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May 18, 2016 |
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Dennis Hart sold his advertising agency for 7.1X. That sounds like a great exit but it disguises the complexity of the negotiations. Hart felt like he knew precisely how much EBITDA he generated until the buyer started questioning his math.
Hart walked away from the negotiating table twice. Eventually both parties were able to agree on a set of “add backs,” but this is a good reminder that, when it comes to selling your business, your EBITDA can be subjective.
To find out if you could fetch an offer for 7.1 times EBITDA, get your Value Builder Score.
Dennis Hart founded Apex Media Sales in 1993. Generating approximately three quarters of a billion dollars in revenue shortly before the company was acquired by a fast growing media organization in 2007, Apex specialized in long-form direct response television advertising, servicing religious and infomercial advertisers. The company’s growth was fueled by leveraging substantial advertising opportunities, creating a strong sales initiative and crafting trade agreements as a unique way to capture broadcast television and national cable network airtime. A key component of the company’s growth was the development of a mousetrap in the form of proprietary software.
Raising Money Vs. Going It Alone
Katherine Hague co-founder of ShopLocket was a prodigious fundraiser in the two years from idea to exit. Hague describes some of the landmines to avoid when raising outside capital and why she still has one regret about the sale to PCH.
Built to Sell Intel - June 2021
This past month, we’ve interviewed four riveting guests on Built to Sell Radio.
John shares the transferable lessons on Built to Sell Intel, a monthly live webinar hosted for our listeners.
The Good, the Bad (and the Ugly) Of Selling to Private Equity
Marc Elkman built Fresh Meal Plan, a meal delivery service for healthy eaters, from an idea to $20 million in annual revenue in just three years.
Still in his twenties, Elkman earned a spot on the Inc 500 list of fastest-growing companies in America. Then he caught the attention of New Heights Capital, a private equity group focused on the fitness industry. New Heights acquired the controlling interest in Fresh Meal Plan in 2016 and Elkman continues to hold a minority stake.
The Inside Story of Stripe’s Acquisition of Indie Hackers with Co-Founder Channing Allen
In 2016 Channing Allen and his brother Courtland founded Indie Hackers, a blog and forum that encourages founders to transparently share their ideas and stories.
After only eight months, the brothers had grown the business to $8,000 in revenue when they received an unexpected email from Patrick Collison (co-founder and CEO of Stripe), who was looking to acquire the company.
Although tempted to keep building, Stripe’s offer was too good to refuse. The brothers agreed to be acquired by Stripe in March 2017.
Built to Sell Intel - July 2021
On this month’s episode of Built to Sell Intel, John will be sharing key insights from the latest group of entrepreneurs interviewed on Built to Sell Radio.
John recaps his favorite anecdotes in this monthly live broadcast, highlighting helpful strategies and transferable lessons.
Finding the Middle Ground With an Acquirer
Shawn Finder built email marketing platform Autoklose to $1 million in revenue when a chance encounter at a conference led to an acquisition conversation with VanillaSoft. Finder thought his company was worth much more initially than VanillaSoft did – their valuations were quite far apart and both sides had to negotiate to ultimately meet in the middle.
By now, you’re accustomed to hearing John Warrillow ask the tough questions.
Every month, we turn the tables and grill John on his favorite anecdotes and transferrable lessons from the latest batch of guests on Built to Sell Radio. In this episode, Dr. Jeremy Weisz gets John to reflect on what stood out, any missed opportunities, and how each story imparts the Built to Sell Methodology.
How to Sell Your Business to a Competitor
Alex Rink built 360pi, a software application that provided online retailers with competitive pricing information.
360pi grew into a multi-million-dollar company with 40 employees when Rink began hearing his business might be worth as much as 3-6 times revenue.
Selling Your Business vs. Getting Acquired
In 2012, Ryan Coon started Rentalutions, a platform to help landlords manage and communicate with their tenants more effectively.
The business showed steady growth, but Coon wasn’t satisfied.
Five years in, Coon rebranded the company to Avail and focused his marketing to target DIY landlords with under ten rental units to manage. The changes proved successful as Coon grew the business to around $7 million in revenue before selling to Realtor.com in 2020 for approximately five times revenue.
The format for Built to Sell Radio typically features our host, John Warrillow, interviewing an owner who has recently sold their business. This week, we’re going to try something different. Today’s episode features John’s analysis of four of the exits we’ve featured on the show. John will break down his key takeaways and transferable lessons.
WP Curve Get Acquired By Go Daddy
In 2013, Alex McClafferty co-founded WP Curve, a company that provided IT support for people with a WordPress site.
How Re-Modelling A Swimming Pool Business Led To A 7-Figure Exit
When Tommy Berretz had his successful swimming pool company valued, he had just one (big) problem: he didn’t like what he found out.
