Which Business Buyers Will Pay the MOST for YOUR Business

Selling companies has made me more money Selling companies has made me more money than real estate, crypto, and the stock than real estate, crypto, and the stock than real estate, crypto, and the stock market combined. But here's what most market combined. But here's what most market combined. But here's what most founders don't realize. Finding the founders don't realize. Finding the founders don't realize. Finding the right buyer isn't just about getting a right buyer isn't just about getting a right buyer isn't just about getting a sale. It's about maximizing the value of sale. It's about maximizing the value of sale. It's about maximizing the value of your life's work. I'm Rob Walling, and your life's work. I'm Rob Walling, and your life's work. I'm Rob Walling, and I've been on both sides of acquisitions. I've been on both sides of acquisitions. I've been on both sides of acquisitions. I've bought and sold multiple SAS I've bought and sold multiple SAS I've bought and sold multiple SAS companies and helped countless founders companies and helped countless founders companies and helped countless founders navigate their exits. Most founders navigate their exits. Most founders navigate their exits. Most founders approach selling their company approach selling their company approach selling their company completely backward. They wait until completely backward. They wait until completely backward. They wait until they're burned out, take the first they're burned out, take the first they're burned out, take the first decent offer that comes along, and decent offer that comes along, and decent offer that comes along, and sometimes leave literally millions on sometimes leave literally millions on sometimes leave literally millions on the table. In the next few minutes, I'll the table. In the next few minutes, I'll the table. In the next few minutes, I'll reveal the six distinct types of buyers reveal the six distinct types of buyers reveal the six distinct types of buyers looking for businesses just like yours looking for businesses just like yours looking for businesses just like yours right now. Each type has different right now. Each type has different right now. Each type has different motivations, different checkbooks, and motivations, different checkbooks, and motivations, different checkbooks, and radically different approaches to radically different approaches to radically different approaches to valuing what you've built. You'll valuing what you've built. You'll valuing what you've built. You'll discover which buyers will pay premium discover which buyers will pay premium discover which buyers will pay premium prices for your specific business model, prices for your specific business model, prices for your specific business model, the hidden psychological triggers that the hidden psychological triggers that the hidden psychological triggers that make them open their wallets wider, and make them open their wallets wider, and make them open their wallets wider, and exactly where to find them when you're exactly where to find them when you're exactly where to find them when you're ready to exit. And if you're interested ready to exit. And if you're interested ready to exit. And if you're interested in diving deeper into this topic, this in diving deeper into this topic, this in diving deeper into this topic, this video is essentially an excerpt from my video is essentially an excerpt from my video is essentially an excerpt from my new book, Exit Strategy, that you can new book, Exit Strategy, that you can new book, Exit Strategy, that you can get on Amazon, Audible, or at get on Amazon, Audible, or at get on Amazon, Audible, or at exitstrategybook.com. To kick us off, as exitstrategybook.com. To kick us off, as exitstrategybook.com. To kick us off, as I said, there are six types of buyers, I said, there are six types of buyers, I said, there are six types of buyers, and I'm going to go through them in and I'm going to go through them in and I'm going to go through them in order by who typically pays the most to order by who typically pays the most to order by who typically pays the most to the least. So, the first, which is the least. So, the first, which is the least. So, the first, which is strategic buyers, typically will pay the strategic buyers, typically will pay the strategic buyers, typically will pay the most. And by the time I get to the sixth most. And by the time I get to the sixth most. And by the time I get to the sixth one, those are usually the lowest one, those are usually the lowest one, those are usually the lowest multiples on your revenue or profit. So multiples on your revenue or profit. So multiples on your revenue or profit. So a strategic buyer is usually a company a strategic buyer is usually a company a strategic buyer is usually a company in your space that wants to acquire your in your space that wants to acquire your in your space that wants to acquire your business for a specific reason. So you business for a specific reason. So you business for a specific reason. So you might have a product that's might have a product that's might have a product that's complimentary to theirs. For example, if complimentary to theirs. For example, if complimentary to theirs. For example, if you started a tiny email service

you started a tiny email service you started a tiny email service provider, a larger one might buy you. Or provider, a larger one might buy you. Or provider, a larger one might buy you. Or if you have a platform specific software if you have a platform specific software if you have a platform specific software application, the platform itself might application, the platform itself might application, the platform itself might decide to acquire it. And there's decide to acquire it. And there's decide to acquire it. And there's actually a common misconception that actually a common misconception that actually a common misconception that most acquisitions are strategic. And most acquisitions are strategic. And most acquisitions are strategic. And that is not the case. According to my that is not the case. According to my that is not the case. According to my experience and the experience of us at experience and the experience of us at experience and the experience of us at Tiny Seed, having invested in almost 200 Tiny Seed, having invested in almost 200 Tiny Seed, having invested