May 28, 2020 · 32m · top-founders
How to Acquire a $180k Revenue SaaS Company for $3k With Ryan Kulp
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
Entrepreneur Ryan Kulp shares how he acquired NotifyApp for just $3,000 upfront using seller financing, scaled it into FOMO.com generating nearly $100,000 in monthly recurring revenue, and built the micro-private equity firm Fork Equity.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Nathan holds 30.2% of the talking time here. How this is scored →
Nathan as informed peer 5.4 Guest teaching 4.4 Guest disagreement 3.1 Nathan pushing back 4.0
speaking balance: gold is Nathan, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 23:52 Guest dismisses host's excuse for IP copying
When Latka empathizes with copying terms of service to save legal fees, Kulp aggressively fires back that free generators exist and direct plagiarism is lazy and malicious.
Hardest push from Nathan ▶ 16:14 Host condemns lifetime SaaS dealsLatka directly attacks Kulp's strategy, calling lifetime plans in SaaS potentially the dumbest thing a founder can do unless entirely broke.
Biggest teaching moment ▶ 5:43 Guest explains zero-interest seller financing mechanicsKulp gives a masterclass on structuring a 100% upfront equity takeover with a failure clawback provision and zero bank debt.
Nathan holds their own ▶ 10:56 Host articulates deal price versus terms dynamicsLatka takes control of the dialogue to synthesize the financial engineering of the buyout, clearly demonstrating how favorable structuring trumps headline valuation.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Nathan as informed peer | Guest teaching | Guest disagreement | Nathan pushing back | Why |
|---|---|---|---|---|---|---|
| Podcast Promotion and GetLatka Platform Announcement | 4 | 2 | 1 | 2 | Latka introduces his platform and begins a collaborative biographical interview tracing Kulp's journey through various tech ventures. The dynamic is cordial and conversational as Latka establishes the timeline. | |
| Structuring the NotifyApp Buyout via Seller Financing | 5 | 7 | 2 | 3 | Kulp explains the detailed mechanics of seller financing and the clawback provision used to buy NotifyApp with almost no cash down. Latka asks clarifying questions about valuation ranges and ownership structures. | |
| Rebuilding FOMO Using Zero-Percent APR Credit Cards | 8 | 5 | 2 | 4 | Kulp details using zero-percent APR credit cards to finance development. Latka demonstrates strong financial acumen by summarizing the critical distinction between deal price and deal terms. | |
| The Fork Equity Thesis and the Solopreneur Inflection Point | 6 | 6 | 2 | 3 | Kulp outlines the Fork Equity thesis regarding the growth plateau faced by solo founders at 10k-20k MRR. Latka probes into the notification volume pricing model and enterprise tiers. | |
| Customer Milestones, Team Composition, and Lifetime Deals | 7 | 4 | 5 | 7 | Latka aggressively criticizes lifetime deals as the dumbest move in SaaS. Kulp pushes back, defending the move as customer acquisition for an ad network and funding for a company sailing retreat. | |
| Revenue Performance, Profit Focus, and Portfolio Expansion | 6 | 3 | 3 | 5 | Latka presses Kulp on flat recurring SaaS revenue over the prior twelve months. Kulp explains the deliberate strategic shift toward portfolio diversification and maximizing bottom-line profit over revenue growth. | |
| Competitive Rivalry and IP Disputes with Proof | 5 | 5 | 7 | 6 | Kulp launches into a fiery breakdown of competitor Proof stealing FOMO's terms of service and marketing assets. When Latka admits early-stage founders often copy legal templates to save cash, Kulp refutes the excuse by highlighting free open-source generators. | |
| The $105,000 Acquisition of the FOMO.com Domain | 4 | 6 | 2 | 3 | Kulp reveals paying $105,000 for the FOMO.com domain after tracking the prior owner's acquisition and rebranding. Latka notes with amusement that Kulp paid more cash for the domain than the initial cash invested in the software business. | |
| Fork Equity Capital Deployment and Exit Multiples | 6 | 4 | 6 | 5 | Latka tests Kulp on hypothetical buyout multiples and asks if he would sell to his competitor Proof. Kulp firmly sets his valuation expectations around unamortized IP assets and refuses to compromise on tech standards. | |
| Famous Five Rapid-Fire Questions | 3 | 2 | 1 | 2 | Latka runs through the rapid-fire Famous Five questions, touching on sleep schedules and Kulp's experience during civil unrest in Chile, before closing out the interview. |
Statements from this episode (17)
Marketing does not move the needle in enterprise software
“Marketing doesn't make a dent in, in enterprise software.”
