SaaS Acquisition Stories w/ Jaisal Rathee (JR), Founder with 6x Exits

Foreign.

I'm here with Junior, who has, I think, entered the micro acquire legendary club. He has sold or he has micro acquired five different startups or have had five different service mark required. That's incredible, man. So thanks for, thanks so much for joining the podcast.

It's. It's great to be here. Yep.

So for those listening, do you want to just give everyone just a quick background on yourself and maybe we can dive into the. Some of the acquisitions in a second?

Yep. So, I mean, I've been working at startups for a while now. I started my first project, I'm going to call it a project now, when I was 16 and I'm 28 now, so that's about 12 years ago. Still in high school when I started that and kind of been in and out of the startup world. I've had a few jobs in between. The first site that actually got micro acquired was a product service I started in 2020. Yeah, so I was working a job. I was head of customer success for a company and it's a really shit job. So, yeah, I started working on this productized service, which is funny because we launched on Product Hunt and I remember you specifically, you were one of the first commenters. You congratulated us on the launch. So it's funny that the six months after launching that service, we ended up getting micro quiet. Yeah, that was really cool.

Wrong world. Yeah, I always give like shout outs. Well, congrats on, you know, make the leap into entrepreneurship and then acquisitions too. So tell me about. So, so you got five acquisitions on your belt under Microcore. I think that might be the record. Tell me about your favorite one. What was. What's been maybe the most meaningful in terms of, you know, size or just, you know, I think, whatever. How are you Define meaningful?

I. I think the most meaningful would be my most recent one. It's called Insanely Useful Websites. It's a newsletter. And yeah, I wasn't really planning on selling this one, to be very honest. I started this about eight months ago, so December, December 21st I started this. And it's been growing really well. It's been doing really well. We had just under 5,000 subscribers. I had absolutely no inclination of sending it to about a few days ago. And I said, you know what, let's just, let's see what's out there. I've heard of. I'd heard of a few newsletters being sold, so I said, okay, let's list it on Microquire. You know, let's list it on a few websites. See what kind of interest we get and then we can make a decision 24 hours later. 24 hours after listing on Microquire, not only did I have a few people who were interested in buying, but I actually had my first real offer within 24 hours, which was absolutely insane. It was just shy of the asking price and the asking price was a really decent multiple. So it was something that I was very happy to sell at. So that was within 24 hours and it went super quickly. So when everything kind of fell into place, I had a chat with the buyer and he seemed like the right person to take over. So I said excellent, it feels right now. So within 24 hours it went from something I wasn't really looking to sell to it being the right, right fit.

That is crazy. 24 hours. In terms of an acquisition that may also be the fastest acquisition.

It did take a week to close, to be honest. We signed contracts within 24 hours. But yeah, with payments and everything, it took a lot. It took a bit longer.

Nice. What would you say your second favorite acquisition?

Second favorite would be be. Yeah, that would be my first one simply because it was my, it was my first exit on microguire. It was also within six months. So it's funny, I mean, you know, you might be, you might be listening to me saying I'm selling a website in six months. So I built this one. I sold it after eight months. But, but the reasoning behind that is, is very much that I'm trying to kind of build a micro startup studio almost. So it's more like a build to sell model and using kind of site like might require to, to achieve that. Or at least that's, that's where I, I see this going. So. Yeah.

Nice. So tell me about how many buyers reach out to you in those 24 hours in that 24 hour period.

In, in those 24 hours. Not, not a lot. But that was because I didn't give it enough time. You know, once you mark. Once you, once you receive an LOI and. And then it kind of pauses any interest, isn't it? But within those 24 hours I received about I think eight requests or nine requests.

Nice. Yeah, you didn't, you didn't give us enough time to put you in the newsletter, the social media post. So you might have had like probably more than you might.

I've had, you know, for previous ones I've had, I've had loads of 30, 40 and I mean I've had you.

Gotten your micro swag yet.

