Startup Acquisition Stories with Nico Jeanne, Founder of Galeby

All right. I am here with Nico, who recently had a startup acquired on acquire.com and I'm. I'm really excited for this one because, Nico, you had a extremely viral post about this story. It got over 900,000 views, which absolutely blew me away on a Saturday. So, Nico, welcome. Welcome to the podcast.

Hi, Andrew, and thanks for inviting me. And hi to everyone. Everyone listening.

So we were chatting before this, and Nico, you're in Bali. I just want to add that I'm extremely jealous. But for those listening, do you want to just give a brief introduction of yourself and your background?

Yeah. So I'm Nico. I'm 25 year old, and I learned to code in May from last year, so 2022. Before that I was in e commerce and like marketing and advertising for like five years or something. And yeah, I gu. That's mainly it.

Nice. And then for the company that you sold, maker AI, what did it do and what inspired you to create it?

Yeah, so makelogo AI is an app that generates logo, as the name suggests, using AI. And it started because I was working on other projects, like just other apps, and I wanted to make logo, but I didn't want it like a generic, like, boring vector, you know, you can just find on, like online. So I was using like a different AI to make them. And I don't know, it was like two. One night, I was like, hey, actually maybe I can make a nap from that. So I give myself a little challenge of making a MVP in 48 hours. And from there I made some sales. Then I made a more complete version, like an automated one, because for the mvp, I was just. I had just like a static language.

Wait, wait, sorry to pause you, but you made the MVP in 48 hours?

Yeah, yeah, yeah. But it was like, very scrappy.

That's great, though. That's how you should launch a product. You want to get it out as quickly as possible. And then another thing that just stood out there was you just learned to code less than a year ago. Did you say nine. Nine months?

Yeah, in May. So, yeah, it's last May, so nine months or something. Yeah.

Okay, so let me wrap my head around this. So before we were talking, you, you sold this business for an amount that is essentially a safety net for five years where you live, which is incredible. And you set a goal. You learned how to code in nine months. You built the product, you found customers, and you sold it. That's. That's, that's the general story that we're talking here. So I want to Unpack a lot of this. So what, what made you decide to, you know, set this goal? Was it, were you at a job that you didn't like, did you just want to build something? Like, what inspired you to build this?

So you mean to build maclogo AI specifically? Yes, yeah. So, yeah, no, I just, I was making some tests like with other apps because I wanted like logos for and yeah, at some point I was like, oh, let's just, let's just make an app from it. Like, I can do it. So yeah, I'm just going to make like a quick MVP and see if people would be interested by it. So I just made like a HTML landing page with a type form and that's it, no backend. Basically people were paying and I was manually using the AI model to generate the logo and sending it by email. So that was my mvp and it.

Looks like it did pretty good in terms of, you know, sales and more importantly, profit. So let's move into, you know, how did you acquire your first customers?

So I, I, I just posted on Twitter actually I did like, oh, I'm going to make like a little challenge. Made the MVP in 48 hours. And I didn't like mention what it was exactly because I wanted to, you know, create a bit of like mystery around it.

Some high.

Yeah, yeah, yeah. So it's like, you know, people are curious. I had like, yeah, a bit less than 600 followers back then. So 50, like 550 or something. So it wasn't much, but it was just enough, you know, to get a little traction.

And, and that's, that's kind of all you need, you know, you just need, once you get that first customer, you're onto something.

Yeah, yeah, so that's like, yeah, so I posted a bit about like, oh, I did that, I did that. Almost ready. And then, oh, it's ready. So you can get the MVP here. And yeah, I got like, I think I got 10 or 12 sales from it. And based on that I was, oh, okay, there are some sales. So I know, I know I'm into something like just with a crappy mvp, no automated version. And I was very clear, like, I'm going to send that by email within like 24 hours. So it's like, it's not like an actual app and people were still buying. So okay, if they buy the crappy version, then there will probably people be interested by the, you know, the full version. So then I did like an automated version in another 48 hours and I was doing that non stop I was like skipping the gym, just working, working, working. And then hey, actually I can launch on product. So I just launched on product and. And then it totally blew up. I ended up product of the day.

