How Emmett Cooke Sold His SaaS Business for a Life-Changing Exit

All right. I'm here with Emmett, the founder of Pulse. Emmett, how you doing today?

Good, thanks. How are you, Andrew?

Doing good. So you recently got acquired. Super excited for the story. To kick things off, do you want to just give an introduction of yourself for people that may not know you?

Sure. Yep. So originally I'm a composer for film and TV. About 15 years ago, I got into the music industry, started writing music for film and tv. And when I was there, I guess I spotted the gap in the industry for delivering music software. So that was where I started to get into Pulse and start building the company from there. But originally I just wrote music for TV and kind of fell into the business that I sold.

Nice. That's awesome. Any TV shows?

I would recognize a lot of the junk ones. So Toddlers and Tiaras, Wives with knives, all the junk stuff. But, yeah, stuff on the History Channel, Science Channel, NBC. Obama actually used my music for his presidential campaign, so load quite a large range of stuff.

That is awesome. Tell me about Pulse. What did it do? What problem did it solve? Let's go from there.

So when I first got into the industry, it was like. Like I said, it was about 15 years ago, and whenever you'd buy software, it would always arrive on DVD. So it started with CDs, and it started with DVDs. And I remember the first load of software that I bought was $5,000. I had to get a student loan buy it. And so it was really expensive. And it came in a stack of DVDs. I think there was 200 DVDs. It was like this giant package DVDs. It took about a day and a half to put all these DVDs in and out of the computer. And I remember thinking at the time, there has to be a better way to do this. Like, this seems absolutely crazy. So it was always in the back of my mind, I never knew what to do with that idea. And then as I was in college, I had seen Steam, which is the video game platform, and they were delivering digital files for video games. So I always thought it would be cool if somebody did that, but just in a different industry. So if it was specifically to music software, that would be cool. So. So that was where that. That idea came from. So I always had the idea to do it, but I just didn't know how to get into it.

Right on. And then how'd you get the first customers for that? It sounds, like, kind of complex to build something like that, right?

Yeah. So I guess I. Before Pulse, I had also built a Music software deals platform. So I had grown the E commerce side of music software sales so I knew what the industry looked like and I knew how all the different companies in the music industry worked in, in terms of how they delivered their. But I had no idea of like how to build it. So I literally went on to upwork and found a. I think it was like a Ukrainian developer and I explained what I wanted to build and we actually found an open source platform out there and called Itch Itch IO and we looked at that and sort of thought maybe we could take some of the open source stuff, repurpose it for what we wanted to do. But it turned out that that was a really bad idea and we have to go back to the start again. But how I built it, I had no idea about any of the technical side of things. I literally just went to a developer, explained the concept and I let them kind of attack it and figure out the best way forward. So the actual process of building it then was like I said, I went to upwork. We tried using the open source platform but it was a nightmare because what we found was as we tried to take that apart and make it work for our solution every time we'd go one step back, we'd have to go two steps forward and we'd add one feature and we'd have to unthread lots of other features. So we tried going the kind of use open source route and build what? Use build on what's already out there. But I burned a lot of money in the beginning just doing that because I didn't know the downsides to it. So we had a lot of technical debt and we had to refactor it. So after that point the developer said look, we've got, this is a massive project, you should take somebody else on as well. So I expanded the team then to another senior developer, he brought on three more developers. So there's a development team of four. I had to fire one of the developers because he kept going off and kind of doing his own thing with the software. So we went down to three full time developers. We built out an actual plan because I never really had a plan. I was just like, this is what it should do. We never had a roadmap like where to add different features because I had no experience doing any of that. So I learned a lot along the way. But yeah, that was how it was built based upwork through contractors. And then as all the features were built out we scaled the size of the team down and just focused More on the marketing and sales side of things.

Nice. If you had to just give any advice for maybe another non technical founder looking to build something with upwork, like what would, what advice would that be? Because it's so rare to meet someone that, you know, successfully hired engineers off a place like that, made it all work and then exited the business like you.