in almost 200 SAS companies. Now, this video isn't SAS companies. Now, this video isn't SAS companies. Now, this video isn't just about software as a service just about software as a service just about software as a service companies selling, it applies to any companies selling, it applies to any companies selling, it applies to any business type that you can imagine, from business type that you can imagine, from business type that you can imagine, from brickandmortars to online only to brickandmortars to online only to brickandmortars to online only to e-commerce to SAS companies, but e-commerce to SAS companies, but e-commerce to SAS companies, but especially within SAS, which I can speak especially within SAS, which I can speak especially within SAS, which I can speak to, about 80% of acquisitions that we to, about 80% of acquisitions that we to, about 80% of acquisitions that we see once companies are doing at least $2 see once companies are doing at least $2 see once companies are doing at least $2 million in ARR, about 80% of them are million in ARR, about 80% of them are million in ARR, about 80% of them are done actually by private equity. And done actually by private equity. And done actually by private equity. And there's only 1/5if about 20% that tend there's only 1/5if about 20% that tend there's only 1/5if about 20% that tend to be done by strategic acquirers. Now to be done by strategic acquirers. Now to be done by strategic acquirers. Now in other spaces that might be different. in other spaces that might be different. in other spaces that might be different. If you started Dollar Shave Club, the If you started Dollar Shave Club, the If you started Dollar Shave Club, the odds of private equity buying that are odds of private equity buying that are odds of private equity buying that are probably less than if it was a SAS probably less than if it was a SAS probably less than if it was a SAS company, but a company like say company, but a company like say company, but a company like say Gillette, which I believe is who bought Gillette, which I believe is who bought Gillette, which I believe is who bought Dollar Shave Club for a billion dollars, Dollar Shave Club for a billion dollars, Dollar Shave Club for a billion dollars, that becomes a more likely thing. So the that becomes a more likely thing. So the that becomes a more likely thing. So the upside of this type of sale is that upside of this type of sale is that upside of this type of sale is that strategics tend to pay the highest strategics tend to pay the highest strategics tend to pay the highest multiple. And these are directionally multiple. And these are directionally multiple. And these are directionally correct, right? I'm sure we can find one correct, right? I'm sure we can find one correct, right? I'm sure we can find one private equity exit, which that's number private equity exit, which that's number private equity exit, which that's number two that I'm about to step into. One two that I'm about to step into. One two that I'm about to step into. One private equity exit that's more higher private equity exit that's more higher private equity exit that's more higher multiple than a strategic exit, but in multiple than a strategic exit, but in multiple than a strategic exit, but in general, directionally correct general, directionally correct general, directionally correct strategics pay the most. So, the upside strategics pay the most. So, the upside strategics pay the most. So, the upside is that they pay the most and sometimes is that they pay the most and sometimes is that they pay the most and sometimes they keep your staff on so they don't they keep your staff on so they don't they keep your staff on so they don't dismantle the business and, you know,

dismantle the business and, you know, dismantle the business and, you know, really kind of screw up your legacy. Um, really kind of screw up your legacy. Um, really kind of screw up your legacy. Um, the interesting part about strategics is the interesting part about strategics is the interesting part about strategics is they aren't going to mess around with they aren't going to mess around with they aren't going to mess around with tiny acquisitions. uh they might do aqua tiny acquisitions. uh they might do aqua tiny acquisitions. uh they might do aqua hires, which really isn't the scope of hires, which really isn't the scope of hires, which really isn't the scope of of this video. An aqua hire is where of this video. An aqua hire is where of this video. An aqua hire is where they kind of pay you almost like a they kind of pay you almost like a they kind of pay you almost like a signing bonus to shut down your company. signing bonus to shut down your company. signing bonus to shut down your company. They shut the tech down and they take They shut the tech down and they take They shut the tech down and they take over you and or your team and you get a over you and or your team and you get a over you and or your team and you get a bunch of stock, sometimes a small amount bunch of stock, sometimes a small amount bunch of stock, sometimes a small amount of cash. But I'm talking about truly of cash. But I'm talking about truly of cash. But I'm talking about truly selling for amazing sums, six, seven, selling for amazing sums, six, seven, selling for amazing sums, six, seven, eight figure, maybe even nine figure eight figure, maybe even nine figure eight figure, maybe even nine figure sums. And for those types of exits, when sums. And for those types of exits, when sums. And for those types of exits, when a strategic comes a knocking, they don't a strategic comes a knocking, they don't a strategic comes a knocking, they don't want to buy a business that's doing half want to buy a business that's doing half want to buy a business that's doing half a million a year. It's just not worth a million a year. It's just not worth a million a year. It's just not worth their time. They want businesses doing their time. They want businesses doing their time. They want businesses doing millions or tens of millions a year. And millions or tens of millions a year. And millions or tens of millions a year. And they typically don't want to acquire they typically don't want to acquire they typically don't want to acquire just the tech. The team is as valuable just the tech. The team is as valuable just the tech. The team is as valuable to them as the tech. So