I think I saw that. Yeah, Product of the day.

Yeah. So I, I didn't expect that, but wow, that's really cool. So I'm definitely into something and I made like, I don't know, 1,000 of sales, more than 1,000 of sales directly from this day because of the. There is always the spike. And yeah, based on that, oh, okay. I'm really into something. So now I'm going to get some feedback, improve. Because at the beginning it wasn't perfect at all. Like honestly, without like human input to control the results, the logo weren't that good. So I have to do lots of like re giving them like another pack of logo or something. And at some point, like if you try a few times, you will get something that works. And based on this feedback, I made a new version that was way, way better, like automated, way more choice for the user, ET etc. And yeah, that was the final version. So the final version took me one month, a bit less than one month to make, but I was able to do it because I had the feedback from the crappy version.

So that is if people are buying your bad product, you're onto something because.

Exactly.

You, you just take in their feedback and I, I love this, this your story, it's inspiring me because I'm just gonna follow the timeline where you set a goal and then you built a product and launched it quickly. It like you didn' months and months and months to perfect it, you launched it quickly to get feedback. That's what every startup needs to improve their product. And then from there you realize that you were onto something. And so instead of doing stuff manually, you automated it and then the way you marketed it was you built in public and you brought people along and really kind of told your story about you brought the audience along and had them rooting for you. That is, that is such a great approach to, you know, launching a product in noisy market. So that, that is awesome. And then you launch on Product Hunt. And I have to assume that, you know, a lot of people had already heard about maker logo AI and when they saw it on Product Hunt, maybe they had their root of you. They wanted to see you succeed. Is that kind of a good summary of kind of up to where we are now?

Yeah, yeah, I guess. Yeah.

All right. And then so you have a successful business, it's doing you Know a substantial amount in revenue and profit and then you go to list it on acquire.com. can you tell me about kind of the thought process in terms of, you know, selling the business instead of potentially keeping it?

Yeah, so I, it was making constant like a consistent revenue. So I wasn't sure. I was like, I mean it's a good source of income, but I know I don't have the skills to improve it further because I'm pretty new to programming. So to do like very advanced stuff with AI, you need knowledge in machine learning, Python and I have a few basics, but nowhere what I need to really make it what it could be. And on the other side. So I was, before starting coding, I had a freelancing activity and I don't have any clients anymore because I stopped everything in September. So I didn't have any income. So I was like, okay, it could allow me to get like, you know, some cash and find someone who could actually make something that I could not myself do. So it was the only, I would say, real option because either I would keep it that way and probably let it die. Because if you don't add features to your app, like if you don't improve it at some point someone will like another competitor will and customer will just always go with a better option.

So again, did you read like a book on how to build a startup? Because you did everything step by step correct. And your reason for selling, in my opinion is one of the best. Like you took the business as far as you felt that you could take it and it was time to pass it on to someone who could potentially take it farther. And you successfully did that. That's absolutely incredible.

Yeah, I, so I read lots of books about business in general, but not especially but like startup. So it was just, I don't know, I just felt it was the right thing. But I also have been like there before. I have like, I've launched lots of projects in the previous year, so it was in E commerce before and it, it's not that it happened already, but I had some projects where I could not purge them further and they just died out. So I knew that if I couldn't upgrade was. It will die out at some point because I had some experience from, from before. So yeah, I just, I don't want that to happen again. Like that would be stupid. It's something valuable. It's like an asset.

Yeah, you built a valuable asset. You got it to a certain point that made it very attractive to another buyer. Let's, let's Move on to that part. So you, you built this app as, you know, quickly. You marketed it really well. It served a need for customers. They were willing to pay for it obviously as a very lean and profitable application. And then you realize that, you know, someone could take this farther than yourself. And so you list on acquire.com now you're at the point where you go live on acquired dot com. Tell me what happened. Like you go live, how many buyers reached out? What was kind of your initial experience after you went live on, on acquire.com.

