In this episode of the M&A Launchpad Podcast, hosts Feras Moussa and Casey Minshew welcome special guest Alexis Grant, an entrepreneur with two successful exits and founder of They Got Acquired, a company that helps sellers learn more about their businesses and position them for an exit. Alexis discusses how data adds value in positioning a business and crafting an offer.
With a background in journalism and limited experience in business, Alexis transitioned from freelancing to running her own social media agency. She delves into her experience in the online business industry and explains how she grew and exited two businesses in the content site space. She navigates on how this industry looks like and how she thinks AI might affect this space.
Alexis outlines her current company’s mission to bridge the gap between inexperienced sellers and the M&A world, highlighting common mistakes and lessons often encountered during the process of selling an online business. She emphasize on the importance of data and insights for buyers and sellers at the moment of considering a deal.
In this podcast episode, we discuss:
- The transition from journalism to creating and selling a business
- Some of the biggest mistakes founders do when selling a business
- How is data being used to bridge the gap between sellers who don’t know where to start and the M&A world
- An overview on how the online businesses space is looking like right now.
You can connect with Alexis Grand by LinkedIn and website: Alexis Grant | Founder at They Got Acquired https://theygotacquired.com/newsletter/ and https://data.theygotacquired.com/
Additional Resources:
- Access our archive of video interviews on YouTube
- Checkout our upcoming Conference – https://malaunchpad.com/
- Get in touch with show hosts Casey Minshew and Feras Moussa at – info@equitylaunchpad.com
- Looking to invest in M&A opportunities or partner with an advisor to acquire, scale or sell your business? Visit Equity Launchpad
Transcript
00:01 all right on today’s episode we
00:02 interviewed Lexi Grant where we talked
00:04 about how do you transition from
00:05 journalism to essentially creating your
00:07 own company right having two exits and
00:09 then moving on and helping sellers kind
00:11 of learn more about their business and
00:13 industries and really what are a lot of
00:15 tips to give Founders in terms of
00:16 mistakes made and how do they start to
00:18 position their business for an exit so
00:20 Casey what were some of your takeaways
00:21 you know when you when you get into
00:23 selling your company right it’s it’s
00:25 usually for most people it’s going to be
00:26 the biggest sale that they’ve ever made
00:27 in their with their heart their soul and
00:30 their business
01:31 and being able to get data to be able to
01:33 help you make a better decision it
01:35 really is priceless in a lot of ways and
01:37 so not only is Lexi a entrepreneur who
01:40 has had two part exits she had rolled in
01:44 equity into a company and then that
01:46 company had an exit at a later date
01:48 she’s now back building a business
01:49 that’s focused around giving data to
01:52 people that are looking to sell these
01:53 online businesses so to me it’s just an
01:55 incredible value ad for somebody that’s
01:57 really sitting out there going hey I
01:59 have an online business I want to sell
01:02 where do I get data for this yeah
01:03 absolutely and you know we all learn
01:05 from seeing from others right and so
01:07 seeing what others have exited seeing
01:08 how they positioned all those things
01:10 kind of go into making a successful
01:11 transaction and I think you know this
01:13 episode we also really talked about some
01:15 of the mistakes sellers make right like
01:17 if I want to sell it’s not hey today I’m
01:18 gonna decide I’m gonna sell and tomorrow
01:19 I’m gonna sell right it’s really I need
01:21 to be way ahead of it right I’m gonna
01:24 sell okay in a year from now I’ll be
01:25 ready so what are the steps I need to
01:27 make between now and then to kind of get
01:28 myself geared up and positioned and like
02:30 kind of Lexi alludes to right she’s
02:32 talked to a lot of sellers she’s seen
02:33 kind of consistencies in terms of what
02:35 they do and what they don’t do and how
02:36 do they kind of avoid those landfall
02:38 those those Minds to kind of have a
02:40 successful exit yeah have that package
02:42 ready to go cool all right well we’ll go
02:44 hop into
02:48 it hey Lexi welcome to the show hey
02:51 thanks for having me excited to have you
02:52 on board so for our listeners you want
02:54 to give a little bit of background about
02:56 yourself and kind of what you’re
02:56 currently doing sure my background is in
02:59 building media businesses and I sold two
02:02 of them over the last
02:04 decade and thanks and during that
02:07 process I felt like there wasn’t a lot
02:09 of resources to help Founders like me
02:11 and like me I mean you know you’re
02:13 making a six7 or even a low eight figure
02:15 sale it felt like all of the success
02:16 stories I was seeing and all the
02:18 resources out there felt like they were
02:20 aimed at much much bigger sales so two
02:23 and a half years ago I launched they got
02:24 Acquired and that’s the business I’m
02:26 running now it’s a media company first
02:29 with a data arm and our mission is
03:31 really to help Founders sell their
03:32 business so I consider us a bridge
03:35 between Founders
03:37 who um want to sell but really don’t
03:39 know where to start and don’t understand
03:41 the process and need to learn about it
03:42 and educate themselves and the m&a world
03:45 U which can be intimidating sometimes
03:47 for Founders the first time they go
03:48 through it speaking of intimidating then
03:51 maybe you know maybe I think you got
03:52 your start as a journalist right