buyer type to them as the tech. So buyer type to them as the tech. So buyer type number two is private equity. And number two is private equity. And number two is private equity. And private equity investors are private private equity investors are private private equity investors are private pools of capital that buy and manage pools of capital that buy and manage pools of capital that buy and manage businesses according to a relatively businesses according to a relatively businesses according to a relatively standard playbook where the goal is to standard playbook where the goal is to standard playbook where the goal is to grow the business three to five times grow the business three to five times grow the business three to five times within three to five years and often within three to five years and often within three to five years and often then they flip it. These types of then they flip it. These types of then they flip it. These types of investors generally specialize in buying investors generally specialize in buying investors generally specialize in buying whole companies or sometimes in minority whole companies or sometimes in minority whole companies or sometimes in minority investments where they purchase investments where they purchase investments where they purchase secondary shares from the founders. The secondary shares from the founders. The secondary shares from the founders. The upside of this type of sale is there are upside of this type of sale is there are upside of this type of sale is there are a lot of private equity companies and a lot of private equity companies and a lot of private equity companies and there's a lot of money flowing into there's a lot of money flowing into there's a lot of money flowing into businesses by private equity. So they're businesses by private equity. So they're businesses by private equity. So they're relatively common. One of the downsides relatively common. One of the downsides relatively common. One of the downsides is that sometimes private equity can do is that sometimes private equity can do is that sometimes private equity can do financial engineering and so they will financial engineering and so they will financial engineering and so they will often try to lay off your whole staff or often try to lay off your whole staff or often try to lay off your whole staff or you kind of take it down to the bone to you kind of take it down to the bone to you kind of take it down to the bone to make it extremely profitable. It it make it extremely profitable. It it make it extremely profitable. It it depends. Some really want to grow it and depends. Some really want to grow it and depends. Some really want to grow it and then there are value private equity

then there are value private equity then there are value private equity buyers that will really strip the buyers that will really strip the buyers that will really strip the business down to a place where you might business down to a place where you might business down to a place where you might not recognize it anymore. And typically not recognize it anymore. And typically not recognize it anymore. And typically private equity has dipped down. I mean private equity has dipped down. I mean private equity has dipped down. I mean gez 10 years ago they weren't buying gez 10 years ago they weren't buying gez 10 years ago they weren't buying anything south of 10 million or $5 anything south of 10 million or $5 anything south of 10 million or $5 million a year in revenue. they've million a year in revenue. they've million a year in revenue. they've dipped down to where at one point they dipped down to where at one point they dipped down to where at one point they were buying stuff at once you hit a were buying stuff at once you hit a were buying stuff at once you hit a million they would consider it but since million they would consider it but since million they would consider it but since the kind of the funding dip in 2022 and the kind of the funding dip in 2022 and the kind of the funding dip in 2022 and 2023 it seems like it's about 2 million 2023 it seems like it's about 2 million 2023 it seems like it's about 2 million and up give or take that private equity and up give or take that private equity and up give or take that private equity uh might be interested in. So if you uh might be interested in. So if you uh might be interested in. So if you have a a company that's doing half a have a a company that's doing half a have a a company that's doing half a million a year the odds of private million a year the odds of private million a year the odds of private equity buying from you are pretty low. equity buying from you are pretty low. equity buying from you are pretty low. The third type of buyer is a search The third type of buyer is a search The third type of buyer is a search fund. So this is where a recent MBA fund. So this is where a recent MBA fund. So this is where a recent MBA graduate raises private capital to buy graduate raises private capital to buy graduate raises private capital to buy and operate a company. The individual and operate a company. The individual and operate a company. The individual might be self-funded or might be backed might be self-funded or might be backed might be self-funded or might be backed by investors. And the goal is acquiring by investors. And the goal is acquiring by investors. And the goal is acquiring a business and stepping in as the CEO a business and stepping in as the CEO a business and stepping in as the CEO and running it. So search funds often and running it. So search funds often and running it. So search funds often buy companies that are too small for buy companies that are too small for buy companies that are too small for private equity. As I said before, private equity. As I said before, private equity. As I said before, private equity, you know, they want to private equity, you know, they want to private equity, you know, they want to be efficient with their time. So they be efficient with their time. So they be efficient with their time. So they prefer to do deals for companies that prefer to do deals for companies that prefer to do deals for companies that are doing 10, 20, $30 million a year, are doing 10, 20, $30 million a year, are doing 10, 20, $30 million a year, but they'll dip down to five or but they'll dip down to five or but they'll dip down to five or sometimes to two if the growth is there.

