Built to Sell Radio

If you're feeling a little queasy about the pace of change, you're not alone. AI is accelerating competition in almost every market, and it's making some business models feel irrelevant almost overnight. In this episode of Built to Sell Radio, John Warrillow talks with Ryan O'Leary, who saw a similar wave coming in payments when Shopify started bundling merchant processing into its plans. O'Leary chose to sell before the shift crushed margins, structuring a deal that put most of his cash in hand up front. In this episode, you discover how to • Decide whether to raise capital, hire a CEO, roll equity, or sell • Spot the early signals that a platform is about to "bundle" you into irrelevance • Run a tight sale process with a short target list and still generate multiple LOIs fast • Negotiate for deal structure that protects you, not just a higher multiple • Limit earnout risk by keeping the earnout short and the rules hard to game • Separate emotion from the numbers so you can negotiate clean • Keep your team aligned through the transition by sharing upside, including the earnout

Krista Gurka, a former physical therapist, successfully transformed her owner-dependent Pilates studios into a thriving membership-driven business. She shares how she broke free from burnout by implementing effective systems and hiring a COO. Krista recounts the emotional rollercoaster of negotiating the sale of her business, highlighting the lessons learned from a deal collapse and the importance of asserting non-negotiables. With her strategies, she not only improved profitability but also secured a clean exit on her own terms.

Ujwal Arkalgud, entrepreneur and founder of MotivBase, discusses his journey of transforming a services firm into a productized SaaS platform, ultimately selling for over 15x EBITDA. He shares insights on switching to unlimited support to boost customer engagement and the importance of on-call researchers for credibility. Ujwal also highlights innovative pricing strategies, the significance of a distinct brand philosophy, and lessons learned from a failed acquisition attempt. Post-sale, he reflects on personal freedom and his upcoming book, Invisible Rules, which explores hidden business expectations.

In this insightful discussion, Eric Wiklendt, Managing Director at Speyside Equity, reveals the inner workings of private equity and its impact on business valuations. He explains the crucial difference between 4x and 8x EBITDA multiples, emphasizing factors like risk and growth potential. Eric discusses how customer concentration can significantly affect pricing and shares strategies for navigating complex deals. With a focus on operational improvements, he highlights what truly makes a business a valuable platform in today's market.

Andrew Roberts is a seasoned software entrepreneur who transformed a family-run business into TinyMCE, a leading web text editor. In this discussion, he shares his pivotal decision: maintain a stable, profitable company or chase aggressive growth through private equity. He dives into the challenges of commercializing open source, valuing his brand as an acquisition currency, and navigating personal dynamics during the sale. Andrew also recounts unexpected crises, including a shocking acqui-hire, and how these experiences shaped his new venture, Deliverables.ai.

Chris Hutchins, a serial entrepreneur known for his roles in Milk (acquired by Google) and Grove (acquired by Wealthfront), shares insights on strategic exits. He discusses how companies can value non-profitable assets by focusing on team and product potential. Chris reveals the importance of reframing pitches to highlight product affection over revenue and managing quick acquisition processes. He also emphasizes protecting employees during transitions and shares lessons on the true value of assets in today's market.

In this chat, Spencer Dennis, an elite golfer turned coach, shares his journey as the founder of CoachNow, a platform for high-performance athletes. He discusses the chaos of managing coaching communications and the pitfalls of following investor advice, such as turning off revenue. Spencer recounts how unfavorable deal terms, like liquidity preferences, wiped out his equity and co-founders' shares during an acquisition. His key lessons emphasize the importance of charging early, avoiding convertible notes, and the true costs of chasing funding.

John Ruffolo, Founder and Managing Partner of Maverix Private Equity, shares his journey from accounting to tech investing. He discusses the stark differences between growth equity and traditional buyouts, highlighting how growth equity allows founders to retain control while securing liquidity. Ruffolo offers insights into how equity rollovers can fail due to aggressive cost-cutting and debt issues. He also emphasizes the importance of understanding pre- and post-money valuations and advises on leveraging debt before turning to equity for financing. A must-listen for founders!

Zain Jaffer, tech entrepreneur and co-founder of Vungle, dives into his journey from growing up in a refugee family to executing a $780M exit to Blackstone. He reveals the magic behind rewarded video ads and discusses the peculiar challenges of sudden wealth, including altering friendships and managing privacy post-exit. Zain shares candid mishaps in real estate, lessons from risky trades during COVID, and his philosophical views on wealth distribution. Now, he’s channeling his experiences into new ventures focused on AI in marketing.

Stan Marcuse, co-founder of Joyride Auto, shares his journey transforming impounded vehicle auctions into a digital marketplace. He discusses the challenges of traditional auctions and how digitization expanded the buyer base, especially during COVID. Joyride's unique business model led to impressive growth, resulting in a 7× revenue acquisition by a private equity firm. Stan also touches on his future ventures, including Ballast Cash Management, designed to optimize cash flow for businesses.