03:54 actually here in our backyard in Houston
03:55 Chronicle yeah yeah you know what gave
03:58 you that confidence to kind of make that
03:59 leap and actually start Media company
03:00 right because most journalists don’t
03:02 have that kind of spirit and so what was
03:04 that segue to get get you started
03:07 there it’s funny because I never thought
03:09 that I would run a business and in fact
03:12 I to this day I wish I took more
03:13 business classes in courses and or in
03:15 business classes in college I never did
03:17 that um but I I took a sabatical um
03:23 after i’ been in the workforce for a few
03:24 years and I I traveled around Africa and
03:26 I came home and I was writing a book
03:28 about it and I needed to make money
04:30 while I was looking for a job and so I
04:32 just started freelancing and my first
04:34 the first business that I ran was a
04:36 social media agency and this is in like
04:38 2010 so it was when it was just kind of
04:41 getting more popular and people were
04:42 looking for help with that so I think
04:44 like many entrepreneurs I stumbled into
04:47 it out of necessity and looking for
04:49 something fun and interesting and
04:50 different and just grew from there got
04:53 it what did that first company do it was
04:55 a social media agency so and actually it
04:58 it very quickly pivoted to more content
04:01 marketing generally so again this is in
04:03 the 2010s but we ran blogs for
04:06 businesses so there’s a lot of
04:09 businesses at that time that wanted to
04:10 have a Blog but they didn’t know how to
04:11 do it or how to get people to come to
04:13 that blog so we would run them for
04:16 businesses that’s great and and how long
04:18 did you run that first
04:20 company I ran it for about five years
04:23 and that was that was the first sale
04:25 that I made so that company was it was
04:28 an aqua hire but we were purchased by by
04:30 one of our clients so we we ran the
05:33 content for a media company called the
05:35 penny border it’s a personal finance
05:37 media brand and um after we had worked
05:40 together for about a year and a half the
05:42 founder asked if he could bring myself
05:44 and my team in house there as he was
05:47 kind of you know blowing up the business
05:49 and growing it much bigger how exciting
05:52 yeah no I remember blogging was the
05:55 thing in 2010 cuz my my background is
05:57 actually I would say development in the
05:59 web world so I was super deep into it
05:01 and you know and it’s interesting to see
05:03 what all of the AI kind of content
05:05 writing stuff that’s there now and how
05:07 you can kind of quasa automate that and
05:09 get that cont of generation that some
05:10 people were looking for but maybe you
05:13 know dive into that a little bit so how
05:14 big did you grow it so five years right
05:16 you grew it then kind of a year and a
05:18 half into a relationship with a customer
05:19 they ended up acquiring you how many
05:21 people was it what were revenues and
05:22 kind of what was that acquisition like
05:25 yeah um well it was I still didn’t have
05:27 any employees they were all contractors
05:29 working for me and it was at the I was
06:30 at the point where I was I had a few of
06:32 the contractors working full-time so I
06:33 was having conversations around like do
06:35 I want to have employees like what do I
06:36 want this business to look like
06:40 um and I’m trying to think this feels
06:43 like so long ago now and I don’t talk
06:44 about it the specifics about it that
06:46 often but um yeah when when I went in
06:49 house it was myself and I think five
06:51 other folks from the team came they had
06:54 been contractors for me but they joined
06:55 as full-time employees um and we scaled
06:59 the business really quickly uh it was a
06:01 great education for me because that was
06:03 my first time really helping heavily
06:05 with the operations of scaling a startup
06:07 and we grew it to something much bigger
06:09 than I would have done on my own it that
06:11 that business the penny holder hoarder
06:13 had sold for $100 million a couple years
06:15 ago and it was a bootstrap business um
06:18 which is one of the reasons why I agreed
06:19 to go in because um I felt like we’d
06:22 have a lot of autonomy growing the
06:24 business I was a second employee um so
06:27 it it was a great experience it was it
06:28 was again something wouldn’t have done
06:30 on my own and I got to learn a lot
07:31 through
07:32 it that is fantastic so so so the way
07:34 that it worked so you your media company
07:36 was acquired by a group and then that
07:39 company then had a second exit is that
07:42 is that what happened that company
07:44 exited or yeah yes not a second exit
07:46 they had a exit yep they had an exit
07:48 hopefully you rolled some equity in that
07:49 one right for our listeners talk about
07:50 rolling equity and there you go so
07:52 that’s the value of rolling Equity I
07:53 mean you get a much higher a little I
07:54 had a tiny tiny little bit hey little
07:57 bit of $100 million is still plenty so
07:59 yes and then you get two exits and
07:01 that’s a beautiful story for somebody
07:03 that did never consider themselves an
07:04 entrepreneur I mean that’s literally the
07:06 conversation Casey and I are going to be
07:07 having later tonight at dinner so we’re
07:08 flying out another part of Texas with
07:10 business own whatever deal we’re looking
07:11 at and you know we already met with them
07:13 and trying to really work out the
07:15 mechanics of what those rolling look
07:16 like and kind of what the expectations
07:17 look like there so very at the time I
07:20 really now that I’ve been running they
07:22 got acquired for two and a half years
07:23 I’ve learned so much about this world
07:24 but going through that the first time I