sometimes to two if the growth is there. sometimes to two if the growth is there. But search funds can go even smaller But search funds can go even smaller But search funds can go even smaller than that cuz they're one-off deals. And than that cuz they're one-off deals. And than that cuz they're one-off deals. And search funds tend to target service search funds tend to target service search funds tend to target service businesses, manufacturing, and other businesses, manufacturing, and other businesses, manufacturing, and other companies outside of the high-tech companies outside of the high-tech companies outside of the high-tech space. So, the reason you might sell to space. So, the reason you might sell to space. So, the reason you might sell to a search fund is if you're not in the a search fund is if you're not in the a search fund is if you're not in the high-tech space, which usually is where high-tech space, which usually is where high-tech space, which usually is where a lot of private equity wants to be, or a lot of private equity wants to be, or a lot of private equity wants to be, or if you are too small for a private if you are too small for a private if you are too small for a private equity or a strategic exit. The fourth equity or a strategic exit. The fourth equity or a strategic exit. The fourth type of buyer are high- netw worth type of buyer are high- netw worth type of buyer are high- netw worth individuals. And when we wrote exit individuals. And when we wrote exit individuals. And when we wrote exit strategy, I actually interviewed Breck strategy, I actually interviewed Breck strategy, I actually interviewed Breck Palumbo. He's an M&A adviser with Palumbo. He's an M&A adviser with Palumbo. He's an M&A adviser with International Business Associates. and International Business Associates. and International Business Associates. and he works with owners of brickandmortar he works with owners of brickandmortar he works with owners of brickandmortar companies ranging from $1 to $50 million companies ranging from $1 to $50 million companies ranging from $1 to $50 million in revenue. He's found that the majority in revenue. He's found that the majority in revenue. He's found that the majority of inquiries for these types of of inquiries for these types of of inquiries for these types of businesses are high netw worth businesses are high netw worth businesses are high netw worth individuals. And to quote Breck, he individuals. And to quote Breck, he individuals. And to quote Breck, he said, "A very common buyer profile is an said, "A very common buyer profile is an said, "A very common buyer profile is an executive in their late 40s or 50s who's executive in their late 40s or 50s who's executive in their late 40s or 50s who's been making about $300,000 a year, has 2 been making about $300,000 a year, has 2 been making about $300,000 a year, has 2 to5 million in savings, and will use 90% to5 million in savings, and will use 90% to5 million in savings, and will use 90% SBA debt, that's small business SBA debt, that's small business SBA debt, that's small business administration if they're in the US, to administration if they're in the US, to administration if they're in the US, to buy a cash flowing business in the $1 buy a cash flowing business in the $1 buy a cash flowing business in the $1 to5 million range." And so the upside of to5 million range." And so the upside of to5 million range." And so the upside of this type of sale is that high net worth this type of sale is that high net worth this type of sale is that high net worth individuals will likely buy businesses individuals will likely buy businesses individuals will likely buy businesses that the others will pass on. You know, that the others will pass on. You know, that the others will pass on. You know, in in a perfect world, every exit would in in a perfect world, every exit would in in a perfect world, every exit would be strategic because you're going to get be strategic because you're going to get be strategic because you're going to get the highest ARR multiple. But the highest ARR multiple. But the highest ARR multiple. But realistically, not everyone can sell to realistically, not everyone can sell to realistically, not everyone can sell to a strategic or private equity. Now, the a strategic or private equity. Now, the a strategic or private equity. Now, the fifth entity that you can sell your fifth entity that you can sell your fifth entity that you can sell your business to are your co-founders. And business to are your co-founders. And business to are your co-founders. And usually this happens if a business usually this happens if a business usually this happens if a business either stops growing and everyone's kind either stops growing and everyone's kind either stops growing and everyone's kind of wondering what to do with it or if a of wondering what to do with it or if a of wondering what to do with it or if a co-founder has a life change that

