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Nov 15, 2021 · 24m · startup-acquisition-stories

Startup Acquisition Stories with Eyal Toledano Founder of MicroAngel

Eyal Toledano · 17m spoken Andrew Gazdecki · 3m spoken
0:00 / 0:00

gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions

In this episode of SaaS Acquisition Stories, MicroAcquire founder Andrew Gazdecki interviews MicroAngel creator Eyal Toledano about his fast-cash acquisition playbook, due diligence principles, and fund model for acquiring and incubating cash-flowing micro-SaaS products.

How this conversation actually went

Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Andrew holds 17.5% of the talking time here. How this is scored →

Andrew as informed peer 3.3 Guest teaching 3.3 Guest disagreement 0.8 Andrew pushing back 0.5
05100:0010:0020:000:26–3:31 · Andrew as informed peer 3/10 Acquiring Reconcile: Fast All-Cash Deal Strategy Andrew sets up the narrative around Eyal's first marketplace acquisition. Eyal explains how submitting an immediate half-price all-cash offer allowed him to qualify the seller and close within days.3:33–6:07 · Andrew as informed peer 3/10 Core Due Diligence Principles for SaaS Acquisitions Andrew prompts Eyal for his top due diligence principles. Eyal outlines auditing historical billed revenue rather than run-rate ARR, calculating profit on EBITDA, and sticking strictly to known niches.6:07–8:47 · Andrew as informed peer 2/10 The MicroAngel Thesis and Two-Year Bootstrapping Model Andrew asks Eyal about the thesis behind MicroAngel. Eyal lays out his model of acquiring cash-flowing micro-SaaS to replace personal salary for two years before flipping for a 2x return.8:48–12:39 · Andrew as informed peer 4/10 Incubating Founders Through Acquired Micro-SaaS Assets Andrew summarizes Eyal's operator incubation model. Eyal refines the perspective, noting that acquiring an existing asset provides 'focused chaos' with existing playbooks instead of zero-to-one guesswork.12:40–17:46 · Andrew as informed peer 4/10 Acquisition Advice for Beginners and Human-Centric Dealmaking When Eyal misinterprets a question about resources as financial capital, Andrew pushes back to clarify he meant educational resources. Eyal emphasizes that acquisition dealmaking is fundamentally about human relationships over technical minutiae.17:47–22:44 · Andrew as informed peer 4/10 Influences, Mentors, and Operating on the Business Eyal discusses influences like The E-Myth Revisited and Ryan Deiss. Andrew reinforces Eyal's point by highlighting the critical shift from working in the business to working on the business.0:26–3:31 · Guest teaching 3/10 Acquiring Reconcile: Fast All-Cash Deal Strategy Andrew sets up the narrative around Eyal's first marketplace acquisition. Eyal explains how submitting an immediate half-price all-cash offer allowed him to qualify the seller and close within days.3:33–6:07 · Guest teaching 4/10 Core Due Diligence Principles for SaaS Acquisitions Andrew prompts Eyal for his top due diligence principles. Eyal outlines auditing historical billed revenue rather than run-rate ARR, calculating profit on EBITDA, and sticking strictly to known niches.6:07–8:47 · Guest teaching 4/10 The MicroAngel Thesis and Two-Year Bootstrapping Model Andrew asks Eyal about the thesis behind MicroAngel. Eyal lays out his model of acquiring cash-flowing micro-SaaS to replace personal salary for two years before flipping for a 2x return.8:48–12:39 · Guest teaching 4/10 Incubating Founders Through Acquired Micro-SaaS Assets Andrew summarizes Eyal's operator incubation model. Eyal refines the perspective, noting that acquiring an existing asset provides 'focused chaos' with existing playbooks instead of zero-to-one guesswork.12:40–17:46 · Guest teaching 3/10 Acquisition Advice for Beginners and Human-Centric Dealmaking When Eyal misinterprets a question about resources as financial capital, Andrew pushes back to clarify