07:27 you know I didn’t know any of this stuff
07:29 I didn’t even really know was called an
07:30 aqua hire till after we were through it
08:31 you know so there’s so much to learn
08:34 that’s actually a new word for me I’ve
08:35 never heard of that so it’s i’t heard of
08:37 an aqua see in the software world we use
08:39 it all the time so that I did I
08:40 definitely heard that many times um so
08:43 then that was your first business right
08:46 then kind of Carri us forward what did
08:47 that second one look like yes so when I
08:49 left the penny order in
08:52 2019 and was trying to figure out what I
08:54 wanted to do next and just stepping back
08:58 like while I had been running the agent
08:00 we had launched our own brand so I
08:02 mentioned we were running blogs for
08:04 other for companies and during that time
08:08 I said hey the problem with this is like
08:11 we’re building up these Brands these
08:13 blogs and these followings for other
08:15 businesses and then if they ever leave
08:16 us we don’t get any upside for that so
08:18 we ended up applying the people and the
08:21 systems that we had built for our
08:23 clients to our own brand and we started
08:25 a Content site it was a website for
08:27 writers it was called the right life and
08:30 and it grew to be I’d say the biggest
09:33 name in that Niche um over the next
09:36 bunch of years it was really um when I
09:39 worked at the penny hoarder I it was a
09:41 side project and I had two kids during
09:43 that time it was a very intense period
09:45 of my life so I was not um working on
09:48 that site during that time um actively
09:51 but we had an editor who was just like
09:52 running it and keeping it growing um and
09:55 I wasn’t even making any money on it it
09:57 was just like paying for itself to keep
09:58 growing but because because of that when
09:60 I left the penny hoarder I had this
09:01 asset that was sitting there and I I
09:03 asked myself like do I want to do
09:05 something bigger with this what what
09:07 what do I want my future to look like
09:09 and so I took probably nine months to
09:11 play around with it and I did I made a
09:12 lot of SEO improvements because I found
09:14 that to be fun and kind of experimented
09:16 with it and then said hey I want to move
09:17 on to something else this feels like
09:19 what I did like 10 years ago so I that
09:21 that was a second sale I sold that site
09:23 it was a an asset sale so much different
09:26 than my first one so I I sold it to
09:28 someone else and just passed it over I
09:30 didn’t go along with it we had a small
10:31 transition period but because I am
10:34 pretty process driven we everything was
10:36 systemized and it was pretty easy to
10:38 pass it over um so that that was a mid
10:41 six figure sale nice exciting so it’s
10:43 funny you had the same Epiphany I had
10:44 whenever you know I I really got started
10:47 in the web because I was I learned how
10:48 to code and I was making websites for
10:51 people right and then I remember I made
10:53 this side project it was called Wall
10:54 Street pros at the time or I called it
10:56 something else but the guy rebranded to
10:57 that and I sold it you know something I
10:59 had made in like a 4 day period right
10:01 where it was all fake money but real
10:03 stock data right so you can kind of go
10:05 in and go learn I was a high schooler at
10:06 the time and I sold it to the guy that
10:08 owned board.com so if you were Bor back
10:10 in the early 2000s you go to board.com
10:12 and it was a link of a lot of websites
10:14 and guess what 90% of the websites he
10:16 linked to were his so he’s keeping all
10:18 that traffic in the family and I just
10:19 remember selling him the website
10:21 thinking like man I just made a killing
10:22 off four days right and then he hired me
10:25 to just make continue improvements to it
10:27 and he was making in one month what he
10:29 bought it for for me but then I’m like
11:31 man I should start creating my own stuff
11:33 that I get to keep right and so that
11:35 same thought process of how do I kind of
11:37 move up the stack and kind of retain
11:39 more of that and so um it’s always
11:41 interesting to see just you know what’s
11:43 around that corner right and you don’t
11:45 know until you get to see it yeah yeah
11:48 definitely so Lexi how do you see now
11:50 with knowing that you’ve been in the
11:52 blogging the riding and all stuff so how
11:53 do how do you think AI is affecting
11:56 those spaces are you starting to see it
11:58 as maybe it just enhances it or is it
11:00 you think it’s just going to really
11:02 ultimately take over it’s such a
11:04 different space than it was back then I
11:05 mean totally different and even down to
11:08 like the ways that you get traffic are
11:10 much different um I used to love the SEO
11:14 space as a really reliable traffic
11:16 generator and it’s not always the case
11:19 anymore um so I think it’s just really
11:21 forced everybody to rethink how they run
11:24 content businesses and it’s been a
11:25 really hard um year or two for Content
11:27 businesses because of all those changes
11:29 but right now what I’m excited about is
12:31 the opportunities for AI enhanced and
12:35 like enabled businesses I still think
12:37 that there’s a place for people who are
12:40 writing researching fact checking
12:42 checking and editing and my personal
12:44 belief is that the content businesses
12:47 that have those pieces will come out on
12:49 top because
12:51 eventually um either PE people notice
12:54 that you know a resource isn’t good or
12:56 Google might find a way to crack down on
12:58 some of those um you know low quality
12:01 type sites um so I think it pays off to
12:04 do it at least um you you can have and
12:07 we do we use AI for um little pieces of