co-founder has a life change that co-founder has a life change that happens. Let's say they get married or happens. Let's say they get married or happens. Let's say they get married or divorced or they have a child or there's divorced or they have a child or there's divorced or they have a child or there's some other dramatic shift and they don't some other dramatic shift and they don't some other dramatic shift and they don't want to work on the business anymore, want to work on the business anymore, want to work on the business anymore, but you don't want to leave your but you don't want to leave your but you don't want to leave your co-founders working on the business and co-founders working on the business and co-founders working on the business and basically kind of putting money in your basically kind of putting money in your basically kind of putting money in your pocket, putting that growth in your pocket, putting that growth in your pocket, putting that growth in your pocket. And so co-founders will not pocket. And so co-founders will not pocket. And so co-founders will not infrequently have this conversation of infrequently have this conversation of infrequently have this conversation of what does it look like to buy another what does it look like to buy another what does it look like to buy another co-founder out. So the motivation is co-founder out. So the motivation is co-founder out. So the motivation is usually someone is moving on or has usually someone is moving on or has usually someone is moving on or has moved on. They're either tired of the moved on. They're either tired of the moved on. They're either tired of the business or it's a life change. Usually business or it's a life change. Usually business or it's a life change. Usually these are not valued at top dollar these are not valued at top dollar these are not valued at top dollar because someone's basically cashing out because someone's basically cashing out because someone's basically cashing out their shares. And so if you could their shares. And so if you could their shares. And so if you could traditionally sell the business for five traditionally sell the business for five traditionally sell the business for five times net profit, maybe you discount times net profit, maybe you discount times net profit, maybe you discount that down to two or three because one of that down to two or three because one of that down to two or three because one of the co-founders is essentially coming up the co-founders is essentially coming up the co-founders is essentially coming up with cash or pulling money out of the with cash or pulling money out of the with cash or pulling money out of the business over time to buy out the other business over time to buy out the other business over time to buy out the other co-founder. And the sixth type of buyer co-founder. And the sixth type of buyer co-founder. And the sixth type of buyer is your network, your customers or your is your network, your customers or your is your network, your customers or your employees. And usually when I see folks employees. And usually when I see folks employees. And usually when I see folks doing this, these are for doing this, these are for doing this, these are for brickandmortars often for small brickandmortars often for small brickandmortars often for small franchises or franchises or franchises or multi-loation brick and mortars like say multi-loation brick and mortars like say multi-loation brick and mortars like say a trapeze club that has several trapeze a trapeze club that has several trapeze a trapeze club that has several trapeze rigs all around the country or I can rigs all around the country or I can rigs all around the country or I can imagine a fast food chain that is all imagine a fast food chain that is all imagine a fast food chain that is all owned by you know one entity wanting to owned by you know one entity wanting to owned by you know one entity wanting to just sell it off to the managers. And just sell it off to the managers. And just sell it off to the managers. And since often you are selling to customers since often you are selling to customers since often you are selling to customers or employees who may not have as much or employees who may not have as much or employees who may not have as much money or as much credit or the ability money or as much credit or the ability money or as much credit or the ability to borrow money to purchase these assets to borrow money to purchase these assets to borrow money to purchase these assets in essence and you're kind of splitting in essence and you're kind of splitting in essence and you're kind of splitting one business into a lot of smaller one business into a lot of smaller one business into a lot of smaller businesses is is often the way it goes.