Yeah, so I had no idea what I was doing, honestly, at first I was just, I just listed it and I, I knew I wanted to sell, but I didn't thought someone would actually buy it. So I was just, I'm just going to give it to go, you know, just to see how it, like what happens. And yeah, I, I was, I had like trouble finding the proper price because the app was only three months old. So I don't have like a year price, you know, like a year of revenue. So I just read the docs because you made lots of content, which is great to, you know, like how to get started, like what are the basics and stuff. So I just read whatever I could find and I decided to list it for 2.5x revenue, which isn't much, but I thought there are lots of things to improve on the app. So I feel that's a fair price because it's not like a, like a proven track record of like one year of stability. It's just three months of stability. So yeah, I felt that 2.5 was a good price. So I listed it. I asked some help with the support, which was really reactive. So that's something really good. And yeah, then it was approved. And I think the next day I started to receive like people signing NDAs, then a few, like a few people interested messages. And then at some point it made it into the newsletter, I think, and I got tons of messages. So I got tons of people asking me like questions and everything. I don't remember the exact name, but I would say in total probably like 30 NDAs and 10 messages or something.

That's, that's a good amount of interest for. Yeah, yeah, that's, that's, that's a lot of NDAs. Okay, so, okay, now you're, you're live in the marketplace. You, you've been in the newsletter. Buyers are interested, they're asking you questions. How did you find the, the right buyer? How did you narrow it down to that one individual that you Ended up selling this business too.

So I started by just talking a bit with everyone and yeah, I just made calls. I think the best way to, to handle that is via course because you can, they can ask questions and everything. So I had a day with only calls from potential buyers. And yeah, I just asked like, they asked me lots of questions and I also asked them like, what are their vision for the app? Because I mean, obviously the financial part is the most important for me, but I wanted also someone who, I don't want it to sell to someone and then he don't do anything with would be like, I don't know, maybe ego thing. But yeah, and so yeah, I checked with a few buyers. I got like offers above the price and yeah, at the end of the day I got with my last buyer and he had like a really good vision for the app. He offered me like the final price and he's like, I don't want to lose like too much time negotiating and stuff like that. So just make a decision quickly if you're interested. So he made me the offer, the final offer. So it was 65,000. And yeah, I was like, damn, that seems unreal like what's happening here because I listed it for at first 49,000, then I increased to 50. And yeah, then he offered me like 65. Damn. So I needed to take a walk. So I took a walk to the beach to just think about everything. And then when I came back I was just, okay, I'm just going to say yes and let's see what happens.

I mean that's, that's truly a life changing outcome for you where you live. And yeah, that's a large congrats, man. Okay, so, but what I, what I love there and what I want to point out to maybe those listening that you did correctly was you got on calls with buyers because when you sell a business, you have to sell the business. And what I mean by that is you need to talk to buyers, you need to answer their questions. And I like how you did it all in one day because, because that helps you control the timeline that buyers have where you're not taking call one week and two weeks and you lose momentum with buyers. So that was, we actually, you know, advise startups to do that. So I'm very surprised that you have the intuition to. I'm not surprised at all. But that is, you know, typically how you would, you know, run a bigger process if it was a larger startup is you have a, what's called a deal schedule. And so you tell Every buyer that I'm taking calls until this date, I'd like offers around this date. And these are kind of the terms I'm looking for. And it puts everybody in this timeline. Sounds like you kind of did something like that, which is how you, how you maximize your exit. So well done.

It wasn't really on purpose. I just sent them my agenda. And while you can only book like calls, like in the seven week, seven days period, but it happened that they all booked on the same day. So I, I was mainly lucky for that.

And then. Okay, so you and the buyer get to terms now. Next step is due diligence. Can you tell me how that went in terms of, you know, buyer reviewing, I assume, the financials, the code, and then maybe briefly go over just how you transitioned over the assets and maybe any bumps that came up or any, any of the hard parts that surprised you or learnings that you had.

Yeah, so for the, like, everything, like due diligence, I used, I went on a call and I show them, like, I explained like all the codes. Basically I just told them this, like, this part, do that, this part of that, etc. So it took like one hour for everything related. Everything related to financials. I don't really have like proper accounts because I don't need to technically, since I'm not a US Resident and you know, for legal reason, I just don't have to. So I just made like a spreadsheet. I just manually write the costs and everything. And yeah, that was just enough. And I show them the stripe account to show it. It wasn't like a fluff, but that's mainly it for the due diligence. So I don't know if normally you're supposed to do more stuff, but yeah, I just show them everything.