12:10 the process but not to write the content
12:12 and and it wouldn’t work for our our
12:14 cont so we we tell stories of
12:15 entrepreneurs who have sold their
12:16 businesses and a lot of the stuff we
12:18 writing it’s never been written before
12:20 like for AI it has to exist already so
12:22 you can repurpose it and so something
12:24 like us there’s a mo because it can’t
12:26 you can’t scrape it if it doesn’t exist
12:28 yet right no so you’re using it to
13:30 enhance everything that you’re doing and
13:32 I think that that’s better you got to
13:33 have a Slicker term okay AI
13:36 augmentation AI augmentation I just I
13:39 just coined that one I’ve not read or
13:40 heard that
13:43 one so going into uh the current
13:45 business right now so let’s let’s talk
13:47 about what’s what you’re seeing uh so
13:50 just so the listeners know so Lexi’s
13:52 group focuses on online businesses and
13:54 providing the content the m and the data
13:57 needed for a seller to be able to make
13:59 better decisions right um so what are
13:03 you seeing in the market right now for
13:05 the online businesses what do you what
13:07 are what what are you seeing with your
13:09 with the people you’re selling and give
13:11 us some feedback on on that what you’re
13:13 talking to your clients about and to add
13:14 to that really Qui how did you end up
13:17 getting from kind of exiting that sixf
13:19 figure exit to deciding to go into that
13:21 space because again very different space
13:23 yeah I mean we’re a media company at
13:25 heart and I I like the idea of creating
13:29 turning something that feels
14:30 intimidating and unaccessible and making
14:32 that accessible to people who can
14:34 benefit from it that’s what I see our
14:36 main job as so to me that’s like the
14:39 same thing I was doing for the media
14:40 company right it’s like how can you make
14:42 something accessible and fun and it’s
14:44 content that helps people so in that way
14:46 it’s um very similar to what I was doing
14:48 before but yes the space is different
14:50 and I personally had to learn a lot
14:52 about m& because I still don’t consider
14:53 myself an expert in m&a and I’m not
14:56 we’re not a brokerage right I don’t do
14:57 that um but I have learned a lot about
14:00 it since we first started and much of
14:02 that is because I talk to a lot of
14:03 Founders who want to sell so I I am not
14:06 selling businesses but we talk to
14:07 Founders who want to sell and then we
14:09 write about the stories after they’ve
14:11 sold and we collect data for our m&a
14:13 platform and that’s about sales that
14:15 have already happened yeah so I a lot of
14:18 people say to me what’s the market doing
14:19 right now and like sometimes I talk to
14:21 people about that but I’m not seeing it
14:23 because I am not actually selling
14:25 businesses um but I can tell you kind of
14:27 some of the things that I see from
14:29 talking to a lot of Founders that I want
15:31 to sell yes from Founders who want to
15:33 sell um one interesting piece is just
15:36 that there’s certainly a gap right now
15:38 between what buyers are willing to pay
15:40 and what sellers are willing to take and
15:42 that has stalled a lot of the people
15:44 that I talk to from selling because a
15:46 lot of Founders you know their brain is
15:48 still back in the Glory Days of 2020
15:51 2021 when online businesses were selling
15:53 like hot cakes and getting great
15:55 multiples and buyers you know know that
15:58 we’re kind of past that now and we’re in
15:00 a different phase and my The Leverage
15:03 buyout has gotten a lot more expensive
15:05 right I mean financing double what you
15:07 that’s a big piece of it leverage buy
15:09 don’t make sense same thing we’re see in
15:10 commercial real estate and so you know
15:12 trying to get seller expectations reset
15:15 right because the deal happens
15:16 ultimately once both sides are aligned
15:18 there exactly exactly so I think that’s
15:20 been a challenge and then also a lot of
15:22 seller a lot of sellers or the founders
15:25 I talked to a lot of them have had a
15:26 rough couple of years you know
15:28 especially content e-commerce um so the
16:30 four comp the four types of companies
16:32 that we typically um support are content
16:35 or media e-commerce um SAS and software
16:39 and agencies and I’d say I mean most of
16:43 them except for software have had kind
16:45 of a rough couple of years it doesn’t
16:47 apply to everybody certainly and there
16:49 are lots of people who are doing great
16:50 but um I talked to a lot of people who
16:53 have yeah they’ve had it rough couple
16:54 years so they’re trying to get their
16:55 numbers up now so that they can sell at
16:57 a place that feels good to them and you
16:60 think that that is that just because of
16:01 we had the the the covid push and then
16:03 everything kind of fell off is that
16:05 really why a lot of these guys you’re
16:07 talking to are struggling I think it’s
16:09 just been hard the last couple years
16:10 because people don’t want to spend um
16:12 like for example if you have an agency
16:15 and if you’re a business that outsources
16:16 things to an agency when you don’t when
16:18 you want to keep your cash close you’re
16:20 not going to spend money on those
16:21 outsourc Services as much or maybe you
16:23 don’t just put as much money into
16:25 marketing um and then I mean the
16:27 content’s kind of a different totally
16:29 different game that that space has been
17:32 crushed by some of the Google changes um
17:35 and AI as well and so buyers tend to see
17:38 it as risky um and again it depends so
17:40 much on the specific business like I
17:42 talked to a seller yesterday was a
17:44 million-dollar recurring Revenue content
17:46 business that is has a great Moe and I
17:49 and I’m sure he’ll sell it for a lot of
