Keeping it Micro - Andrew Gazdecki - Revenue Today - Episode # 001

Sales, marketing, and RevOps. It's sink or swim out there, and yesterday's strategies and tactics won't help you today. This is Revenue Today, and I'm your host, Jared Robin. Join me as we interview revenue leaders in our community to learn what steps we could take right now to help you scale yourself and your company. Revenue Today is sponsored by RevGenius, and we're on a mission to bring inspiration and creativity to all revenue professionals in the world. All right. Today's guest is somebody that empathizes greatly with the bootstrapped entrepreneur's journey, has been featured in New York Times, Forbes, Wall Street Journal, Inc., Entrepreneur Magazine, and prominent industry publications like Mashable, TechCrunch, and VentureBeat. 2-time exited founder, has been named a 30 Under 30 Entrepreneur in Inc., His current company, MicroAcquire, has facilitated more than $500 million in sales on the platform. Today's guest is the CEO of MicroAcquire, Andrew Gazdecki. Welcome.

Thanks, Jared. That was— that's one hell of an intro. I dig it. Excited to be here.

So excited to have you, Andrew. And, you know, we've known each other for a few months now, and it's so great to have you on. So I want to start, we start all shows with this question. You know, it's April 2022 right now. Debunk a myth about generating revenue today.

I would definitely probably go towards, you don't need venture capital to build a company. What I mean by that is, I know it's maybe mind-blowing to say this, but You can build a company with paying customers. Either that or even broader, you know, you don't need to build a billion-dollar company to be successful as an entrepreneur.

Powerful. Why do you think so many people think that you do need it?

It's all you read about. Like, and You go on any sort of like all those publications that you mentioned, you just read over and over and over, you know, $100 million raise, $200 million raise. And, you know, what I think is kind of happening in just the startup ecosystem is, you know, these vanity metrics are being celebrated. And so as a young entrepreneur, you read that and you want to be successful in, you know, let's say building a startup. And so you feel that's the path to success and really your odds, just to break it down statistically. So when you start a company, about half a percent of startups get actual VC funded. And I can just assume a large portion of those are searching for VC funding. And then once you do get venture funded, Only 1% reach a unicorn or billion-dollar valuation. Now, once you hit that valuation, that's still like, you can be valued at a billion dollars, but if you take that to market, you, I would put money you wouldn't even sell for half of that. So I guess put it another way, you know, I think a lot of entrepreneurs, you know, go into startups not really, you Just understanding what they want out of a startup. I'm of the belief that a lot of entrepreneurs are building companies to serve customers and better their personal lives, become financially secure, really make a dent in the world. And you don't have to build this huge, huge, huge massive company To reach those results. And I think, you know, the sadder part is, you know, I got a ton of buddies who run, you know, really large companies and they hate their job. You know, they got board meetings, you know, they're constantly like, they got some number they got to hit for the quarter. They're stressed out all the fucking time. And then over on MicroAcquire, what I see, and this is why I'm, you know, so passionate about this and just like, You know, my previous, one of my previous companies, Business Apps, we bootstrapped, we only raised $100,000. You know, I didn't build the biggest company, but it, like, the exit changed my life. I was very, very fortunate and grateful for that. But my point being is, yeah, like, I think just a lot of entrepreneurs would just be much happier running, you know, profitable, sustainable business, way less stress. And stress is like the number one, like, killer of, like, a person. So, like, when you go, and then I think the fucking crazier part is, sorry, sorry to swear. I swear a lot. It's a bad habit.

It's cool.

You know, building, you know, that big of a company, especially on your first try, um, you know, you can avoid so many mistakes by just, you know, avoiding venture capital, you know, avoiding all the stuff that you read about that You know, all the startups that, you know, you hear about that are just crushing it and build a company that, you know, really makes you happy and like doesn't stress you out and, you know, focuses on a customer that you absolutely love serving. To me, and then also to add one more layer to that, if you can afford it and you've kind of found product-market fit, et cetera, do it with a team that you care about. That's That's winning in my book. I think, you know, a lot of founders give up too early and there's just, that's a, that's, I mean, we could really peel back, but, you know, I think just a lot of entrepreneurs kind of go into startups, they raise money because they think that's how, you know, the game is played and that's kind of the only option. And that's just not the case. Every day at MicroAcquire, I see founders selling their companies and getting acquired for millions of dollars and You'll never read about it in Forbes Inc. or TechCrunch or whatever, but they own the whole business. So if you sell a business for, I mean, like if you sold, you know, a business for $10 million, like would you be upset if you own like the whole business and you get to walk away with that? I'm not gonna have to answer that.

Not at all.