Yeah. So I think having like real specific goals and a real specific roadmap to get there is really important. I kind of floundered my way there. I think I burned more money than I should have done or that I needed to just because it was kind of, a lot of the time I thought that I'll just let the developers figure it out and they'll figure out the best way forward. But if we had all sat down together and sort of decided on the best way forward, it would have saved a lot of time. I think I should have become a lot more better at managing people. I sort of just left it to them. If I had been better at managing people, managing the team, managing expectations, that would have been a lot better. But nowadays, because I mean so much has happened in the last couple of years with AI and stuff and that as a still non technical developed founder, I think that AI can do quite a lot of stuff that it just wasn't possible to do when I started this platform five years ago. So if I was a non technical founder now, first of all I would try build like a very basic mvp. With AI it's not always possible because it can't do everything, but definitely I would build a very basic version of the mvp, get it working like at least clickable, doesn't have to function properly, but at least clickable and then go to a caliber and go, this is how I kind of want it to work and hackable functionality in it. So it was very difficult to kind of take that vision and see what the final product would look like. Whereas with AI nowadays it definitely helps a lot to be able to kind of create something basic at least and to be able to show people. Yeah, that would be the important. I would say.

Yeah, I mean AI is just changing everything. Being able to create, you know, small MVPs or prototypes and literally days instead of hiring people is pretty crazy. Tell me, how did you get your first customers? You build the product, what happens next?

How did I get the first customers? So I mean the niche that I was in the actual music software industry is probably not that big of an industry as a whole. There's about 10,000 companies in the entire industry. At most. And I would say the top 50% in sales is probably attributed to maybe like a hundred companies. So it was relatively simple to reach out to all the companies because I already had a lot of their contact details from my previous e commerce company that dealt with music software sales. So I literally reached out to them and said here's what I'm building, here's how it can solve your problem of like difficult customer support. Customers having to download products through their browser, having to email support their support teams a lot. And I basically said here's your problem, here's the solution I'm building and here's how much it's going to cost. It took a very long time to actually grow it because like to get companies on board. Because what I actually found was it wasn't a case of the solution was bad. It was a case of it required a change in culture, I think within the industry. Like people had always used download links through their browsers so or like buying DVDs and getting them shipped in the post. So it required a real shift in just culture and people, people's expectations of how they receive software. So a lot of people started to push back on it and like people assumed it was a data privacy thing or it was, oh, you're harvesting my data. So that was more the pushback rather than getting the companies on. And it was more like companies customers pushing back. But how I actually got them on board was just literally just emailing them, meeting them in person at in person events. So there's a large music software conference every year in California. So I went to that for every couple of years and that helped. But again, because it's a small industry, I found that once I reached out to a couple of companies and they were using the platform, word of mouth grew it a lot then as well. So I never actually had to market the B2B side of it. The B2C side we did. But the actual B2B side side where we were offering the platform for companies to use and never actually did any marketing for that. It was always just through word of mouth or through warm contacts that I had built up over the years.

Wow. What was the business model on the B2B side and the B2C side too?

Yeah. So on the B2B side it was a revenue share. So we would take a percentage of each company's revenue. So for a small company starting off, obviously it was a great deal for them. For larger companies as they grew and as we added extra features that they wanted, we would grow with them too. So on the B2B side, it was a revenue share for every product that we delivered. And then on the B2C side, it was a E commerce store within the app. So as customers use the app to download products, they could also use the app to purchase products, which is where we would sell the products to them through the store. And we would receive a, like a higher split on the sale of products through the E commerce site.

Nice. And then how many customers did you have when you ended up selling the business?

So on the B2B side, I think there was over 100 anything. And then on the B2C side, the actual platform had grown to around about 360,000 users in, like, the database, with around a thousand to two thousand daily active users within the desktop app.

Wow, that's incredible. Tell me what made you make the decision to sell the business?

It was a couple of things. So, um, I kind of feel like everything comes in cycles. Just as a. As an entrepreneur, it's like the fun part is building and then the less fun part maybe is scaling. And I kind of found like my energy had started to die out a little bit where I had got through the fun part. And I couldn't see much. I couldn't see much more fun in what I was doing, really. It was becoming a bit monotonous and I wanted to move on to other things because I had lots of other side projects on the go. So that also came at the time where there's a tax break in Ireland and it just made sense to take advantage of us. So. So when I sold the company, I was able to take advantage of a far lower tax tax break compared to just paying myself through the company. So that was also beneficial as well. And then on top of that as well, we had a second child and it was just becoming quite difficult to balance my time with it all. So all of that, the other side of it was as well, I guess. Like there was a growing anxiety, I would say, from just managing it, which I never really hear people talking about. But it was this kind of. Sometimes I'd have this sense of dread where I was providing a service that was important to. And if it went down, obviously, I'd kind of get really upset and I have to work through the night to fix it. And I had a couple of those nights towards the end, and I just didn't want to do it anymore. It was just those. I was really stressing out about it and I just kind of figured there's better ways to do this, and I want to build something new.