17:51 money um but just generally speaking um
17:55 I think a lot of people have been on the
17:57 struggle Bal last year so yeah do I mean
17:60 so what I guess for the listeners right
17:02 what is the biggest maybe let’s start
17:03 with biggest mistakes that you’re seeing
17:05 sellers do right is it not having good
17:08 books is it not having the right
17:09 expectations not having process I mean
17:11 what are the biggest mistakes for those
17:13 listeners that are potential sellers in
17:15 the future that you see from the sellers
17:16 that you’re talking to yeah I mean the
17:18 biggest thing that we preach and it’s
17:20 like our top number one thing is think
17:22 about this before you’re ready to sell
17:24 because if you decide you want to sell
17:27 and then you need to sell soon either
17:28 because you’re so stressed you don’t
18:30 want to keep working you don’t have the
18:32 energy to keep running the business you
18:34 have a there’s a health problem in your
18:36 family or you know you see the business
18:39 starting to go down you decide oh God I
18:41 get I got to get out those are all like
18:44 you can sell at all those points but if
18:46 you think about it ahead of time and
18:48 sell while you’re still the business is
18:49 still increasing or still improving um
18:53 that’s you’re going to have a much
18:53 better exit so the whole idea is just
18:55 like how can I get people to think about
18:57 this before it hits them in the face and
18:59 and they have to learn about it right so
18:01 like some people come to us cuz they
18:02 have to learn about it because they need
18:03 to sell now or they they’re desperate to
18:05 sell now you really want to be more
18:07 proactive about it if you can and think
18:09 about it ahead of time because all the
18:10 things that you mentioned um there are
18:12 so many once you understand how to
18:14 increase the value of your business you
18:16 realize that these most of them are not
18:18 quick fixes you’ve got to do them in
18:20 advance and sometimes it takes you know
18:21 six months or a year or even more to see
18:23 the ROI on those changes so if you’re
18:25 thinking about it ahead of time and even
18:27 working ideally with like an adviser or
18:29 someone who can help you understand how
19:30 a buyer is going to look at the business
19:32 then you’ll be able to sell it for a lot
19:33 more sometimes it’s not even core to the
19:35 business right just like getting good
19:36 books I mean you get more value on a
19:39 sale if you have good books versus the
19:41 guy that does it on paper and you have a
19:43 seller that’s already disc they’re buyer
19:45 that’s discounting at 40% because
19:46 they’re going to question everything and
19:48 have five times more work to to validate
19:50 so yeah one of the things I I learned
19:52 running startups is you know we always
19:54 had a data room we always had you know
19:57 when we had a a document or a file we
19:59 all saved those important things into
19:01 our data room so literally from day one
19:03 we would build a Dropbox folder or
19:05 whatever you know shared file and then
19:07 we would build out all the different
19:09 like key things that someone’s going to
19:10 look through through Dil due diligence
19:12 and then throughout the year we would
19:14 just fill those those folders up you
19:16 know so we were ready if somebody did
19:18 come and talk to us because we were
19:19 always either a raising more money
19:20 getting ready for another round doing
19:22 those things and it really became a
19:24 really good practice of of how you know
19:27 when we’ve come into the the the m&a
19:28 side you know looking at some of these
20:30 older companies we go through a process
20:32 with you know these aren’t perfectly
20:34 packaged especially if you’re going off
20:36 Market you know um our acquisition that
20:38 we did was an off Market we did not work
20:40 through a broker and so it wasn’t like
20:42 perfectly packaged but you know we’ve
20:44 now taken the company over a year and
20:46 we’ve started to build out those folders
20:47 and you know I literally was having a
20:49 call yesterday with a uh an auditing
20:52 firm because we want to start the audit
20:54 process in 2025 for the 2024 well I
20:59 didn’t know I didn’t realize that you
20:01 know they’re going to have to go back
20:02 and audit the opening balance sheet and
20:05 so that right there takes 60 days so
20:08 instead of waiting to the to to the end
20:10 of the year you know it’s kind of like
20:12 breaking it up and so you kind of learn
20:13 these things like wow so yes why would
20:15 you why would you audit well you’d audit
20:17 because if somebody Taps you on the back
20:19 and says hey you know we’d like to buy
20:21 you you want to be ready right and I
20:23 mean I think those are those things that
20:25 I think that all business owners not
20:26 necessarily an audit but these kind of
20:28 mindsets of having that that that
21:30 package ready to go yeah absolutely and
21:32 I mean we see a lot of Founders who have
21:34 sold they understand these Concepts and
21:36 they apply it to their second business
21:38 even doing little things like you know
21:40 if you use a drive folder in Google
21:42 Google Drive you’re making sure that
21:43 it’s you’ve set it up in a way that’s
21:45 easily you can easily pass it on to the
21:46 next person because I’ve made that
21:48 mistake before where I couldn’t pass it
21:49 on you know little things like that if
21:51 you gone through it once you think about
21:52 those things um so our goal is to just
21:55 help the Hors who you know haven’t had
21:56 that experience so they can kind of have
21:58 some of those sites their first time
21:00 around yeah I know I mean it’s it’s
21:02 funny because you’re so deep in starting
21:05 and you know operational stuff and you
