Sold: A Shopify Theme Business with Cory Lynch, Founder of Solodrop

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I'm here with Corey, the founder of Sodo Drop, who recently got acquired for six figures. Corey, how you doing today?

Good. Thanks for having me, Andrew. Appreciate it.

Yeah, thanks for coming on the podcast. Before we get into the business. I sold it, all that fun stuff. Do you want to give listeners maybe a introduction of yourself for those that may not know you?

Yeah, for sure. Yeah. So founder solo Drop. Basically just a Shopify theme that's put on, you know, you can use on Shopify. But yeah, like I said before we get into that, I'm a software engineer. I went to college to learn how to basically just build my own products. But, yeah, just entrepreneur at heart, you know.

Nice. Have you started previous companies in the past?

Yeah. So this goes way back to high school, actually, where I, like, tried to start. Uh, you know, it's like kind of like the classic, like, high school college app where it's like, yeah, I want to. I want to party with my friends. I want to meet, you know, meet new people, I guess, and like, kind of have your own group. And I decided to start something called Click. It was K I or K L I K. And that was. That was kind of interesting because I tried to start this app in high school, but it didn't actually get any works. I didn't really have the funds. I had no idea how to build anything at the time. Um, that was like, my first thing. I think I was like, probably 17 years old and. And I went on. What was it? I think I went on. I tried to go on Kickstarter to do some crowdfunding to like, get some. Raise some funds, to. To do some development. At the time, this was, you know, development was probably triple the cost, you know, than it is now to. To get this sort of thing done. What year.

What year was this?

This was probably. I would go with like, maybe 2010.

Iphone apps now. That's when it was all getting started.

Yeah, for sure. And I was like, I was super stoked. I. I learned a little bit how to, like, Photoshop, like a. A logo e, write down my whole idea. And it was funny because I was on, like, the local news as like, this kid who's trying to start some app. But I was like, I felt like it was so goofy at the time. So I was like, I didn't even do anything yet. You know, I'm just like, I have like, basically an idea that I'm spreading around my high school. So I went on Indiegogo because Kickstarter didn't actually. I think it Was like a social thing. So they were like, yeah, we don't do social apps. That was, that was Kickstarter's, you know, feedback for me and I was pretty bummed. But I went on like indiegogo and I think I raised like a little bit of money from some family and friends but ultimately that thing kind of just like fizzled out and died. But what was really frustrating for me at the time was that I couldn't build it myself, or at least I didn't think that I could. So that's actually what kind of gave me the idea to go to college to learn how to become a software engineer because I wanted to just build my own things. So yeah, that was like my first company that I tried to build. I have another really interesting one in college, like while was learning how to become a web developer and software engineer, there was, it was called Ditto D Y D D O. And that was like a challenge, remember like the, the cinnamon challenge.

And I don't know what was it?

Ice, Ice bucket challenge where you like put the ice bucket over your head.

Oh yeah, yeah, yeah. That was, that was huge for a minute.

It was huge. Yeah. So there was a lot of, a lot of like these challenges going around and I, I was like, man, there's not like a platform for this. You know, it's kind of like sort of done on like I think at the time it was like four Facebook. And so I, I, I built this platform for it. I only could do like the front end for it at the time. And then I just worked with someone to get the back end done and I had this like whole site where you can like create a challenge as a host and then people could submit it and stuff like that. So I had like a little small ecosystem, but I thought it was worth nothing and I just let it like kind of fizzle out as well. So yeah, those were a couple like of my earliest projects that were like you know, 10 plus years ago. But yeah, yeah.

So you have been an entrepreneur for, for quite a while. So now I'm wondering in terms of solo drop. So you made, I'm sure you made other things before solo drop. That's just kind of. Have you, can I zoom that?

Yeah, yeah, yeah. So I, I did a lot of like actually non technical businesses in the past, I don't know, like six years because I've been doing Shopify stores. I've been developing Shopify stores for maybe like the past six exclusively. And that's for my day job, but on the side I was like, well, I'm seeing all these stores making, like, ridiculous money, you know, off of it. Off of just selling, like, pretty basic products. So I did the whole drop shipping thing, like, a while ago. That was, like, my first, you know, shot at that sort of thing. Yeah, just a bunch of stuff that I didn't really know how to do the marketing for. I'm not a marketing guy, so that's sort of like where I let things die in my journey. But I think with Solo Drop, I learned a lot from. From marketing and how to get it done, pretty much.