he meant educational resources. Eyal emphasizes that acquisition dealmaking is fundamentally about human relationships over technical minutiae.17:47–22:44 · Guest teaching 2/10 Influences, Mentors, and Operating on the Business Eyal discusses influences like The E-Myth Revisited and Ryan Deiss. Andrew reinforces Eyal's point by highlighting the critical shift from working in the business to working on the business.0:26–3:31 · Guest disagreement 1/10 Acquiring Reconcile: Fast All-Cash Deal Strategy Andrew sets up the narrative around Eyal's first marketplace acquisition. Eyal explains how submitting an immediate half-price all-cash offer allowed him to qualify the seller and close within days.3:33–6:07 · Guest disagreement 1/10 Core Due Diligence Principles for SaaS Acquisitions Andrew prompts Eyal for his top due diligence principles. Eyal outlines auditing historical billed revenue rather than run-rate ARR, calculating profit on EBITDA, and sticking strictly to known niches.6:07–8:47 · Guest disagreement 1/10 The MicroAngel Thesis and Two-Year Bootstrapping Model Andrew asks Eyal about the thesis behind MicroAngel. Eyal lays out his model of acquiring cash-flowing micro-SaaS to replace personal salary for two years before flipping for a 2x return.8:48–12:39 · Guest disagreement 1/10 Incubating Founders Through Acquired Micro-SaaS Assets Andrew summarizes Eyal's operator incubation model. Eyal refines the perspective, noting that acquiring an existing asset provides 'focused chaos' with existing playbooks instead of zero-to-one guesswork.12:40–17:46 · Guest disagreement 1/10 Acquisition Advice for Beginners and Human-Centric Dealmaking When Eyal misinterprets a question about resources as financial capital, Andrew pushes back to clarify he meant educational resources. Eyal emphasizes that acquisition dealmaking is fundamentally about human relationships over technical minutiae.17:47–22:44 · Guest disagreement 0/10 Influences, Mentors, and Operating on the Business Eyal discusses influences like The E-Myth Revisited and Ryan Deiss. Andrew reinforces Eyal's point by highlighting the critical shift from working in the business to working on the business.0:26–3:31 · Andrew pushing back 0/10 Acquiring Reconcile: Fast All-Cash Deal Strategy Andrew sets up the narrative around Eyal's first marketplace acquisition. Eyal explains how submitting an immediate half-price all-cash offer allowed him to qualify the seller and close within days.3:33–6:07 · Andrew pushing back 0/10 Core Due Diligence Principles for SaaS Acquisitions Andrew prompts Eyal for his top due diligence principles. Eyal outlines auditing historical billed revenue rather than run-rate ARR, calculating profit on EBITDA, and sticking strictly to known niches.6:07–8:47 · Andrew pushing back 0/10 The MicroAngel Thesis and Two-Year Bootstrapping Model Andrew asks Eyal about the thesis behind MicroAngel. Eyal lays out his model of acquiring cash-flowing micro-SaaS to replace personal salary for two years before flipping for a 2x return.8:48–12:39 · Andrew pushing back 1/10 Incubating Founders Through Acquired Micro-SaaS Assets Andrew summarizes Eyal's operator incubation model. Eyal refines the perspective, noting that acquiring an existing asset provides 'focused chaos' with existing playbooks instead of zero-to-one guesswork.12:40–17:46 · Andrew pushing back 2/10 Acquisition Advice for Beginners and Human-Centric Dealmaking When Eyal misinterprets a question about resources as financial capital, Andrew pushes back to clarify he meant educational resources. Eyal emphasizes that acquisition dealmaking is fundamentally about human relationships over technical minutiae.17:47–22:44 · Andrew pushing back 0/10 Influences, Mentors, and Operating on the Business Eyal discusses influences like The E-Myth Revisited and Ryan Deiss. Andrew reinforces Eyal's point by highlighting the critical shift from working in the business to working on the business.