21:07 kind of forget all the other stuff right
21:08 and that stuff is equally important I
21:10 mean we were finalist for H of the year
21:11 and it was just almost comical because
21:13 we had to whip out a whiteboard just to
21:14 explain our company and the organization
21:16 the entities just because it was all one
21:18 big mess at the beginning and now we’re
21:20 you know normalizing it and separating
21:22 it all out and it creates complexity
21:24 right and we’re we obviously weren’t
21:25 selling but you know same concept
21:27 potential buyer you know you don’t want
21:28 to have to do that with a potential
21:29 buyer where let me whiteboard what all
22:31 these things are and why you should
22:33 trust all this so but you’re not going
22:34 to get the multiple right you’re not
22:35 going to get what you’re looking for so
22:37 so Lexi what do where do you see the
22:39 trades right now uh for uh you know
22:42 these online businesses um I I take it
22:45 that you’re looking at a recur people
22:46 are buying on a recurring revenue and
22:48 there’s a multiple typically tied to
22:50 that is what you’re you’re talking to
22:51 them about yeah I mean it really depends
22:54 on what type of business cuz Ecom
22:56 content agencies and SAS all have
22:59 drastically different multiples and some
22:01 of those are recurring and some of them
22:02 aren’t um like I was me just mentioned
22:04 you know an owner of a Content business
22:07 many content businesses are not
22:09 recurring Revenue but the one I was
22:11 talking to yesterday was so like if you
22:13 can achieve that then that is going to
22:15 you know help you push up your multiple
22:16 of course so it really depends on the
22:19 type of business and sometimes um even
22:22 the vertical and certainly the size as
22:24 well
22:25 so of course like the bigger the
22:27 business the better multiple you’re
22:29 going to get because it opens up a
23:30 different type of buyer but in your
23:32 space so you know we focus on the lower
23:33 Middle Market but you know yeah
23:35 preferably kind of more blue color
23:37 oriented all that is driven on multiples
23:39 of iido right three four x you know kind
23:42 of in that range in your space is it
23:44 multiples of Revenue is it multiples of
23:46 you know what are they actually looking
23:48 for and then you know for the listeners
23:49 just what are the ranges you’re
23:50 typically seeing and then I’ll add one
23:52 more question to that I want you ask a
23:53 lot of questions um favorite you know fa
23:57 I guess favorite businesses come your
23:58 way that you’re like you know this is a
23:59 pretty cool business and yeah I see
23:02 quite a few of those where I’m like do
23:03 not buy this do not buy this um yeah but
23:07 yeah to answer a question around uh
23:10 multiples um what was what what was the
23:12 first question you asked I’ve lost it
23:13 now is it multiple of Revenue multiple
23:15 earnings I mean what I mean profit is
23:17 still the most important part and
23:18 actually that’s a huge piece that I I I
23:21 educate Founders on like every single
23:23 day is like um like I talked to a
23:26 Founder last week who has a great
23:29 business you know they’re bringing in
23:30 like a million in Revenue but she’s not
24:33 turning a profit and it was hard for
24:35 understand like how that this wouldn’t
24:37 isn’t seen as incredibly valuable to
24:39 someone and if she gets the right
24:40 strategic buyer obviously then it could
24:43 sell for a good some of money because
24:45 they built up an audience and there’s
24:47 other um there’s money coming in the
24:48 door but just having people understand
24:51 that the The Profit either and a lot of
24:54 folks I talked to they’re calculating SD
24:56 so sellers discretionary earnings or it
24:58 might be e for a bu bigger business but
24:00 I often just call it profit because
24:02 people understand that it’s like how
24:03 much are you taking home and that needs
24:05 to be the more you can improve that then
24:07 the more you’re going to get paid for
24:08 your business so um in terms of the
24:10 multiples yeah I would say that’s
24:12 usually the first metric that a multiple
24:14 might be based on but there are some
24:16 businesses that are based on a multiple
24:18 of Revenue um and I mean I’ve heard for
24:21 even for SAS businesses I believe and by
24:23 the way I’m not a valuations expert I
24:25 usually send people to like a broker to
24:26 do that sure sure um but you for I’ve
24:29 heard people say for software for
25:31 example or for SAS that you might be
25:33 valued on um iida up to a million
25:37 dollars but then above a million dollars
25:39 in Revenue maybe the multiple switches
25:42 over to revenue so um interesting there
25:45 are different people who do it in
25:46 different
25:47 ways okay and favorite business you’ve
25:49 seen so far kind of come
25:51 across oh gosh we put a few of these
25:53 into First Look of which is our um we
25:56 have a newsletter for buyers that
25:57 features uh Founders that I talk to who
25:59 want to sell who have not listed the
25:01 business yet so a few of those a few of
25:03 these businesses have gone into first
25:04 look and um these are ones where I’m
25:07 like all right tell my husband like do
25:09 not let me buy this business um some of
25:11 them I mean I think anything with
25:12 recurring revenue revenue is always
25:14 really interesting there is a woman I
25:16 don’t I want I don’t want to be too
25:18 specific about it actually I’m trying to
25:19 think I can give an example that’s not
25:20 specific well here’s another one is I
25:23 also talk to a lot of women who are
25:24 selling and that’s like an underserved
25:27 population um there aren’t a lot of
25:29 women in the m& space so sometimes I
26:31 think it’s refreshing for them to have a