Yeah. I mean, that's super smart. If you're feeling like, you know, you're losing energy, it's not exciting anymore. That's a great time to sell, especially if you're already working on other things. I hear that all the time for founders.

Yeah.

Tell me, when you walk me through the process of listing on acquired going live, did it meet your expectations? Any surprises? But you create the listing, you go live. What kind of happened?

Yeah. So, I mean, even to get started, I was surprised at how, like, easy it was. And so I remember putting in my details. I got the valuation and then had the advisor assigned to me, and it was ebony, so she worked with me the whole way through it. And it was just. It was really easy. I had no idea how any of that worked in the first place, and it was just very, very simple process. So, yeah, I put all my financial information together, tried to simplify the P and L. I created a video just explaining what the platform was and how it worked, put all that together, created the listing, and then I think it went out in a newsletter one of the days, and I woke up the next morning and it was like 50 or 100 different requests to view the listing. So it was really impressive. I couldn't believe that my specific little niche product that was doing great in revenue, but it was such a niche little industry. I never thought there'd be any interest in it. So I was really surprised. I was surprised by the variation in the different industries where people were interested in as well. So, like, there was. I think it was venture funds. There was people who worked in the music industry, people who worked in completely different industries, individuals, large corporate companies. So, yeah, it was just. It was crazy to see the. The variable size of the companies and who were interested in it. So most people applied to view the listing. I got back to everyone really quick, sent them a message. I continued to create living Q and A, so anytime I had questions, I'd add it to the Q and A document. And then every week I would just send out a link and say, hey, the Q and A has been updated. Here's the link. If you have any other questions, let me know. And I'd include my calendly link in there as well. So I think there was something like maybe seven, eight meetings booked in. Then around three of them went to, like, second and third round meetings. And then somebody had emailed me and they were interested, and it was a competitor. And, yeah, kind of it started to just take off from There then. So had a couple of different offers and different people who are interested. Some people put in informal offers and some people put in formal offers. And then I think it was like late November when the final offer was completed and yeah, closed right on.

What was it about the winning buyer that made you move forward with them? Was it the price or terms? Was it everything or how you got along with them?

Yeah, so it was important for me because like this was a passion project. It was important for me to make sure that whoever was taking over the platform shared the same vision that I did. And because I know it's sometimes a company can take it over and kind of bring it in a different direction. So I wanted to make sure that everyone was continued to be taken care of when the platform sold. So the competitor, when I spoke to them, shared all of my vision and I was really happy at that point to move forward. But I was also clear that I wanted cash up front because specifically for the tax break it needed to be cash up front. So that was one of the reasons why we just, we moved forward because all the terms and their vision aligned with mine as well. So that was, that was why.

Nice. Did you negotiate against any other offers? Did you go back and try to increase the valuation or improve the deal terms? Because when you get a lot of offers, it's such a good time to negotiate. Did you do anything like that?

Yeah, so I guess I was a bit wary of pushing too far really as well because where I had like we had valued the business right in the middle of the valuation range and I think that's fair. And I think they were getting a fair deal and they offered a fair price. So I wasn't really like with the size of the money we were talking about as well, I was, I wasn't really gonna penny pinch and kind of potentially lose the deal. So I was just happy with, with the closing offer. So yeah, I, I did. We did negotiate a little bit. So it went back and forth maybe I think three or four times, but not drastically, I would say.

Nice. So when the wire hits your bank account, you have the funds, the deal is completely over. Did you do anything to celebrate? Because the amount, it's a life changing acquisition. Did you buy yourself anything? Did you go celebrate? Like what'd you do?

Yeah, it's funny, I still haven't. But yeah, it's a funny one. I've watched loads of videos of people talking about this and yourself as well and like, yeah, I don't know, like we were in a good Position beforehand. Right. So, like, we have no mortgage, but we. We were doing up the house, so we were renovating the house. So renovations kind of took a. Maybe a bit more of a steep renovation. But no, haven't done anything crazy. But what I do want to do to celebrate is book a board game cruise. It's a very niche thing, but love board games, love cruises. So I want to go on a board game cruise. Actually, one thing we did do was we booked Disneyland for the family. So we're all going to Disneyland.

Right on. Walk me through. Due diligence. How was that process? How long did it take? Any surprises there or learnings?