businesses is is often the way it goes. businesses is is often the way it goes. These deal sizes can be frankly almost These deal sizes can be frankly almost These deal sizes can be frankly almost any size, but they usually are going to any size, but they usually are going to any size, but they usually are going to be smaller because if you could sell it be smaller because if you could sell it be smaller because if you could sell it to private equity or strategic and if it to private equity or strategic and if it to private equity or strategic and if it had a lot of value, that's typically the had a lot of value, that's typically the had a lot of value, that's typically the path that you would travel. Before we path that you would travel. Before we path that you would travel. Before we talk about how you find any of these talk about how you find any of these talk about how you find any of these types of buyers, if you're finding this types of buyers, if you're finding this types of buyers, if you're finding this video valuable, hit the like and video valuable, hit the like and video valuable, hit the like and subscribe. I'm shipping actionable subscribe. I'm shipping actionable subscribe. I'm shipping actionable content for founders like you every content for founders like you every content for founders like you every other week. And we are getting close to other week. And we are getting close to other week. And we are getting close to that 100,000 subscriber milestone. So, that 100,000 subscriber milestone. So, that 100,000 subscriber milestone. So, the next question is, how do you find the next question is, how do you find the next question is, how do you find these different types of buyers? Well, these different types of buyers? Well, these different types of buyers? Well, obviously, if it's your network, obviously, if it's your network, obviously, if it's your network, customers or employees, you would reach customers or employees, you would reach customers or employees, you would reach out to them and communicate the idea out to them and communicate the idea out to them and communicate the idea that you want to sell the business. You that you want to sell the business. You that you want to sell the business. You might hire an adviser. You might just might hire an adviser. You might just might hire an adviser. You might just hire an attorney and see if you know hire an attorney and see if you know hire an attorney and see if you know they're willing to do it. Co-founders is they're willing to do it. Co-founders is they're willing to do it. Co-founders is a similar situation. and you don't have a similar situation. and you don't have a similar situation. and you don't have to go outside of your network for that. to go outside of your network for that. to go outside of your network for that. But for the other four types, there are But for the other four types, there are But for the other four types, there are really four options. One of those is one really four options. One of those is one really four options. One of those is one that you don't control. It's inbound that you don't control. It's inbound that you don't control. It's inbound interest. And this is when private interest. And this is when private interest. And this is when private equity reaches out to you, when a equity reaches out to you, when a equity reaches out to you, when a strategic reaches out to you, when a strategic reaches out to you, when a strategic reaches out to you, when a high net worth individual reaches out or high net worth individual reaches out or high net worth individual reaches out or a search fund. You're getting inbound a search fund. You're getting inbound a search fund. You're getting inbound interest. And in that case, you can interest. And in that case, you can interest. And in that case, you can decide to field that interest to decide to field that interest to decide to field that interest to respond. Or you could even take that respond. Or you could even take that respond. Or you could even take that inbound interest, do the call, and say, inbound interest, do the call, and say, inbound interest, do the call, and say, "Hey, I'm not ready to sell right now, "Hey, I'm not ready to sell right now, "Hey, I'm not ready to sell right now, but when I am, I will circle back with but when I am, I will circle back with but when I am, I will circle back with you." And I actually know one founder you." And I actually know one founder you." And I actually know one founder who collected 20 or 30 of these folks who collected 20 or 30 of these folks who collected 20 or 30 of these folks who were interested in the business, who were interested in the business, who were interested in the business, kept them in a spreadsheet that when it kept them in a spreadsheet that when it kept them in a spreadsheet that when it was time to sell, not only reached back was time to sell, not only reached back was time to sell, not only reached back out to them, but then ran a full process out to them, but then ran a full process out to them, but then ran a full process with an M&A advisor, it was discretion with an M&A advisor, it was discretion with an M&A advisor, it was discretion capital at discretion capital.com and capital at discretion capital.com and capital at discretion capital.com and then reached out to another 100 150 then reached out to another 100 150 then reached out to another 100 150 private equity and strategic buyers and private equity and strategic buyers and private equity and strategic buyers and ran a full process. So that was inbound.