Nice. Let's talk about that then. What does Solo Drop do? I know, because I'm looking at the website, but what is a product? What problem does it solve, and what motivated you to start it?

Yeah. Yeah. So like I said, I've been building Shopify stores for the past six, seven years exclusively as my day job. It's just, like, something I fell into. And because I started building a lot of these stores and these themes. If anyone knows. If anyone doesn't know what a Shopify theme is, essentially it's like the storefront of your stor. It's what the customers interact with. It's how they get from, like, point a landing on your site to checking out and actually converting. So it's. Your entire site is like a Shopify theme if you're on Shopify. But, yeah, the way that I thought of it was that I felt like I had this unfair advantage because I knew everything about Shopify themes. I mean, I was sitting here all day just developing and coding for Shopify themes. So I had the insight of a bunch of these really massive stores that I got to go on the back end of and see, you know, what works. Like, what is. What is working for them. Like, you get the marketing team requesting us to build a certain feature. And, you know, I would see that consistently across, like, a bunch of sites that I built for. For all these brands. And I was like, man, like. Like, a lot of these are. Are just, like, apps that people installed on their Shopify store. Or maybe it was something that they just requested to build, and it cost them, like, thousands of dollars to build a specific feature. So, long story short, Shopify is like. Or, sorry, Solo Drop is like a collection of all of these awesome features into one single Shopify theme. So this is a really powerful Shopify theme that it, like, empowers merchants to just have, like, really, really cool selling tools to sell, to sell their products.

Nice. I love how you. You have, you know, domain experience in Shopify. And then you built a really successful Shopify app just based on what you were seeing in your day to day client work. I think that's like one of the best ways to build a business because you're seeing the problem firsthand. It sounds like you just productized it. Is that right?

Yeah. And it was something that I avoided for a while too, because I wasn't necessarily like, it wasn't like my first choice in terms of what I wanted to do next. You know, I always have some sort of side project going or some sort of itch to do something else, but it felt like it had to be done, you know what I mean? Like, it was something where it was like, all right, man, like, I know how to do this, like, I'll just do it.

You know, you had to scratch the edge.

Yeah. So it just felt like the obvious next step, you know, to make a business at the time.

Okay, so you, you built the product. You, I assume you started getting, you know, customers probably through the Shopify ecosystem. Did you have like a moment where you, where you feel like you really hit product market fit, where you maybe had a day where you stepped back and you're like, huh, Solo Drop. There's a lot of people signing up for this.

You know what's crazy is that I love that question. So I think it was actually, believe it or not, it was this year and it was about probably four or five months before I actually sold, sold Solar Drop. So I also had a moment last year. So there's a couple points in Solo Drop in the Solar Drop journey where this happened. It's super interesting. So just to give you a quick recap of the timeline of Solar Drop. And so this makes sense. But I started it in somewhere in the pandemic. Right. I built it on the side for a while, just completely solo, decided to code the whole thing. But once I got it out there, it was a serious struggle for me personally because I've never really, really, really tried to do solid marketing on a product. I've always sort of just like either gave up early on with marketing or try to hand it to someone else to help me with marketing or something. So I was like, no, this one I'm going to learn, you know, marketing. And it took me a while to get to that point, but it was, I think it was last year in January where I was like, all right, let's just try TikTok. Let's just try the whole social thing and see if I can make like short form videos for A Shopify theme, which seems super counterintuitive. I felt like, it felt like not a fit for me, but I was like, let's just try it. So I made a TikTok account and within like a month, I think I got like 1.5 to 2 million views on a couple videos. And it did really well. Yeah. And it generated like, I don't, I don't know what it was. I think it was, it was like getting close to like 10k in revenue for the, for the business. And I was really like, okay, well I can actually go to cold traffic and just like, you know, get them to convert, which was super interesting. And you would think that I would just keep replicating that, but I didn't because I actually didn't enjoy making the content myself. It was like a huge. I don't know, I don't know if it was my thing at the time to just keep making TikToks. It was kind of like, I, you know, you hear that a lot from like YouTubers and TikTokers that it's just sort of like this hamster wheel of content sometimes. So I was like a little bit afraid of that and I decided to just, you know, capture the. All of the potential customers that didn't convert, like their email, all that stuff. And I waited a while and I got, you know, it was like a few months after that point where I was like, maybe I should, maybe I should, you know, potentially sell solo drop and fast forward like eight months later, I think it was, I decided to make it into a subscription model where it was like no longer $200 lifetime. It was actually $20 a month. Yeah. And that's where just a lot more people signed up. Because at this point a lot of people already knew what solo drop was. It was like getting embedded within the community a bit and a lot. That's when it started getting like, you know, real mrr. And there was actually like a lot of people who were signing up at that point. I think it was, it was really that point when I made into a subscription model where I felt like, okay, you know, there's. This is like really working. Like this is a real, it felt like a real business, you know, at the time.