Yeah, so I had no idea what that would be like. I sort of did a bit of due diligence with one company and because of the structure of what I was selling, like a limited company in Ireland that was a bit complex with the actual end company that we sold to, Due diligence was, I would say, quite straightforward. So I basically identified every single account that I have, like bank accounts, any financial accounts, any logins for anything within the platform, and the company identified all of that. We went through all of the bank statements, all of the bank accounts, identified any transactions, and then I gave them access to every single account and sort of transaction, and we went through them on a screen share that lasted for maybe, I'd say two to three weeks, which I think was quite a short period because I know it can go on quite longer. But it was relatively straightforward in that we had a roadmap and a process for it. And I worked with Ebony, the M and A advisor, to kind of build that out as well, of like, how that due diligence process would work. So it was actually quite straightforward and there was no issues with it in the end. Yeah. But I know it can be a bit more complex depending on the way you're selling.

Yeah. I mean, sometimes it's, you know, at least 30 days, but 60 days is not uncommon. So that's fast.

Yeah.

Nice. Tell me this. If you were to, you know, sell another business, give yourself some advice, maybe, you know, before you went through all this, or just another founder looking to sell their business, what do you think those three pieces of advice would be?

So somebody who wants to sell their business, just in general.

Yeah. They don't know anything about the acquisition process. You've successfully been acquired. What's the top three piece of advice you give them?

Yeah. So the first thing I would say is start like 12 months before you actually want to sell, because I think that's really important. So start getting all of your documentation, all of your accounts, and cleaning everything up at least 12 months before. So one thing I never really thought about was, for example, I have like an Amazon account and it's under my personal email address. So it was really difficult to like, pull that out and actually put it into the company. So start like putting everything, segregating it all into like that container of your company. Start cleaning your financials up and making it really clear, like really tracking what your, what your profit and loss is, where your money's been spent, because that's really important. Then I think over that 12 months, really try and maximize and push your business to scale the revenue as much as you can. Because how much it scales in that 12 months, even if it grows like, you know, 20, 30, 40%, like, that can massively increase your valuation, especially because people see it's on an upward trajectory. Whereas if you just get burned out, decide, you know what, I'm just going to sell, it's probably going to be on a downward trajectory. So I think knowing in advance when you want to sell is really important and identifying that. And I think, yeah, like, for me, I did the right thing in selling because I was starting to feel burnt out and I did want to move on to new things. And like you said, I think just being aware that that's okay, but like, you don't have to stick with your company forever and like that there's always new opportunities out there and there's always new, new innovations happening that you can jump on. So, yeah, just being okay with kind of selling it. But one thing I would say is that I didn't expect and be aware that you can kind of tie your identity to your, to your business and like, that disappears when you sell your business. So there's a, expect like a couple of weeks afterwards, kind of this uncertainty where you sort of feel like, huh, I don't know, what should I be doing or where should I be spending my time? So that was something I didn't expect to happen. I just thought, you know what, get loads of money, sit back and you don't have a worry in the world. But your worries replaced with another worry of, oh, now what do I do and where do I spend my time and what should I do with the money? And so I think just being aware that that will is really important too.

Yeah, that's great advice. I love that. What's next for you? I mean, what are you working on? Are you taking a break? You're building something new yeah, loads of stuff.

So I've been kind of keeping up with all the latest AI development platforms like Lovable and Replit and these kind of things. So with the latest release of Claude, it's kind of a deal for someone like me who's not technical, but I have a good idea of what I want the end product to look like and how to build out the features. So a couple of weeks ago I pulled my back and I was laid up in bed for a week. So I started working on a platform using Replit and I struggle with problem, specifically in Ireland, where it's difficult to file a particular tax form for. If you trade a lot, you need to collate all those trades and figure out what the tax is. And there's loads of different steps to it. So I figured I'll get an AI to help me build this platform. So this time around I built it, I built an mvp. I, rather than trying to finish the product and actually sell it, I've just got beta users to start using it. I built a landing page, started advertising it and getting waitlist signups. So I'm kind of experimenting this time around to build a business and start selling it before it's ready and not having to spend all that money on developers to kind of get that mvp. Just work using an AI platform. So, yeah, I'm kind of just experimenting and having some fun. And I think I'm going to start adding a YouTube channel and LinkedIn and start posting about the progress. But it's a lot of fun.

Right on. Excited to see where that goes. Maybe we can help you sell the second business whenever you're ready, hopefully. Yeah. If people want to learn more about your story, where can they find you online?

Good question. So I have. I'm on YouTube. I think it's. It's Emmett Cook and I'm on LinkedIn as well. If you search Emmett Cook, I don't think there's many Emmett Cooks on there.

Right on. I'll put down the show notes. Emmett, huge congrats again on the acquisition and thanks again for coming on.

Thanks, Andrew. See you.