010, 9:57 PM UTC

I've got to ask why sell? If it generates 2 million in profit a year, it should be generating plenty of cash to bank roll your next endeavor.

Since you are the only one maintaining you can simply hire 2-3 people to do the work you are currently working and keep the rest of the profit. Most people here would kill to have a business that is generating 2 million in profit.

Re: Ask HN: Where to sell your profitable company

#8

Post by alexsherrick » Tue, Aug 31, 2010, 9:58 PM UTC

to_the_top wrote: post #4

johng wrote: post #3

Can't help you with finding a VC, but I can tell you that others will be interested in the following: How will this business fare with you gone completely? Is it something anyone can be trained to do? If so, what barriers to entry are there to keep someone else from duplicating what you've done without buying you out?

The business is 80% automated, the rest is just maint. work such as: sys admin, emails, approving certain things etc. so yes someone can be trained very easily. Barriers to entry... none really in the sense we do not necessarily have much proprietary 'technology' except we have the users/the revenue/infrastructure in place.

Hey I'll help with the maint if you are looking for somebody ;)

Re: Ask HN: Where to sell your profitable company

#9

Post by dmillar » Tue, Aug 31, 2010, 10:02 PM UTC

Have you been approached by any VCs in the past? I would revisit that if possible.

In my experience, there is no shortage in VC contact for any, even modestly, profitable business online. So, I am sure you've heard from at least a small handfull.

Re: Ask HN: Where to sell your profitable company

#10

Post by apalmblad » Tue, Aug 31, 2010, 10:04 PM UTC

Where in Canada are you based? Your options may vary if you're in a big market (TO, Vancouver, Montreal...) or not.

That said, I'd imagine your best route is to find local investor/angel/business-mentor types who can recommend a firm that specializes in getting companies acquired. I'm based in Vancouver, and my business partner has definitely had getting-to-know-you meetings with a law firm - recommended by an investor - that handles that sort of thing.