So yeah, I think, you know, when you have like the one time payments every month, you gotta have that amount of money coming in, but if it's recurring, you know, you can predict the revenue out. So, you know, next month, even if no customer comes in, assuming your churn is low. Yeah, you know, you, you really have something on your hands, and then it makes selling the business a lot easier. And then also, you know, increases the valuation. So that. That's a good move that you did that.

Yeah. And, you know, that was something that I wanted to do since, like, I don't even know, man. Like day two, probably a solo, like just conceptualizing solo drop, but, you know, that, that was something that I. I felt like I had to do before I. I sold it. Like I said, I considered selling it like eight months prior to doing that. And then I was like, you know, maybe let's just try this whole subscription model thing. And it ended up working out really well.

So nice. I mean, I think, you know, when you're first starting a business, you know, giving away, you know, lifetime deals can be good, but you definitely want to switch over to, you know, a recurring revenue model at some point. The sooner the better. But the cash up front, you can reinvest into marketing. I've seen that strategy play out. But then if you have a cohort of customers where they're like free for life, but you still have to support them, that isn't as appealing as the recurring revenue. So it's awesome that you made that switch.

Yeah, for sure. I think it's easy to do that too. Especially you look at your competitors and you're like, well, what's working for them? And a lot of the competitors are just doing a lifetime. And if you look at the Shopify marketplace for themes, which is not something that solo drop was in at all. It was completely third party. All the marketplaces place themes are, you know, completely just one time purchase. So, yeah, I agree with what you said. It's. I think it's. It was much better after implementing the subscription model.

Nice. So let's move on. So business is going good and you got customers paying you every single month on a subscription basis. Was there like a day where you just said, okay, I'm gonna sell this thing and. And put it on acquire.com?

Yeah, I don't think there was a day. I think it was a pretty gradual decision, but it was more like curiosity over time. Right. Because I started seeing these customers retain, like, actually, like pay each month. And after a few months, that's when I was like, you know, starting to get a little bit curious as to, like, what can I try evaluating my own business and see how much it's actually worth? And once I started thinking of that, that's when I was like, yeah, I mean, maybe I'll just give it a shot, you know, and it wasn't necessarily, like I said, like a moment, but it was definitely a gradual decision of is, you know, just over time of, like, maybe, maybe I'll just see what happens and, and see if, you know, is. Is this real? Essentially, because this is my first business that I sold, so I didn't prove it to myself at this point that someone is actually going to want to buy, you know, a business for me. So, yeah, so at that point I was like, let's just. Let's just list it and see what's up.

Yeah, I mean, when. I'm sure when my team saw it come in, because we see Shopify apps sell, you know, very, very fast. So I'm really curious. Tell me about, you know, the first two weeks you go live on acquired.com what happens? How many buyers reached out? What was your experience like?