Boutique marketing agencies ultimately do whatever clients pay them to do
“When you're an agency, you just do whatever people pay you to do. To be honest, people always say like, we're super focused on copywriting. It's like, no, you don't. You probably set up like Google analytics for people if they ask.”
NotifyApp was acquired via zero-interest seller financing matched to revenue
“So we did a structure like that without interest without outside financiers. The monthly payments were similar to the revenue. We were able to grow it just above board of our monthly service payments. And then we introduced a clawback provision Such that if tw…”
FOMO's product rebuild was financed with an $80k zero-APR credit card
“We just got a Chase credit card, 12 months, zero percent APR interest, and I think we put, like, 70 or 80 G's On that card. And then like month 10 of the of the accrual, we paid that off in full. So again, paid no interest and essentially did like a 80,000 dol…”
NotifyApp was generating $15,000 in monthly revenue at acquisition
“No, it was actually around 15 K.”
Solo founders need $30k MRR with employees to match $10k solo profit
“Once you're at 15 KMRR and you hire even a couple of part-time developer support, now you're down to like five KMRR take home. And so it's this hedonic treadmill of like, you need to get to 25 or 30 KMRR with employees to make the same amount of money as 10 KM…”
Fork Equity scales $10k MRR acquisitions using a shared services team
“With us, because we can get some economies of scale, having a shared team, a centralized team of developers, marketers, and so on, it's like not a big deal to tag on a business at 10 KMRR. We can inject three K worth of development and support and design and e…”
FOMO has over 5,000 customers including lifetime accounts
“5055 hundred. Yeah, there's a few hundred that are on a lifetime deal, so I don't know if you want to count those.”
Lifetime SaaS deals are the dumbest move unless a company is broke
“I think selling lifetime plans in a SaaS business is potentially the dumbest thing you can do unless you're just totally broke and you're trying to fund some development.”
FOMO peaked at $154k monthly revenue and generates just under $100k MRR
“It's just below a hundred. Our best month we did one 54. That was with the lifetime deal. Our best recurring only revenue month was like one 11.”
FOMO revenue stayed flat while cutting team from 12 full-time staff
“Yes, so the revenue at FOMO is, has been flat for a while, but our team was 12 people full-time at this time last year.”
Fork Equity generates roughly $1.6M per year in portfolio top-line revenue
“That's right. Around one point, yeah, around 1.6 a year.”
Fork Equity's course generates $7k to $8k monthly with near-zero effort
“Now this course has become its own portfolio project that makes seven, eight K a month. And we don't do anything, you know, like someone says, can you give me the spreadsheet template? That's our support. There's no bugs. There's no sales.”
Competitor Proof copied FOMO's entire terms of service word for word
“Proof, like copy pasted our entire terms of service word for word.”
Competitor Proof ran Facebook ads featuring FOMO's customers and product
“Some of the other things they've done are like made advertised promotional videos with our customers in it, and then put tens of thousands on Facebook ads to promoting these videos. And if you watch the video, it's talking about proof, but in the video is our …”
FOMO.com was acquired for $105,000 using 10% debt from private connections
“We actually used debt to buy the FOMO.com domain. So we had the cash in the bank at the time, but I wanted to hire some new employees. I hired a marketer, hired a sales, this debt person, and I didn't want to blow it all on this.com. That was definitely just f…”
FOMO.com's domain and IP add at least $1M to an exit valuation
“I think the FOMO.com domain has a lot more value than the 105 K we paid for it. So I think the right buyer kind of would be willing to itemize to some degree. Here's the EBITDA. Here's the multiple on that. Here's your 50 trademarks and copyrights, and here's …”