ran a full process. So that was inbound. ran a full process. So that was inbound. Another option, and this is usually when Another option, and this is usually when Another option, and this is usually when you're doing again 2 million and up in you're doing again 2 million and up in you're doing again 2 million and up in annual recurring revenue, is you hire annual recurring revenue, is you hire annual recurring revenue, is you hire your a broker, also known as an your a broker, also known as an your a broker, also known as an investment banker or an M&A firm, and I investment banker or an M&A firm, and I investment banker or an M&A firm, and I already mentioned Discretion Capital already mentioned Discretion Capital already mentioned Discretion Capital because I'm familiar with them. They because I'm familiar with them. They because I'm familiar with them. They represent a lot of our tiny seed represent a lot of our tiny seed represent a lot of our tiny seed companies that exit. They focus on B2B companies that exit. They focus on B2B companies that exit. They focus on B2B SAS, helping founders exit between 2 and SAS, helping founders exit between 2 and SAS, helping founders exit between 2 and 20 million ARR. And the broker, 20 million ARR. And the broker, 20 million ARR. And the broker, investment maker, M&A firm. These are investment maker, M&A firm. These are investment maker, M&A firm. These are kind of interchangeable terms. cuz kind of interchangeable terms. cuz kind of interchangeable terms. cuz they're not exactly identical, but they're not exactly identical, but they're not exactly identical, but you'll hear that term used relatively you'll hear that term used relatively you'll hear that term used relatively interchangeably. And if you want to run interchangeably. And if you want to run interchangeably. And if you want to run a process, which is kind of like just an a process, which is kind of like just an a process, which is kind of like just an auction, you go to, you know, the auction, you go to, you know, the auction, you go to, you know, the broker, as the investment maker, and broker, as the investment maker, and broker, as the investment maker, and they basically do outbound outreach to they basically do outbound outreach to they basically do outbound outreach to their network of buyers, and their their network of buyers, and their their network of buyers, and their network of buyers will be strategics, network of buyers will be strategics, network of buyers will be strategics, and it will be private equity. And if and it will be private equity. And if and it will be private equity. And if you have inbound, they'll mix that in you have inbound, they'll mix that in you have inbound, they'll mix that in and they will take offers in the form of and they will take offers in the form of and they will take offers in the form of letters of intent. And hopefully you get letters of intent. And hopefully you get letters of intent. And hopefully you get three, four, five offers. You can three, four, five offers. You can three, four, five offers. You can compare, you can get them to negotiate compare, you can get them to negotiate compare, you can get them to negotiate against each other. You sign the best against each other. You sign the best against each other. You sign the best one and you complete the deal. But one and you complete the deal. But one and you complete the deal. But again, these are for larger deals that again, these are for larger deals that again, these are for larger deals that are going to be certainly deep into are going to be certainly deep into are going to be certainly deep into seven figures and more likely into the seven figures and more likely into the seven figures and more likely into the eight or nine figure range. The third eight or nine figure range. The third eight or nine figure range. The third option is an online broker. And so there option is an online broker. And so there option is an online broker. And so there are brokerages, for example, like are brokerages, for example, like are brokerages, for example, like quietlite.com that helps small SAS, quietlite.com that helps small SAS, quietlite.com that helps small SAS, e-commerce, content websites. You know, e-commerce, content websites. You know, e-commerce, content websites. You know, a lot of online businesses sell. and a lot of online businesses sell. and a lot of online businesses sell. and they have a list of, you know, I don't they have a list of, you know, I don't they have a list of, you know, I don't know if I were to guess, 20, 30, 40,000 know if I were to guess, 20, 30, 40,000 know if I were to guess, 20, 30, 40,000 potential buyers on email lists. And potential buyers on email lists. And potential buyers on email lists. And those folks on that list are likely high

those folks on that list are likely high those folks on that list are likely high net worth individuals, could potentially net worth individuals, could potentially net worth individuals, could potentially be search funds or someone, you know, be search funds or someone, you know, be search funds or someone, you know, looking to buy an online business. And looking to buy an online business. And looking to buy an online business. And the reason you might go with this type the reason you might go with this type the reason you might go with this type of online broker is if your business of online broker is if your business of online broker is if your business isn't large enough to go to private isn't large enough to go to private isn't large enough to go to private equity or strategics. And there are a equity or strategics. And there are a equity or strategics. And there are a lot of businesses that are doing a h lot of businesses that are doing a h lot of businesses that are doing a h 100,000 35 $700,000 a year that are 100,000 35 $700,000 a year that are 100,000 35 $700,000 a year that are valuable but are not going to be worth valuable but are not going to be worth valuable but are not going to be worth the time of a large acquirer. And the the time of