I haven't received It, I filled out that form a while ago. I'd say don't try asking for, you know, you see, you see a lot of, you see a lot of sellers trying to kind of, you know, they're asking for valuations which really don't make sense. They ask for multiples that way above, you know, what something would be worth. So it makes sense to kind of keep things achievable. It makes sense to kind of keep things realistic as well and, you know, look at your profit multiples and then see if listing it makes sense.

Yeah, I couldn't agree more on, on both points. This is saying there's been more lies told in Excel than word, so definitely. And then also a good quote to go along with that is from Warren Buffett. You can't do a good deal with a bad person, you know, so if you're.

Exactly.

If you're, you know, and yes, it will easily be caught in due diligence. So I highly do not recommend that. And then in terms of valuations, yeah, we see that a lot. And so what I always recommend, founders, is we have a multiples report out, which is real data from real acquisitions done on microcur. And if you follow that, guide your chances of being acquired or, you know, 100 times higher. But, you know, there is kind of like, it's hard when, you know, you see large companies being valued in the venture world at this and stuff like that. It's, it's, it's the hardest part of the job. And as a founder, I've done this myself where you think, well, they sold for 20x revenue. Why can't I? But it doesn't really work like that. Like your business is your business, is it at scale. There's so many different factors that go into, you know, valuing your business. And I even recommend sometimes to price lower than you might expect because then you'll draw in more buyers. There's another. If you have one buyer, you have no buyers. And so if you can get, you know, a bidding war going with a timeline saying, hey, I'm looking to sell this asset or this startup by this certain date, you can get multiple Lois. And that gives you a lot of leverage to raise the price and you're kind of letting the market tell you what the business is worth.

100%. Yeah, I think, I think it's perfect to, you know, kind of let the market do that. But yes, as for individual sellers, I think it's very easy to be greedy, as you said, especially if you see your neighbor, for example, getting acquired for 20x. But it's really important, kind of keep things in perspective and see, do you have the business that you know, that kind of gets that kind of valuation or do you need something that includes 5 or 6x range? But yeah, I've seen you have a ton of resources and that's actually really helpful considering that, you know, a lot of people selling a, you know, first time, selling nice.

And then in terms of like when you're, when you're speaking with buyers, what, what advice would you give buyers? Because I know a lot of buyers. I've seen buyers reach out, send Lois too soon, you know, short messages, you know, and all that really turns off founder and it would turn off me because it's just weird if they just are, you know, hey, give me all this information without actually, you know, showing that they're interested. You know, what advice would you give to buyers to really pique your interest and help them stand out?

I'll come to that in a second. But speaking of buyers. Yeah, there's some real tire kickers out there, I have to say. So one of the tricks, and this is for sellers and I just wanted to mention it's one of the tricks I realized early on, I think it was after the first sale was always asked for the buyer to jump on a call if they're interested because anyone who's kicking the tire, anyone who's not interested is not going to go forward because there's a ton of people who might reach out, but at the end of the day they're not really interested. So if you're a seller listening to this and you have a buyer who reaches out and you're kind of on the fence about whether they're interested, before you send them any information, just send them the basics and see if they want to jump on a call. That potentially helps. And there's also always that one buyer who tries to lowball you. Every time. A blissful startup, without fail, there's always that one person.

Yeah.

Lowballs you with like a 1.5x multiple or 2x multiple. Just says your startup isn't worth what you're asking for. I'll pay you this much.

Yeah.

So, so don't, don't fall for them. Even if they come in early, even if they come in within, you know, a few days of your listing, don't fall for those. If you think a startup's worth something, you know, stick it up. Wait, wait for it. One of my websites should, three months just. But it was worth it, you know, so it can take time. You know, it can happen in 24 hours, it can happen in a few weeks or a few months. But don't, don't let lowball offers, you know, demotivate you or kind of, you know, trick you into, into selling for less than your worth. But going back to your question about the buyers, I think buyers don't need to pique my interest. Really, all buyers need to do is say, look, I'm interested in buying. That's enough to, that's enough to peak my interest. Um, but yeah, I think, I think the previous, previous point about lowball offers and that, that's, it's almost a big, it's like a big turn off. And, you know, if you're trying to, if you're serious about buying my business, don't, don't insult me by offering something that, you know, you know, I'm not going to take the conversation forward.

