Startups worth acquiring - Acquire.com Academy

This video I'm going to be going over probably the three main signs that really makes me understand if I want to acquire a startup. So I'm going to go ahead and share my screen and this one will be pretty short. But three signs of SaaS business is worth acquiring. So Churn, code and customers. How happy are your customers? How clean is the code? Is it full of bugs? And so Churn, pretty straightforward. This is basically a measuring stick of how happy are your customers? Are they resubscribing to your service every single month? Are they canceling at a very high rate? Because with SaaS, which made. What makes SaaS so special is that you can scale a business very, very quickly with having low Churn, ideally net negative Churn, where customers are coming on, buying more of your product and you're growing without even adding new customers. That's kind of the holy grail of a SaaS model. But I'm looking at Churn. That's usually the first thing. How happy are your customers? Because there's also things I can do to fix Churn. Maybe support is lacking, which is a potential opportunity for you to point out to a buyer because you don't have the resources or any interest in really doubling down on customer support. But Churn is definitely top of the list. So if you want to read all this, just pause the video. I don't want to read all of it code, who wrote it, who owns it, and is it any good? So when you're acquiring a SaaS company, this is software where it could be in a language you're not familiar with. You might not be technical. So what I recommend for this is hire someone. Hire someone for technical due diligence or hire an agency that can go through the code and really just understand it. So when you want to go and add new features or fix potential bugs, you're not just left alone without the previous owner willing to help you out with those. So that is absolutely massive and can really be the difference between a successful acquisition for a buyer and a very unsuccessful acquisition for a buyer. So understanding the code base and part of due diligence is going to be going over this. So basically understanding, you know, really again, are there any bugs? Are there any common complaints from customers? Whatever it may be, those are things that you want to point out in a very honest and transparent manner to buyers. Maybe, you know, you just built this and you know, customers love it. But it has some issues. Issues. When I hear issues for from sellers, I think of opportunities. So that could be anything from you know, marketing conversion rates to, I hear bugs within a, you know, piece of software that I could fix those and then potentially, you know, re engage those customers and bring them back into the business if they've already canceled. So just high level over you overview stuff here and then customers. So when you think about all the services that you use, from restaurants to hotels to software, you typically type in company name plus reviews. So the first thing that I'm doing when I'm looking to do due diligence on a business is I'm researching customers. I don't care what the founder says. Like, I'd love to hear it, but I really want to know what. Just what are customers saying? Like, what do they say about the product? Are they happy? Are they thrilled with the support? Like, there's so much you can learn from just talking to customers. They have the most truthful answers. Not saying that as a founder you don't want to be extremely truthful, but customers really are your harshest critic. And Bill Gates has a great quote where your harshest critics are the best form of feedback. And I truly believe that. So I'm looking for bad feedback too. I'm looking for ways to improve this business. How can I accelerate growth or how can I fix some outstanding issues and really, you know, grow this business after I acquire it? So long story short, flipping through this and all these presentations are available. I'm just cranking these out right now. So three signs of SaaS businesses with acquiring Churn code customers. So I hope that was helpful. And if you have any questions about how to reduce Churn, how to improve the reviews that your customers leave, or how to go through proper due diligence on code reviews with buyers before you actually go into due diligence, feel free to reach out or definitely post that in like the microacquired Facebook group and you'll get a ton of really, really, really good answers. Cheers.