speaking balance: gold is Andrew, purple is the guest (3 minute bins)

0:00 · Andrew 16.6% · guest 83.4%0:00 · Andrew 16.6% · guest 83.4%3:00 · Andrew 10.9% · guest 89.1%3:00 · Andrew 10.9% · guest 89.1%6:00 · Andrew 7.7% · guest 92.3%6:00 · Andrew 7.7% · guest 92.3%9:00 · Andrew 11.5% · guest 88.5%9:00 · Andrew 11.5% · guest 88.5%12:00 · Andrew 44.5% · guest 55.5%12:00 · Andrew 44.5% · guest 55.5%15:00 · Andrew 7.1% · guest 92.9%15:00 · Andrew 7.1% · guest 92.9%18:00 · Andrew 18.2% · guest 81.8%18:00 · Andrew 18.2% · guest 81.8%21:00 · Andrew 25.5% · guest 74.5%21:00 · Andrew 25.5% · guest 74.5%24:00 · Andrew 0% · guest 100%24:00 · Andrew 0% · guest 100%
Sharpest disagreement ▶ 1:56 Calling the listing price outrageous

Eyal bluntly dismisses the seller's asking price of $350k on $73k ARR as outrageous before offering roughly half in cash.

 Hardest push from Andrew ▶ 14:11 Reframing question around learning rather than money

Andrew directly interrupts to redirect the conversation after Eyal interprets 'resources' as having half a million dollars to invest.

 Biggest teaching moment ▶ 3:53 Auditing historical revenue patterns

Eyal educates on due diligence by explaining how visual charting of actual billed revenue exposes churn caps that top-line ARR numbers hide.

 Andrew holds their own ▶ 21:20 Validating the E-Myth operational shift

Andrew demonstrates his own operator experience by expanding on how true business transformation only occurs when founders work on the business rather than in it.
the scores for every segment, with the reasoning behind each
ChapterTopicAndrew as informed peerGuest teachingGuest disagreementAndrew pushing backWhy
Acquiring Reconcile: Fast All-Cash Deal Strategy 3310 Andrew sets up the narrative around Eyal's first marketplace acquisition. Eyal explains how submitting an immediate half-price all-cash offer allowed him to qualify the seller and close within days.
Core Due Diligence Principles for SaaS Acquisitions 3410 Andrew prompts Eyal for his top due diligence principles. Eyal outlines auditing historical billed revenue rather than run-rate ARR, calculating profit on EBITDA, and sticking strictly to known niches.
The MicroAngel Thesis and Two-Year Bootstrapping Model 2410 Andrew asks Eyal about the thesis behind MicroAngel. Eyal lays out his model of acquiring cash-flowing micro-SaaS to replace personal salary for two years before flipping for a 2x return.
Incubating Founders Through Acquired Micro-SaaS Assets 4411 Andrew summarizes Eyal's operator incubation model. Eyal refines the perspective, noting that acquiring an existing asset provides 'focused chaos' with existing playbooks instead of zero-to-one guesswork.
Acquisition Advice for Beginners and Human-Centric Dealmaking 4312 When Eyal misinterprets a question about resources as financial capital, Andrew pushes back to clarify he meant educational resources. Eyal emphasizes that acquisition dealmaking is fundamentally about human relationships over technical minutiae.
Influences, Mentors, and Operating on the Business 4200 Eyal discusses influences like The E-Myth Revisited and Ryan Deiss. Andrew reinforces Eyal's point by highlighting the critical shift from working in the business to working on the business.

Statements from this episode (7)

Disclosure
Toledano: MicroAngel's first acquisition was Shopify app Reconcile in February 2021
“I bought a B to B SaaS Shopify app called Reconcile, which basically helps Shopify stores send all of their payout transactions and all of that accounting data over to zero automatically, which usually takes like, 20 to 25 hours to reconcile every single trans…”
Eyal Toledano Nov 15, 2021 ▶ 1:09
Disclosure
Toledano countered Reconcile's $350K asking price on $73K ARR with $180K cash
“They were reporting, you know, like, 73 K in our ARR and asking for 350 K which was, I found outrageous for, like, that kind of product but I didn't mind, like, I still got in touch, you know, I still basically did my thing, and Basically made an offer, which …”
Eyal Toledano Nov 15, 2021 ▶ 1:59
Disclosure
Toledano bases his software acquisition offers on EBITDA rather than ARR
“Like, I don't really make offers on ARR. I make offers on EBITDA. You know, like, that's the whole point, is how much can I get out on my investment?”
Eyal Toledano Nov 15, 2021 ▶ 5:09
Disclosure
Toledano is investing $500K to acquire micro-SaaS products for MicroAngel
“My goal basically is to invest, like I'm investing a half a million dollars over the next few months, which I'm almost done.”
Eyal Toledano Nov 15, 2021 ▶ 6:54
Prediction Not checkable as stated
Toledano predicts his $500K MicroAngel portfolio will return 2x in two years
“And because they are growing really slowly over a period of two years, they'll reach a certain point where the value of my portfolio will allow me to sell it. So I can perceive a two X return on that half a million dollars two years later.”
Eyal Toledano Nov 15, 2021 ▶ 7:39
Insight
Toledano: Buying a SaaS is 'focused chaos' with identifiable problems
“The advantage with something when you buy it is that it's more focused chaos, you know, like you're buying something where you know where the fire is, and you know exactly, like you have a playbook for how to fix it”
Eyal Toledano Nov 15, 2021 ▶ 11:58
Insight
Toledano: Product-market fit is a singular event; execution is more important
“Market product fit is super important, but it's a singular event, like in the life of a product. Like after you're done with that, then everything starts, you know, like that's so much more important, you know, in my view now is how you execute.”
Eyal Toledano Nov 15, 2021 ▶ 12:10
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