26:33 woman to talk to about this stuff um so
26:35 like a lot of the examples I’m giving
26:36 are women because I we serve a lot of
26:38 female business owners but there was one
26:41 when I talked to who had an e-commerce
26:43 company that where she had um the the
26:47 product it was like a kitchen product
26:49 and it’s very unique and like really
26:50 welld designed because she’s into design
26:52 and she focused a lot on the Aesthetics
26:54 of the product but she wasn’t great at
26:58 like marketing
26:59 or selling and like I looked at that and
26:01 I was like oh I mean I’m good at
26:03 marketing that’s kind of what I consider
26:04 to be one of my strengths so I look at
26:06 that and I’m like oh man if you just
26:07 partner with a marketing person you sell
26:09 to a marketing person you’ve done all
26:10 the hard work of creating a great
26:11 product and making sure that can keep
26:13 getting made um then that that would be
26:15 you know a great opportunity for the
26:16 right buyer got it and I don’t even know
26:19 if I’d call that even Ecom so you gota
26:20 have that real world component of it too
26:23 yeah yeah well she’s selling a house
26:25 good online so that’s yeah that’s
26:27 exciting so talk to it real quick just
27:31 in regards to your company right now so
27:33 um if somebody was interested in your
27:34 services what are the what are the
27:36 things that you would go through like
27:37 talk to us about the business how like
27:39 someone go online and and and how do you
27:42 help in in in a lot of ways our main
27:45 product is our m&a data platform we call
27:46 it they got acquired data and it does
27:49 two primary things it can help you pull
27:51 comps or see other businesses that are
27:54 like the one that you either want to buy
27:56 or sell and obviously comps are hard to
27:59 find for private transactions generally
27:02 but like for example um we just had a
27:05 user come into the platform who was
27:08 going to wanted to buy a community
27:09 business like an online community and
27:11 that’s a very specific Niche and he was
27:13 having a hard time finding other similar
27:15 businesses that he could use to model
27:18 like an offer so he came into our
27:21 platform he pulled a list of online
27:23 community companies that had sold in the
27:25 last 5 years and he used that to craft
27:28 his offer and justify his offer to the
27:29 company that he wanted to buy oh wow so
28:32 comps is one thing and the other piece
28:35 is um we don’t anonymize our data so
28:38 basically our database it features deals
28:40 that have happened in the last five
28:41 years um our sweet spot is between
28:44 $1,050 million in terms of the size of
28:47 the deal so this is a it’s smaller than
28:51 what a lot of other platforms track and
28:53 also it’s only online businesses so we
28:54 don’t do like Main Street um brick and
28:57 mortar businesses but um because we
28:00 collect all of these deals that have
28:02 happened and we don’t anonymize the data
28:04 we can slice and dice it in lots of
28:05 different ways so we can see who the
28:07 buyers are so we have like a
28:09 cross-section of the data that shows um
28:12 who are the buyers that have been buying
28:13 lots of SAS companies or lots of
28:15 e-commerce or whatever it is in the last
28:18 few years and if a Founder comes to us
28:21 or and wants to or sometimes we work
28:23 with m&a advisers as well who need to
28:25 find buyers for their clients and they
28:26 want to add more buyers to the pool
28:29 they can do a search that says hey what
29:31 buyers have bought this type of business
29:34 in the last few years so that we can
29:36 reach out and then contact them we have
29:38 contact information in the platform as
29:40 well instead of the big focus on
29:42 Founders I mean there’s definitely value
29:43 there for buyers right you understand
29:45 what’s happening in my niches that I’m
29:47 focusing on or you know who I want to go
29:49 who’s been acquired that I want to go
29:51 acquire their parent company I mean
29:52 there’s a lot of ways to kind of play
29:53 with that so yeah we’ve had a lot of
29:55 interest more than I expected really
29:56 from buyers because I haven’t really
29:57 focused on buyers as um a user segment
29:60 for us we have a free newsletter online
29:02 it’s they got.com newsletter and most of
29:05 the people who read that are founders
29:08 but we also have some buyers and we have
29:09 some like investors on there as well but
29:12 because of that I was focusing more on
29:13 the founder side but it’s been
29:14 interesting to see a lot of I actually
29:16 believe if you if you mine it I actually
29:18 I’m willing to bet the buyer side will
29:20 be the more valuable profitable side of
29:21 that it might be you know come back to
29:23 me in two years let me know how that
29:25 pans up but I just you know like
29:26 founders
29:28 are founders right I mean you kind of
29:30 there’s a mix of them buyers are very
30:32 strategic typically right they have a
30:33 plan they’re willing to spend money to
30:35 accomplish that plan and so they’re much
30:37 more you know willing to spend the money
30:40 right and they’re a lot more serious
30:41 whereas buyers I’m sure you kind of have
30:43 the mix you have the guys that really
30:44 want to sell and the guys that oh you
30:46 know it’s kind of a it’s a it’s a pipe
30:48 dream right like yeah I’ll sell if
30:49 somebody overpays me significantly but
30:50 they’re not really there to complete the
30:52 transactions right buyers also typically
30:54 understand the value of the data and the
30:56 insights because they know how hard it
30:58 is to get so and they they’ve been in
30:60 this for a while and so yeah it’s us
30:01 it’s typically the value prop is more
30:04 obvious to them so what are some of the
