The Exchanges

Q a business, and the teacher, the teacher loved it. He was like, that's what, so, um, Chico State does have a pretty good, um, entrepreneurial, um, department, and I, I'm forever grateful for them, but, um, anyway, story for, uh, for another time, but, um, my, uh, my next question would just be, um, you know, you look at, I, how many deals do you look at, like, a month?

A Yeah, we actually, uh, you must not be, well, let me back up, hundreds, and we actually document it for our investors, like just, I think they like the notion of like, okay, and it's like by month, so in, uh, you know, we're recording in February, we just put out a letter for everyone that says, in January, we looked at X number of deals, and let's, it was probably a 153 or something like that. The, you know, the only ones that made it through the first filter were these 30, And we're down to, like, actual investigation on these five, and two may have a chance of going to a letter of intent. So we actually publish all that for our investors.

AI assessment note: “hundreds, and we actually document it for our investors... was probably a 153”

Q Nice. And I guess, um, you know, how did you get into all this? Like, what made you wake, um, did you just wake up one day and say, hey, I want to acquire 50 plus companies? Like, how did, how did this happen?

A I wish I was that insightful. Um, no, I, I had spent 15 years in corporate America at a company called Cerner, which is a software company, but Gigantic. Um, when I started, it was 3000 people and three hundred million in revenue. So already quite big. And then 15 years later, when I left, it was 20,000 people and I think five billion in annual revenue. So night and day different from what I'm doing now, but I, I share that with you to give some context to like, all I know about business is the software industry. And I got to do sales and And leadership and management, and run development teams, and customer success teams, and all, got to do just about everything in a software company, except for write code, because I'm not a, I'm not a developer. Um, and that was a great long run of a career. I was super happy as a great company to work for, and I was just ready to do something else. Um, along the way, I went and got an MBA, and realized that entrepreneurs You know, yourself excluded are not necessarily like geniuses or, you know, the hardest working people in the world or like have some heroic talent. They just like maybe see the world a little differently than other people, a little bit higher risk tolerance, a little bit harder worker. And yeah, I just realized like I could do that. And so I had always dreamed of owning my own business, but never had, um, the right idea. An…

AI assessment note: “I had spent 15 years in corporate America at a company called Cerner”

Q So how do you evaluate those startups? Like, what's kind of like your sweet spot in terms of, like, what gets it over the finish line?

A Yeah, so from, like, Top of funnel down, you know, it's, it's gotta be SaaS. It's gotta be profitable. We like writing checks between one and ten million dollars. So those are three pretty quick filters if you're too small or too big. You know, we still get inbound interest from people trying to sell like digital marketing agencies, and I love that. You can see it's super healthy business. There's nothing wrong with running an awesome digital marketing agency. It's just not Something we would buy. Um, and so then you start looking at more of the details of like, okay, what, what niche is it in? Is it something we understand? Is the, you know, we're pretty tech stack agnostic, um, which other people have criticized me as like, oh no, you should niche into just one thing so you can hire all the developers for that thing. And while I understand that strategy, that would have limited the number of things we could buy. And then you're kind of tied to a stack, which I, I don't really want to be tied to a stack. Um, We're industry agnostic. Then you just get into the sort of business fundamentals. Like, is it a market we like and that we can understand? And is it something that we think can continue to grow? Um, is there a team that's there or not? And that's not a, a yes or no criteria. It's just like, what value do we place on this thing? If it's a solo founder with no team and no p…

AI assessment note: “it's gotta be SaaS. It's gotta be profitable. We like writing checks between one and ten million”

Q always just like going back to your first point is just being honest. Like, where are you at your stage? What are you looking for? Um, is it advice? You're looking to sell your business. You're looking to just kind of, you know, test the waters. Like, where's my valuation at? Um, so that's, that's really good advice. And I guess, um, any, any, anything else you'd add to that?

A Yeah. Part of what I love about microacquire is that, you know, it's intended for founders to help them be successful. And I think at some point of growth or stage of a business, It's part of your obligation as the founder, CEO, whatever title you want to give to, to start thinking about these things, whether you have investors, you've got a co-founder, you've got a team or what, even just for yourself personally, this is part of the evolution of being an entrepreneur. You need to understand what it's like to sell a business, even if you're not in the market right now. So it's going beyond what you're saying, Andrew, what I wanted to add is like, it's good to educate yourself. And I'm almost like, You're obligated to educate yourself so that you're ready for that evolution of the business. Because unfortunately, sometimes it comes quicker than we're ready. And we've seen a lot of situations where people are sort of forced to sell a business for one reason or another. And if you haven't at least thought about these things, haven't had a couple of conversations, haven't like documented the things you're going to document, um, you, you're going to sell at a, you know, a discount.