Yeah, I would, I would agree with that as well. One, one trick that I recommend as well, if I love the, you know, you know, getting to know the buyer too, because you're, you're going to be working with this person post, you know, transaction, transferring assets, that sort of stuff. So again, going back to Warren Buffett's quote, you want to, you want to do a good deal with a good person, in my opinion. And one thing that's a really good quote. What's Warren Buffett?

I want that on my teacher.

Yeah, some other. Transferring assets, that sort of stuff. So again, going back to Warren Buffett's quote, you want to, you want to do a good deal with a good person, in my opinion. And one thing that's a really good quote, it's Warren Buffett.

I won't let on my teacher.

Yeah. Some other, some other tips we recommend is, you know, if a seller reaches out, make them kind of perform. And what I mean by that is, you know, they reach out with like, hey, my name is JR I have experience in marketing. I love your newsletter. Your next question should be, that's awesome. What specifically would you like to know about the startup? Or, you know, how do you, if we do get the finish line, how are you going to fund this acquisition? Okay, great. Are you comfortable signing an NDA? And what you're doing is you're making, making the buyer perform in terms of, you know, okay, you have experience. Okay, this is how we're going to fund it. Okay. You're comfortable signing an NDA, and all you're doing is just keeping a quick conversation going with the buyer to Kind of gauge your interest level, and a lot will drop off if they're not interested. And that allows you to just focus on the ones that are interested. So that's. That's another tip that I've heard.

It's just a small. Getting the small commitments as well, isn't it? And it kind of plays into the art of persuasion, just getting the small commitments and keeping the conversation flowing. Yeah.

All you're doing is saying, like, are you serious? Are you serious about this opportunity? Are you serious about this opportunity? Are you serious about. And then they say, yes, yes, yes. And then you also kind of get to know, you know, information that you probably want to know, like, how are you going to. How are you going to Finances?

Yeah.

So that fun stuff. So you are probably the definition of a serial entrepreneur. Building and, you know, selling.

That's a good thing or a bad.

Thing, you know, I think it's a great thing. We've seen that quite a bit on Microflower, where people are, you know, building projects and then selling them. And, you know, building is one of the funnest parts about a startup, in my opinion. You know, the initial phase, I love.

The first six months.

Yeah. It can be addicting. So I'd love to know, what are you working on now?

So a couple of things, really. I have a couple of productized services, but, you know, as I mentioned before, kind of trying to pivot my work into building almost like a micro startup studio, so which focuses on. On. On, like, projects that are built to sell. So purpose built to sell within a year or two years. Which is. I mean, it kind of came to me last year. When you're familiar with like the build to sell in 30 days kind of thing, right?

Yeah.

So I did build to sell in 30 way before build to sell in 30 was a thing. And so last year in July, I built a startup and sold it on Microquire within 30 days. And that kind of gave me. Thank you. That's. I hope that's another. That's another title coming my way. But that kind of gave me an idea. I said, okay, this is really interesting because what a lot of people are searching for is, you know, proof of concept, validation from customers, an MVP built out and kind of there's that early, early job done. So, you know, launching a few places and getting those customers and getting the product to a place where now someone can come in, take the processes, take over the processes and what you've built, and then scale it. So that kind of gave me an idea to start Building a micro startup studio. So what I'm trying to do now is building micro products for the purpose of selling them within the next year or two years. And by products, it's a general term. What I mean is it could be productized services. So I run two product services. One's in the cold email space, one's in like the webflow development space that are on info, products, content, businesses, and another newsletter, so similar to the one that I just sold. And it's all kind of, you know, leading to a point. But yeah, it's very easy to overstretch yourself, which I think I've done a few times.

I think every entrepreneur has. But this, this is awesome. This, it's almost like I can see a future where, you know, people are able to build products specifically to sell them to someone else, and then you get to go back to doing what you love, which is building more products.