Yeah, it was. Again, this was my first time, like, listing a business at all, so it was really cool to see. Yeah, I definitely got a bunch of prospective buyers, like, in my inbox pretty quick, and I was actually pretty shocked to see that they were not, like, low value, I guess you could say, you know, like, like everyone that I talked to was like a real person that actually wanted to chat about it. And, you know, like, honestly, I half expected to get some just buyers that are just completely just like, hey, what's up? This looks interesting. And then never talk to you again. But, like, pretty much everyone that I talked to was, like, willing to do a call or, you know, just like wanting to chat or get some more information. But yeah, it was a lot. It was a good amount and it was overwhelming, I think, initially. But yeah, it was. It was a really good experience overall.

How many. How many NDAs did you get in total? If I can ask, how many what? NDAs?

Oh, I don't remember, actually. Yeah, I don't remember. But it was. It was a good amount. It was like more than I personally expected, you know, being like a, you know, quote unquote, like, smaller business. So.

Nice. Okay, so, well, definitely good job getting on, you know, phone calls with buyers. I think that's a crucial mistake that a lot of sellers make is they think that you just listed and then you just kind of wait around and then someone's like, I want it. But I'm sure as you went on buyer calls, you realize, like, there's a level of trust that needs to be built and obviously, you know, additional information that buyers need to actually make an offer.

Yeah.

So I guess, you know, another question is, did you do Any sort of preparation for that position in terms of like a transition guide or common questions or just showing metrics or anything like that?

Yeah, I think, I think I thought I did and I really, I don't think I prepared enough to be honest with you. So I'll be the first to say my finances with Solo Drop were like, it was like. So it was very, like just very muddy. You know, I kept this on a very personal level. This felt like no one was ever going to see and no one is ever going to touch this besides me. So I tried to get the finances in order beforehand. I know that you guys encourage a P and L. So I definitely was, okay, let me get a P and L. And I put that up and I connected it to maybe QuickBooks, which I did not have. I had, I did not have QuickBooks at all until the selling process. But I think that was the major thing was like, okay, let's like start thinking about other people seeing my business, like, what is that, what is that going to look like? But yeah, the finances was a really, really big one, I think think was preparing, preparing that, getting that to look nice and clean and, and like understandable, like what's coming in, what's going out sort of thing.

Yeah, that can be crucial for a lot of buyers because if they're a financial buyer, they're specifically looking at just, you know, top line revenue expenses, profitability, obviously other things like growth rate churn. But you can just see all that from, you know, a simple financial statement so highly recommend pnl.

Same.

Yeah. Okay, so you're, you're now talking to a number of different buyers. Things are going well. How did you land on the person that acquired the business? Was there just a good fit in terms of relationship? Was it the highest price? Was it like, what about this individual made you confident in selecting them as the winning buyer?

Yeah, that's a great question. I think it was just a really good fit in terms of how I saw Solo Drop going in the future and like where I saw it going. And also, yeah, the right offer, of course. But I will say on, on that note, you know, I had a few people that I was talking to that I felt like we're gonna, you know, sign an loi like pretty, pretty quick. And I my, you know, the person that ended up actually buying my business, I felt like I almost unintentionally ignored them for like, you know, maybe even like a week or something like that. So I think that is like, like you, it kind of goes back to what you were saying before, like, just be responsive, you know, make sure that you're actually on top of it. But so it was a bit of a shock to me that the person that I felt like just sent like a kind of a casual message over of just like, hey, this looks super interesting. You know, let's chat about it. I think that I didn't take it as seriously as I should have initially because I was already talking to a few people that I felt like I was. It was really going well. You know, we already talked about a lot of like finances and stuff like that. But when it got down to it and I just got on a call with him, it just felt like the right fit. It just in terms of what he saw, you know, and he had some knowledge of Shopify as well. And I didn't have to really over explain everything. He's very technical, I'm very technical, so he understood a lot. I didn't have to explain what, you know, Shopify is, for example, and you know, stuff like that.

So that's an uphill battle. If you're selling like a SaaS business and you're explaining what SaaS is or shop five, you're saying, yeah, so that can actually be, you know, that's a really good tip for just other founders too is, you know, when you sell to someone, experience with the business that you have, things just go so much smoother in terms of. And I'd love to hear how this went, just like due diligence and like the transition, was that easier because the person was, you know, already familiar with Shopify and knew what metrics to look at.