Yeah, it really depends on the size of the business. Like, if it's a really large business, there's going to be meeting the team, there's going to be deep dives into technical due diligence. But, you know, fast due diligence is usually great for both parties because it puts you on a timeline where you're still excited about the deal and if you're able to do it in a shorter amount of time, there's no point in stretching out a due diligence process that can be done in a week or two weeks or 30 days or less. So that's great to hear that the buyer moved quickly. Those are the best buyers to work with. Ones that you get along with, they move quickly, they go over really just the Most important items, which is verifying revenue, verifying all the assets that going to be purchasing. So you, you did, you did great there too. Like you're. This is, this is a really, I'm really enjoying this story, Nico. Yeah. Okay, so. And then the, the last part closing. So I assume you used an escrow service or. And all that kind of flowed through acquire.com.

Yeah, yeah, yeah, we use escrow because it was just easy. It's like directly integrated. So yeah, so we just had like a little delay because the buyer needed to do some verification and he didn't get the notification. So it took like a bit of time, but otherwise it went pretty smoothly. So we just verified everything. Then I transferred him and he approved it and then it was done. So the payment was pretty quick to arrive.

Well done. Congrats. Congrats. I'm just inspired by the story because again, you, you started with a goal, you reached that goal, you move quickly, you created something of substantial value and you reached a life changing acquisition, especially in Bali. Man, you could probably stretch that out for 10 years out there.

Yeah, if I eat in small restaurants and stuff. Yeah, definitely.

I'm so happy for you on that front. So I got two more questions for you. So if you were gonna sell another startup again, what are maybe like three tips you would give to, you know, another founder looking to sell their business? You've already given a lot of great tips. What are maybe the top three learnings that you would tell a startup looking to list on acquire.com?

That'S a tough question. I need to think. Yeah, let me think. Yeah, first one, I would say definitely make it like an actual good deal. So in my case, I know that the app didn't have much like, like track record. And even if the revenue was stable, I also knew that there were a lot of things to improve. So I didn't like put projection of 12 months, you know, revenue or anything. I just put, okay, there was three months. I think it's fair to ask just three times its price because it's almost like maybe like 70% profit. So I knew it was like a pretty good deal, let's say. And I think that's how I was able to sell it quick. And because I had other buyers who after I signed the thing, they were like, I can put even like 70,000 or something. So it seems like it was a pretty good deal for, let's say, the value they got. But yeah, that would be the main thing. It's probably very like vague, but make sure It's a good deal. If you want to go fast, make sure it's a good deal, I would say that.

No, that is absolutely golden advice as well. Because the number one reason that startups don't sell on acquired.com is overpricing. And it's similar to a house. So when a house is overpriced, but similar houses all around the neighborhood are, you know, this is a. That analogy are much less, like 50% less. People are going to just drive by that house. They won't even look at it. And so when you price your startup accurately comparative to, you know, what other startups sell on the marketplace, that's how you capture the most interest. And so you can actually lose out on just great buyers that may be interested. But if your expectations are here and the buyer's expectations are here, and it's just too much to close, it's too much work for the buyer. They're just not going to. They're going to assume that there's no deal to be made here. So just pricing it correctly is like the number one thing. And it sounds like you did it very well because you had multiple buyers. I always say if you have one buyer, you tend to have no buyers. So good job on that. Any other tips you would share?