Exactly. It's all about playing to your strengths. Right. I'm not the person to take a business from, you know, 100,000 to 10 million, but I might be the person to take it from 0 to 100,000 and then someone else can come in and do what they do best, which is scale it further. I've seen lots of people, people struggle with starting. Starting sometimes many people is the hardest bit. Um, and if you can take that away from, if you can take that, that initial, you know, it's getting that inertia, it's the hardest part to get the ball rolling, to get the, get the car moving. And once you get it started and someone, someone else can come in.

Nice. I like that a lot. So I guess, you know, final questions I would have for you is how did you learn all this stuff? Are there any, you know, books you'd recommend or podcasts that you listen to?

YouTube. YouTube is my by far my favorite resource. And everything's on there. I do listen to a few podcasts. They're great for listening to, not necessarily for learning. But, you know, my personally announced, that's one of them. And I really do like that podcast. But yeah, YouTube has, has so many people who are just freely sharing, you know, all their knowledge and kind of what they're learning. In fact, you know, I started my local journey looking at YouTube tutorials based on what people, you know, how they were building on Webflow and, and all these different apps to YouTube. I mean, that's, that's all you need really. You don't need anything else.

That's incredible today because 10, 10 years ago, we did not have that. Building a startup 10 years ago, everyone was just trying to figure it out. Like we had some idea. Like I, I built a startup and launched it in 2010 and there was not a lot of content on sales, marketing. Everyone was just kind of, maybe this will work or.

And. And it was, it was. At that time it was the same old books being, being, being recommended. It's like, oh, yeah, get. I don't know if I should name names, but I'll name them anyway. You can edit them out. There were, I think Steve Blank had a book. What was it called?

I remember that.

And then there was the. Something about the peaks and the. I have all these books crossing the chest. Yeah, that's the one.

Steve's Blank spoke is like the path to epiphany, I think.

Yeah, that's the one. That's the one.

Yeah, yeah, yes.

There were all these books.

I read those in college. Like I.

Every one of that stage, I think was reading those books, hoping that, you know, there is an epiphany at the end.

But I will say at the time those were, those were great books. But then as what's been, I think really amazing to see and I think this is what I love most about startups personally is just how much other entrepreneurs share like yourself. Like, you're giving fantastic. Even though you just said YouTube. That is a great tip. Like, yeah, just go on YouTube. Like, like sometimes. Yeah. Or, or Google. Sometimes I'll post something on, say, Twitter and someone will have a very basic question. I'll just say type it into Google and if, and if you literally copy and paste the question into Google, you'll get tons of content you can do in YouTube, which is funny.

You almost need more people. More people need to oversimplify stuff because I think at this point most people tend to overcomplicate stuff. It just doesn't need to be. Doesn't need to be that complicated.

Yeah, I think, yeah, there's always, there's, there's beauty and simplicity. I think that's. That was Steve Jobs motto in terms of, you know, what could he remove from products rather than add to two product. And I think that's.

I think, I think I'm gonna give you that quote. I think beauty and simplicity by, by Gavin.

Yeah, I think, I think it's like a famous artist.

It's a quote from someone that's going on my coffee.

The, the micro choir coffee mug when we get it out too.

Excellent.

All right, Jared, well, it's been a pleasure chatting with you and dude I'm. I'm just so thrilled at all your success and I'm rooting for you. If people want to learn more about your journey or learn about. More about your new projects working, they go.

I think Twitter would be best. I'm definitely trying to. To be a bit more active there. So, yeah, just. Just follow me on Twitter. I think you can leave a link in the description. That should be easiest.

I'll. I'll look up a YouTube tutorial on how to leave a link on a YouTube video.

Just Google it. Just Google it.

Back at me. Well, it's been a pleasure chatting with you. I'll put all the links in the show notes, but, man, congrats again. And we'll definitely be getting. I think. I think we owe you, like, four swag boxes, so you might be getting a.

The thing is, you. Yes. It's recorded now, so once it's up on YouTube, you can't go back.

I'm a man on the word excellent.

Yeah. It's been a pleasure speaking to you, Andrew. Have a nice one.

You too. All right, cheers, J.R. all right, cheers.

Bye.