Yeah, definitely. And it's kind of funny because like, of course it's a Shopify theme that is for the Shopify platform, but it's also the sales site is actually built on Shopify. So to actually verify the funds is pretty easy. If anyone's selling a Shopify store out there, like, you know what I'm talking about. It's just your funds are kind of there. You can't really, you know, you can't really change that. It's just in the Shopify dashboard. So that was nice. But yeah, I think it went really smoothly overall with the buyer just because of that reason alone, like that he had prior knowledge. There wasn't a lot of explaining besides, of course, like how the proprietary like system works for, you know, validating like your funds are kind of there. You can't really, you know, you can't really change that. It's just in the Shopify Dashboard. So that was nice. But yeah, I think it went really smoothly overall with the buyer just because of that reason alone. Like he, he had prior knowledge. There wasn't a lot of explaining besides of course, like how the proprietary, like system works for, you know, validating licenses and all that stuff. But because he was so technical, he understood like really quick.

So that probably made your life a lot easier because yeah, if the person's, you know, not technical, you know, did you do like a transition period or anything like that or did you just basically sell it, it's theirs, given their experience?

No, no. So like I'm actually finishing up the post sales support right now. I'm in the last like week of it and so we're doing that right now. It basically just, there's not much left. I mean, at this point I think he understands everything. But yeah, there, there's a whole period of like just sort of showing how to operate the business and, and what it entails and, you know, how to update users in the database, stuff like that, that and thankfully I don't actually. Again, this is another reason why it's the right buyer because I don't have a ui, for example, for certain things on the back end of the business and these had to be done in a more technical way than you might expect. And it was a non issue for the buyer.

Nice. Yeah, Shopify apps are great. I acquired one myself with some friends and I call it like SaaS with like training wheels because you can just log into the dashboard, you see all the metrics, everything's in there. You don't have to go polling places from like five different areas. So I don't know if you would agree with this, but I think for people that are, you know, interested in buying a company for the first time, Shopify SaaS applications, I think are just great.

Yeah, absolutely. I think it's, I think it's pretty great. Mine was more of like a third party, so it wasn't on the App Store. It was just like its own thing. But it operated the same exact way, you know, the same way that you'd expect a Shopify app to operate it. But yeah, I mean it's, I totally recommend it. I'm obviously like pretty deep into E commerce, so there's, there's a lot of, there's a lot of money to be made there, you know, and in terms of just building, building apps and improving people's stores.

Yeah, I've seen, I've seen some really interesting Shopify SaaS apps, like pretty, pretty Big ones, surprisingly. But I guess for, you know, again, congrats on, you know, the acquisition. I guess for, you know, the final questions is if someone came to you and they had, let's say, a Shopify app and they were looking to sell it, what's. What's gonna be like three pieces of feedback you give that person?

Yeah, for sure. I love this question. So I think the, the. More. Okay, I'll start with the obvious one, which is like something that I learned here, which was like, get, get your, you know, make sure. When you're, when you're about to sell, get your. Make sure your finances are in order. Make sure that looks good. Make sure it's clean. Yeah.

Yes, please.

Yeah, it's understandable. So it's not like this confusing mess of like, well, let's, let's screen share my credit card statements sort of thing. You know, as long as that's good. I think that's like a really big piece to it. I'll say another one. And this is more general. This is. I think both of these pieces of advice I'm about to give are pretty general. And it's that don't, don't intentionally or unintentionally ignore a prospective buyer. I think that's, you know, just be on it. Because the one, the. The person that I sold my business to, like I said, was not really, like, first in mind. He. I think he messaged me while I was like, well into, like feeling like I was about to really sell the business. And it was like a last second swoop, if that makes sense. So like, just make sure you talk to everyone. You know, Just. Just get on a call, like you said. Just get on a call and like, chat with people and see, see how you feel about it. You never know. You. You never know. May, maybe, maybe this particular person. I'm not saying anything about my bar, but maybe this particular person is like really bad at communicating via text. But maybe they're like an amazing person on a. On call or something and, you know, they're really easy to understand or, or maybe it's like your dream buyer and they have a great offer. Well, get. Just getting on a zoom call or something like that versus just messaging. So I think something like that is really important because I feel like it was a little unexpected that, you know, the, this buyer just kind of came in what feels like last second to me, and just. It ended up being a really good deal.

