The Exchanges

Q Nice. Would you do any sales calls, or was it a complete product-led growth, or would you do, like, one-on-one onboarding calls or anything like that?

A We tried, we tried to do a mix. So it was product-led growth where people could start using it, sign up, pay for a subscription without ever talking to anybody. To the extent that people wanted to have calls or wanted a demo to see what it was, the platform was about, you know, I was always flexible, able to have a call with them. I also always tried to be very involved on the support side. So after users would sign up, I'd offer to get on a call with them to show them product and make sure they got stood up. That wound up being really beneficial from a retention standpoint of the users that signed up, paid, And then booked an onboarding call after we're far more likely to be with us six months later.

AI assessment note: “We tried to do a mix. So it was product-led growth”

Q Nice. And then if you were giving advice for a founder that was launching a new product, um, where would you direct them? Would you tell them try cold outreach? Would you tell them social media posting, um, something different based on the business? Like, what advice, um, would you give to attract your first customers?

A Social media, I think, has become a little bit more crowded if you don't already have an audience for kind of your individual profile or business profile. Network, like personal networks are always going to be the best if you have them, or the second best then becomes alumni basis. So, um, Reached out to a lot of alumni, both from my undergrad and then my MBA program as well. And then after that, it kind of comes to like, you know, less easy ways of either cold outreach, putting together marketing, doing a product hunt launch, just figuring out ways to find where your buyers are going to be. So we did some things in the early days of like, you know, sponsoring newsletters, getting in front of influencers within our segment that wound up being really good and pretty scalable early on, which was helpful as well.

AI assessment note: “personal networks are always going to be the best if you have them”

Q that's not easy to do, but you can still sell the business to someone that is okay with, you know, quote unquote lifestyle business or profitable business. So it's like a win-win. Uh, sale, partnership, exit. Um, love that. Tell me about your, your first week on acquire.com. You list, you go live, did it meet your expectations? Did a lot of buyers sign NDAs? What did that look like?

A Yeah, so we were pretty nervous going in, um, to how it would work, what it would be like. I think I was a little bit skeptical as well. Um, we had a call with one of your specialists, which was pretty good. She, she gave us the advice of just list a little bit low, almost like real estate, like list a little bit low, you'll get offers, and you, if While the listing's fresh and everyone sees it. So it's like, okay, we, we listed a little bit below the recommended amount, uh, and we wound up just getting inundated with buyers. And so we got a number of term sheets within the first week sight unseen people without even talking to us and put ourselves in a good competitive process where we ultimately close for a lot more than we listed for just because of how the competitive dynamics worked.

AI assessment note: “we wound up just getting inundated with buyers. And so we got a number”

Q Nice. So let's fast forward a little bit. So things are going really well. You have partnerships with QuickBooks. You're in the Microsoft App Store. Uh, you know, things are growing fast. What made you want to sell the business?

A I think we started to come to the realization that it wasn't necessarily going to be a venture-scale growth opportunity in the way that we originally thought it was, and so we started working on another product really focused on AI, and it became pretty obvious to us pretty quickly that AI for, you know, early-stage CFOs, the market wasn't there. They weren't going to be the right demographic, the right buyer for what we wanted to build, and so we had this product Genius sheets. And then we started working on a new product, which is ultimately my code that we're working on now. Uh, and so as we started building more of these AI features, we realized we still had this like valuable business that we were operating on the side, uh, and started to think through ways to monetize it really through ultimately selling it.

AI assessment note: “realization that it wasn't necessarily going to be a venture-scale growth opportunity”

Q Nice. I love that. Tell me about the calls with the buyers. Um, how did they go? Anything surprising? Um, were they all kind of the same, high level? Just like someone's listening, probably thinking, you know, when I get on the phone with a buyer, what do I say? What do I do? What can I expect? Um, any thoughts there?

A I think it varied depending on the type of buyer. So the buyers we talked to that had a really deep finance or accounting background really understood the product and who it was serving and who we were selling to. So there was much less questions around that and much more around like, what does usage look like? Like, what's your retention numbers? Like, going into all the nitty gritty of basically trying to find where There's hair on the deal or not, like trying to uncover those secrets for the people that really didn't have the subject matter expertise and were more just SAS buyers potentially interested. I think there was a lot more education upfront in like what this tool is, who it's for, how they would go about marketing it. And so pretty quickly we realized that there was a large enough concentrations finance buyers as people with a real subject matter expertise that that was probably gonna be a much better fit. To both take over the business and not have the hassle of us wondering, A, is it going to continue operating? But B, during that transition, they know exactly what they're getting and that we can be, like, feel good that we're giving it to somebody who gets it.

AI assessment note: “I think it varied depending on the type of buyer.”

Q Nice. Okay. So you find a buyer, everything was good in terms of the offer and the valuation and the terms you sign that you move into due diligence. How did that process go? How long did it take? Um, any hiccups, any surprises, any advice for people about to enter due diligence?

A I think just try and be as upfront as possible around everything that You're selling to the people when you're getting the offers, especially if you have multiple offers, it's better to be upfront and be like, hey, this is the deal, like not trying to hide anything due diligence. We were fortunate that we didn't run into that issue. What we ran into actually is because we're listed on the Microsoft app exchange. Microsoft makes it really, really, really hard to transfer that to another entity. Um, and so we wound up having a bit of a prolonged process because of Microsoft support and going back and forth Microsoft for almost two months. The rest of the diligence for us was very straightforward. I think we we had provided all the underlying documentation originally when we were going through the initial process and then we provide some access to our systems and other places once we had everything signed just to make sure that, you know, all the T's were crossed and I's were dotted. And so overall, I think the more information you put up front, it really helped on the back end of the diligence. There wasn't that much. It was a lot of like, let's transfer accounts and make sure like, When you tell us there are a hundred users here and for the segment that there are a hundred users.

AI assessment note: “prolonged process because of Microsoft support and going back and forth Microsoft for almost two months.”

Q Nice. And then you mentioned you received multiple offers from different buyers. How did you make that happen? Did you really prepare before going live and acquired? Did you have really good buyer calls? Did you, was it the pricing that you listed at? Like with someone that's saying, how do I receive multiple offers? How would you give advice for someone looking to looking to do the same?

A I think the biggest thing was the pricing. Like we, we definitely listed it a little bit low out of the recommendation rather than on the high side. Um, and we're, let's see, I'm very surprised on the upside of how many active people were on the platform to the point of like, I could have negotiated higher and kept the process going longer and gotten more out of it. I just, at this point was so busy with the other stuff. I needed to get it off my plate that we picked. Who we thought was the best buyer at the time on a price that we thought was fair and went through with it. And so we spent some time getting things ready. It wasn't, you know, not that much is required of it to get it into the process. And so that was really the biggest insight of, uh, really like listing it for something valuable. And we did one or two books or in the marketplace to see what else was there, if anything similar, just to have an understanding of kind of how we come to the rest of the market.

AI assessment note: “I think the biggest thing was the pricing. Like we, we definitely listed it a little bit low”