Yeah, so just to elaborate on this one, so I would even say you can probably even underprice a little bit to get more buyers and then negotiate to push it up sort of. And that's what happened for me. So I didn't purposely like under price or anything. I just put whatever I thought was fair. But I got multiple offers and I was clear with them. I said like, oh, I will just accept the best one and this is what I got. So I give them the numbers and they were able to like, you know, like, bid up sort of. But I didn't want it to waste the buyers too much time either because I could have kept going like, hey, this one offered that. Do you want to bid up or something? So I just, okay, this is a good price. I got like, I don't know the percentage more from, compared to what I asked, but I got more than what I asked. Okay, I won't be like, greedy. I'm just going to accept it. And that's good. I have my. Have like cash for a few years, so that's good. So that's also a strategy, I guess. And for another tip, I would say think about what's in it for the buyer. So in my listing, I try to think like, what, what is the, the main benefit for the buyer, you know, like you sell a product basically. So in my case I, I put like, if you want to you know, get started with AI, with a product with a proven track record because you, you can start, start your logo app or anything but then you need to acquire customer. It's always like, you know, annoying. But here you can buy this like package sort of with a product of the day badge already customers, something that's already working and then you can build on top of it. So it's like, yeah, it's like, it's like buying a product permit for you. So you just think about what, what is the main benefit for the buyer? What are the use cases for this app? So maybe they can integrate it with another service. Maybe they can, I don't know, add more around it. I actually made a whole document with like how to improve the app. What are the possibilities? So you can you know, make upsells with like a designer or something. Like any use case you can think of with the app, just write it down so the buyer can imagine and gives him like wow, so much possibilities with this app I can do all that. So yeah, I would say that's a.

Very important thing that, that you're just knocking it out of the park. Like again when you, when you're going to sell a startup, you are selling. So pointing out growth opportunities and outlining what you would do to improve the application, really making it an appealing offer is so important to attract buyer interest and your ability to do that is just incredible. And that, that is exactly what we also recommend. I don't know if my support team told you to do stuff like that, but every from valuation to pointing out growth opportunities to really making it an attractive offer for buyers is critical because buyers are looking at so many different deals and making yours stand out and giving them and pointing them in the right direction of these are the potential growth opportunities because most buyers are buying startups to grow them further. So outlining those potential growth opportunities for them saves them a lot of time because you know them better than they do.

Yeah, yeah, it's, yeah, it's, it's pretty much like everything because I was in advertising before so I needed my you know, ads to stand out in the newsfeed of Facebook. So it's the same process, you know, need to get something like a bit catchy that directly spark attention.

I completely agree. I guess my last question, and I got a feeling you are, but I gotta ask, what are you working on now?

Yeah, so right now I'm working on other app always still related to AI to do customer service faster. So there is always repetitive questions. That's something I noticed with makelogo AI people were always asking the same and I hate doing customer service so I hired someone to manage that for me. But you know, you can always improve things further. So I was okay, maybe I can use AI to handle that more efficiently. And that's what I'm working on. So basically you just receive a message. It's a chrome extension. So you receive a message, you select it and it's going to automatically tell you like how to like the best template sort of to use to reply it. So it's basically customer service but augmented by AI, sort of. So I'm still working on it, but I'm going to launch I think, I think in maybe tonight or tomorrow. I just need to add a few tweaks to my mvp.

But yeah, well this, this podcast will be out not tonight or tomorrow. So I'll be sure to put the link down in the show notes. So there's gonna go to it.

People are if. No, I was just saying if people are interested, the name is galbi, so httpsgalby.com that's a full link.

Well, Nico, it's been a pleasure speaking with you and just hearing your story of just setting a goal after it, building it, building in public, getting people to root for you, listing it on acquire, setting proper valuation, negotiating with buyers, being transparent about the growth opportunities and maximizing your exit. You did all that flawlessly. So just congrats on the acquisition. I'm super happy for you and I think you'll be back hopefully with, you know, something much larger. I got a feeling about this next one.

Thanks. Well, I mean it was possible thanks to you because I. It's. It's way more complicated to sell without acquire. I been there with E commerce in the past like small website and it was. Well yeah. So yeah, other thanks to you for making it possible. And yeah, I hope I will be back with more stuff to say.

My pleasure. All right Nico, if you want to learn more about your story or follow you on social media, where should they go?

Yeah, I have Twitter and I also have my blog where I wrote everything from the moment I started to learn to code to the sale of makelogo AI and I wrote everything in there. So yeah, if you're curious, you can just check that.

All right, well if anyone wants to hear more about Nico and his journey and this incredible story, I'll put those in the show notes for people to check out. But again, Nico, enjoy volley, keep building and keep inspiring us for, man.

Yeah, I will do my best. Thank you.

All right. Cheers, man. Cheers.