a large acquirer. And the the time of a large acquirer. And the fourth and final option that we've seen fourth and final option that we've seen fourth and final option that we've seen crop up well over the past decade really crop up well over the past decade really crop up well over the past decade really are these online marketplaces. And the are these online marketplaces. And the are these online marketplaces. And the two biggest ones that I know of are two biggest ones that I know of are two biggest ones that I know of are acquirer.com and acquirer.com and acquirer.com and flippa.com. And these are places where flippa.com. And these are places where flippa.com. And these are places where you essentially are listing it. it's for you essentially are listing it. it's for you essentially are listing it. it's for sale by owner and you're listing it for sale by owner and you're listing it for sale by owner and you're listing it for a price and then you field the inquiries a price and then you field the inquiries a price and then you field the inquiries and you basically handle most of the and you basically handle most of the and you basically handle most of the sale by yourself. And I would think sale by yourself. And I would think sale by yourself. And I would think about going here if I really knew what I about going here if I really knew what I about going here if I really knew what I was doing as a seller, probably if I'd was doing as a seller, probably if I'd was doing as a seller, probably if I'd sold businesses in the past or if the sold businesses in the past or if the sold businesses in the past or if the business was so small that one of the business was so small that one of the business was so small that one of the online brokers wouldn't handle it. So if online brokers wouldn't handle it. So if online brokers wouldn't handle it. So if something was doing $25,000 a year or something was doing $25,000 a year or something was doing $25,000 a year or $50,000 a year, I don't know of an $50,000 a year, I don't know of an $50,000 a year, I don't know of an online broker that's going to deal with online broker that's going to deal with online broker that's going to deal with that. Um, but you could feasibly go to that. Um, but you could feasibly go to that. Um, but you could feasibly go to one of the online marketplaces. And you one of the online marketplaces. And you one of the online marketplaces. And you know, as I said above, if you sell to know, as I said above, if you sell to know, as I said above, if you sell to private equity or to strategics, private equity or to strategics, private equity or to strategics, usually, I mean, it depends, but the usually, I mean, it depends, but the usually, I mean, it depends, but the whole company's going with it. They whole company's going with it. They whole company's going with it. They often want the team to continue working often want the team to continue working often want the team to continue working on it. When you go through online on it. When you go through online on it. When you go through online brokers and marketplaces, often times brokers and marketplaces, often times brokers and marketplaces, often times you're just selling a piece of it.

you're just selling a piece of it. you're just selling a piece of it. You're just selling the technology. For You're just selling the technology. For You're just selling the technology. For example, if you have an e-commerce example, if you have an e-commerce example, if you have an e-commerce website, you're not going with it to to website, you're not going with it to to website, you're not going with it to to continue working on it, right? If you continue working on it, right? If you continue working on it, right? If you sell a small SAS app, you're not going sell a small SAS app, you're not going sell a small SAS app, you're not going to continue working on that. They are to continue working on that. They are to continue working on that. They are just acquiring the technology. Once you just acquiring the technology. Once you just acquiring the technology. Once you have a potential buyer, the next step, have a potential buyer, the next step, have a potential buyer, the next step, of course, is to get an LOI, a letter of of course, is to get an LOI, a letter of of course, is to get an LOI, a letter of intent. And I talk a lot more about the intent. And I talk a lot more about the intent. And I talk a lot more about the full process of selling your business in full process of selling your business in full process of selling your business in my new book, Exit Strategy. You can get my new book, Exit Strategy. You can get my new book, Exit Strategy. You can get a copy on Amazon, can listen on Audible, a copy on Amazon, can listen on Audible, a copy on Amazon, can listen on Audible, and you can get a free chapter of the and you can get a free chapter of the and you can get a free chapter of the book at book at book at exitstrategybook.com. Are you thinking exitstrategybook.com. Are you thinking exitstrategybook.com. Are you thinking about putting your business up for sale? about putting your business up for sale? about putting your business up for sale? After working with thousands of After working with thousands of After working with thousands of founders, I can tell you that timing is founders, I can tell you that timing is founders, I can tell you that timing is everything. Check out this next video on everything. Check out this next video on everything. Check out this next video on the nine signs it's time to sell your the nine signs it's time to sell your the nine signs it's time to sell your company, including a few company, including a few company, including a few counterintuitive ones I learned the hard counterintuitive ones I learned the hard counterintuitive ones I learned the hard way after selling multiple businesses. way after selling multiple businesses. way after selling multiple businesses. Thanks for watching. We'll see you next Thanks for watching. We'll see you next Thanks for watching. We'll see you next time.