Can I add to that?

Yeah, yeah.

I love that point because, you know, a lot of you Know, business owners, startup founders, they don't realize when you. When you're selling your business, business, like, you're. You're doing sales, you have to talk to people, you have to get on the phone, you have to respond quickly because that shows professionalism that, you know, the more buyers you talk to, the higher your chances of getting acquired. So great job, Corey, for, you know, you know, following up with the person. Even if, like, they don't seem like a great, you know, initial lead, you just never know. And they could be a great source of feedback. They could tell you all the stuff that they don't like, and that's information you can, you know, put together for other buyers. Like, there's just so much that you can learn from even uninterested buyers or a buyer that expresses interest but doesn't actually, you know, end up with an oi.

Yeah, I totally agree. And just to add to that, you know, I'm. Sales does not come naturally to me at all. This is probably the first time I'm, like, really selling something. If you think about it, you're selling a really big asset. I mean, at the end of the day, you know, you feel like because you didn't buy this, likely you're. You don't. Like, you have to remember what you're listing it for is like, essentially the value that you're selling it for. So I feel like you need to think about that. And I don't know if that, you know, was obvious to me when talking. I just felt like I was going in zoom calls and just chatting with some people. And, you know, once I realized I actually had to sell, sell this, I kind of like, you know, something flipped in my brain where I was like, okay, now I have to be a salesperson on this. Like, you're selling something that's like a big asset.

So.

But, yeah, I 100% agree. But, yeah, in terms of, like, the last piece of advice, I would say something very not as general and very specific to my business was like, you know, I think it's good to ask yourself, did you try everything that you wanted to try for you, first of all, are you ready to sell? And if that's, like, if you feel like obviously yes, then I think ask yourself, did you try everything that you wanted to try in terms of creating, like, the highest value at this point in time for your business? And like I said eight months before I listed it, it. I wanted to list it because I had, like, some good TikTok viewership and I had, like, a lifetime product. But I was like, you know, like, what if I just make this into a subscription model and then, you know, crunching some numbers, whatever, it looked great. And then it was like three months after I built that, which took a couple months to build. I would, I would say it was probably double, double the value. I think if I sold it eight months prior, it would have been like half the value that I sold it for. So I think it's important to like consider that, you know, like, is there not stopping anyone from selling their business? But like, if you already want to sell your business, is there something that you can do in just like the next maybe six months that is going to make it more valuable? So I think that's something that I would probably tell someone else because that's exactly what I experienced.

Yeah, no, that's, that's also great advice. And that can include things like reducing expenses, cleaning up the books, going through your, your customers and making sure that, you know, maybe you can get them on yearly contract. There's so many different things you can do, do. But just having that mindset of like, okay, I'm gonna sell it in the distant future. I'm gonna start, you know, positioning the business in the best way possible for buyers now. That's, that's, that's great advice, Corey. I like that. I guess my final question is, what are you doing now?

Yeah, so pretty crazy. I, I decided to pursue being a full time entrepreneur for at least a few months. So I'm working on a project. So. Stealth, stealth project right now. But yeah, just to give a little teaser on that. It's going to change the way that local businesses interact with their customers. And I'm like really, really excited to do it, really excited to build it. It's in the works right now. So yeah, if anyone wants to follow along, check out my socials and I'll be posting about it sometime in the near future, so.

Right on. Well, Corey, I'm rooting for you. If people want to learn more about your story, where can they find you? We'll put it in the show notes.

Yeah, for sure. Yeah. So on Twitter, the Corey lynch and on Instagra, another place I post just Corey lynch. So yeah.

Right on. Well Corey, congrats again on, on the acquisition. Maybe I'll have you again here for a second acquisition.

For sure, man. 100%.

All right, man.

Thanks, Andrew, I appreciate it.