30:06 biggest lessons you’ve learned in this
30:07 business so far about selling a business
30:10 or running no just about you running
30:11 running your business um I mean it was a
30:14 real transition for me I before doing
30:16 this I was running a team of like you
30:18 know 60 within the previous company I
30:21 was working at and now I’m starting over
30:23 again with a small boot bootstrapped
30:26 team of contractors and think I
30:29 underestimated that that would be
31:31 challenging to start over again like
31:32 it’s been a while since I did that
31:33 started from scratch
31:35 um but it’s been a lot of fun and I
31:37 think it’s made me like rethink what do
31:39 I want out of this business um you know
31:42 my my dream the what I what sounds
31:45 appealing to me is I don’t want to build
31:46 a massive company with tons of employees
31:48 I’m really interested in the um you know
31:50 High Revenue low headcount type of
31:53 businesses so that’s that’s what we’re
31:54 going after um and I I believe in like
31:58 you know having a business support your
31:59 life rather than the other way
31:02 around so I I build with that in mind as
31:05 well got it you said you have two kids
31:08 right I do yep oh yeah so you also have
31:10 some other focuses that are out there as
31:12 well enjoying that yeah said it earlier
31:15 they were limiting her whenever she was
31:16 at the penny hor yes probably very young
31:20 yeah it was I said it was intense few
31:22 years which is true I believe they’re
31:25 older
31:26 now yeah it’s always nice you you know
31:29 um so one of the things we want to do uh
32:31 for our listeners is jump into our
32:33 rocket round all right so what in their
32:35 rocket round we’re going to go through
32:36 and ask Lexi some questions uh three
32:38 questions um so we can get to know her
32:40 better and so Lexi if you’re good with
32:42 it um I’m gonna go ahead and fire the
32:44 first question at you so what do you
32:46 like to do in your free time I like to
32:49 be outside before this call I was I
32:51 volunteer with the trail uh group here
32:54 in town and I was we were in a hiking
32:55 town so I was out scoping some new
32:58 trails that we’re building um this
32:00 morning that’s I like to be outside oh
32:03 nice all right awesome uh next question
32:05 most memorable moment in your business
32:07 journey in this business I think I could
32:10 point to a couple times when we helped
32:12 founder cell and even I remember the
32:14 first founder that I had done a call
32:17 with and helped connect him to a broker
32:19 and when he sold his business and got in
32:20 touch with me and told me that he had
32:21 sold and it was partly because of you
32:23 know the chat that we had had and he
32:25 realized he didn’t even realize honestly
32:26 that it was possible before started
32:28 following us um those are the ons that
33:31 always feel really special to me so I
33:33 I’ll certainly remember people like that
33:35 and and as they as they close on their
33:37 own winds absolutely again most people
33:39 don’t really know what’s out there so
33:41 yeah and it’s gonna be one of their
33:41 biggest things that they’ve done in
33:42 their life right and so you get to
33:44 assist them in that process which is
33:47 huge yeah lots of karma reward there the
33:50 thing that they’re gonna be on a podcast
33:51 telling you know people about and
33:53 telling their grandkids about so all
33:55 right so last question what is your
33:57 favorite tool or resource
33:00 I’m in air table every day now so I I’ll
33:03 say air table I I it’s it’s a you know
33:06 version of Google Sheets but it’s it’s
33:08 where we house all of our data and um I
33:12 it’s I love now they have a feature
33:14 where you can um use AI to write you
33:17 know write some scripts that will help
33:18 you do more advanced manipulation of the
33:21 data and I found that to be super
33:23 helpful there’s so many things now that
33:25 you can do on your own that I could
33:26 never have done 10 years ago running an
33:28 online business it’s it’s really yeah
33:30 it’s really fun you’re the second person
34:31 that said air table air table got plenty
34:34 of yeah I mean it’s just power it’s
34:35 powerful right it’s a good way to stay
34:37 organized and it’s kind of it’s that
34:39 because you know my background is
34:40 software so I’m comfortable building
34:41 databases and you know customizing ex
34:44 all all that but there’s that lay of
34:46 people that are technical enough but
34:48 don’t know how to do that and so Roy
34:49 starts to bridge that Gap and gets more
34:51 more people able to consolidate and
34:52 organize and I mean it’s it’s pretty
34:54 slick so I’ve been yeah you know my
34:55 husband’s say um Google Sheets developer
34:59 expert he he teaches Google Sheets so he
34:01 does most of our home stuff’s all in
34:03 sheets and he he can do all these fancy
34:05 scripts and sheets to do anything we
34:07 need but for me I can’t do that stuff
34:09 unless I have ai to help me so for me
34:12 being an air table is often a better
34:14 solution awesome that is great perfect
34:17 well Lexi thanks for being on the show I
34:20 mean how can people get a hold of you
34:22 we’re at V got acquire. newsletter and
34:25 I’m on LinkedIn Alexis Grant um and
34:29 check out our data product it’s at
34:30 data.the got acquired. comom perfect and
35:33 we’ll put all those in the show notes
35:34 for those listeners so I guess we’ll
35:35 call it a wrap Lexi thank you very much
35:38 Lexi great talking with you welcome
35:40 thank you for listening to the m&a
35:42 Launchpad podcast if you’ve enjoyed
35:43 today’s podcast and would like to
35:45 support us please leave us a rating and
35:46 a review after you listen I’m Casey mchu
35:48 and I look forward to talking with you
35:50 next week