AI assessment note: “what I wanted to add is like, it's good to educate yourself.”

Q Um, any sort of, like, thoughts on, you know, uh, maybe what's next for SureSwift, what's next for the industry, um, upcoming industry trends? Like, what, what's something that, um, Maybe you'd make a bet on, um, could be a growth goal for sure. Swift. It could be, uh, the market, um, just any sort of like unique industry insight that, um, you might expect to play out this year.

A Yeah, um, that's a tough question. I'm not a gambler, so I don't like making that, but, um, so the, the, the simplest question to answer, because I know the most about it, is like, what's in store for SureSwift, and I, you know, it's been seven years, and we've done a whole lot of things wrong, and there's a whole lot of things we can, you know, And still improve upon. That said, like, I'm so confident in our team, our process, where we sit in the market. Um, I, I, I'm like, we are just going to not be distracted. I feel like we are one of the best, if not the best company in the world to acquire bootstrapped B to B staff businesses between one and ten million dollars in value. Full stop. Let's just do more of that and be even better at that. And by more, it doesn't necessarily have to be more deals, but there's like more of the right deals is all I want to think about. And every, like I said, every once in a while, something comes in that looks shiny and different and cool and would be a wonderful business to own. And I'm like, nope, no distractions. So I think that's what you'll see from us is like nothing super, you know, um, different or, you know, other people might say not that interesting. Uh, we're just going to keep being awesome at what we're already really good at. As far as the market, I mean, you're better to answer that question than me, because you just have a di…

AI assessment note: “the simplest question to answer... is like, what's in store for SureSwift”

Q bubble? Like, you know, like, if we see an economic downturn, how is that going to affect acquisitions? Um, so that'll be interesting, but, well, maybe we'll see, we'll save that one for, I don't want to, I want to, I don't want to put an opinion on air where, Where I think we're at, but, uh, I will tell you, I will give you, give you a prediction here.

A Like, yes, we will see a downturn. We may be in the middle of it right now, middle of February, 20, 22. And inherently that means other people, people have less cash than they thought they did 45 days ago. And that may sort of slow acquisitions or reduce prices people are willing to pay. But It is not gonna, it is not, like, your activity, your market, Andrew, is, uh, not, you're never immune to the macroeconomic trends, but, like, I think you're pretty well isolated, and my market, like, I don't really care what the, the worldwide economy does, like, there's so, there's hundreds of thousands of startups out there who want to eventually be acquired. There's still way more than enough money in the system to go acquire those businesses, like, I wouldn't, I wouldn't sweat it if I'm you, or if I'm me, or if I'm a startup looking to get acquired in the next, you know, one to two years.

AI assessment note: “that may sort of slow acquisitions or reduce prices people are willing to pay.”

Q um, this year, like, yellow flags, or just things to prepare for, like, if they were looking to go to market, like, if you had to just give, I'm sure you could give, like, 20 tips, but if you had to pick, like, maybe the top, like, three, um, you know, what, what, What would you tell a founder, aside from having a great business? We all know that one.

A Yeah, having a great business is the easiest way to sell a business. Um, so, I, I, um, like, the simple answer is like, Be, be honest and straightforward. Um, and that, and what that means depends on what stage you are. So like, I, I tell founders all the time, it's okay to initiate a conversation or talk to somebody like me who buys businesses, even if you don't intend to sell your business for two years, or even if you think you may never sell your business, right? Then at the end of the day, like every business gets sold, right? Or every, every founder leaves their business, whether they sell it or They get put in the ground. So it's okay to have a plan, even if you don't want to exercise that plan for five years. Because I see people at conferences or online or whatever, and it's always this like, Well, I'm not ready to sell my business, but how does it work? Explain to me this or that, or like what happens to the team? You know, we get a lot of the same common questions, and I'm just like, that's fine, like you, but you don't need the preamble of we're not ready to sell, but it's okay to just like ask the question, explore, and so in that, in that stage, being open and honest and forthright is just like, look, I don't have a whole bunch of diligence stuff, like we're not going to get into a conversation about like what's my MRR and my churn or whatever, like just set expec…

AI assessment note: “the simple answer is like, Be, be honest and straightforward.”