Yeah, I think most people would even need smaller, like even $1 or $2 or $3 million. You know, that's enough to buy a house cash, put some money, I'm not gonna give like investment advice, but like, you know, buy some index funds, you know, don't look at it until you're 70, like you're set. And I think there's just, you know, a lot of founders that that's what they really want, but they feel they have to go down this other path to achieve that. And it's just simply not true.

And there's unicorn companies, Mailchimp comes to mind right away that have bootstrapped that high, right? What do you think? How do you think they got there from the bootstrap mentality? Like for the people listening that want to take it a little further than that but are intrigued with the idea of not raising money, I'm curious to hear your feedback.

Yeah, I mean, I should note, so MicroAcquire is venture-backed. So, you know, understanding like when venture capital makes sense and when it doesn't, I think is also equally as important. But I'll answer your question in a second. But just getting your first win under your belt, just getting financially secure, and then do whatever you want, like swing for the fences, go lay on a beach, whatever. I think like my recommended path I always tell entrepreneurs is, you know, start an agency, 'Cause that's a great way to kind of, you know, find startup ideas. You see this common problem over and over, productize that, turn that into a SaaS, bootstrap it, 'cause then you're building an asset that you can sell. And once you sell it, swing for the fences, do whatever you want, disrupt the market. But Mailchimp is kind of like an outlier. I mean, they've been around for like 20 years, like 20 years of just Kind of growth, those are rare, you know, those are very, very rare. So it's hard to say, you know, I'm going to bootstrap to, you know, billions of dollars, because I think there's maybe like 20 that have done that, if that. I could be totally wrong. I'm just thinking off the top of my head. But I mean, it's possible, I think, is kind of the rules. And I think the better part about bootstrapping too, just to, note is like, if you bootstrap a company and you're generating revenue, you're growing, you know, you can change horses. You can get to a point, and this almost happened to me in my journey at Business Apps where, you know, we were growing rapidly. We met with every, you know, VC firm on Sand Hill Road, et cetera. But I was young and I was, you know, I kind of felt like, You know, an analogy I like to use is when you're bootstrapping a startup, you can sell the business for whatever you want. You can sell it whenever you want. You don't have any approvals. So I was at the blackjack table, like, okay, now I'm terrible with analogies, but just go with me. You know, I was in the money. You know, I was like, I have a multimillion-dollar business on my hands, but if I raise additional capital, You know, those chips go away and then it's like, all right, now you gotta make a lot more chips and then you can have a liquidity event. So, you know, I would say, you know, the longer you can bootstrap, you know, if you do decide to go raise venture capital, you'll have, you know, a better understanding of where to spend. You'll be more confident in terms of, you know, like where you want to take the business. And then it all really comes down to, you know, personal ambition and market opportunity. And just from personal experience with like MicroAcquire, I bootstrapped that company to about like $700,000 in recurring revenue. And then the market opportunity was so huge and just my personal ambition with a couple prior wins and then the opportunity to help You know, millions of entrepreneurs sell their businesses and have a life-changing outcome. You know, that was very appealing and we could attack that problem, you know, more aggressively and faster. But again, yeah, like for a lot of entrepreneurs, I think it just, it doesn't even cross their mind that that's a viable path is to, you know, forego like the typical Silicon Valley route of success of, Get into YC, get into these magazines, you know, raise a bunch of money. Your chances of, you know, creating, you know, a life-changing outcome are just far higher if you don't raise venture capital. And that also applies to MicroAcquire too. Like, I know the odds, like, I know I have a 1% chance of becoming a unicorn, but I don't really care because You know, my goal is to help entrepreneurs succeed and have their companies acquired. But, you know, I think going through that sort of thought process and like really, really thinking about what you want out of your startup, for me, it's disrupting and changing a market. For my first business, it was, I mean, I grew up like broke, you know, I just, I wanted to become financially stable. And so, You know, really, really understanding what you want out of a startup, I think it is crucially important. And for those looking to raise venture capital, I think, you know, another way to kind of think about it is don't do it for the money. Like, don't do it for the money. Do it for the impact. Do it for if you want to disrupt something, you know, in a big market, maybe it's an old market, And, you know, you want to have that impact because, again, the chances of a liquidity event for a startup that has raised venture capital— and I see this all the time at MicroAcquire. And another example I'll give you is, you know, I see businesses all the time that come onto MicroAcquire. They've raised a few million, doing really good, but they've raised like $5, $6, $7 million and they get an offer for, you know, $20 million. And then they have like 2 co-founders. And so when you break all that down, you know, the outcome for them isn't as— it would be much better if, because you have a liquidation preference, they probably raised over the $20 million offer in terms of valuation. And so, you know, they just get crushed down in terms of their outcome, so to speak. So, you know, going back to my first point, yeah. You know, really think hard about what you want out of a startup and then align your decisions ruthlessly around that. Ruthlessly, because some of these decisions that we're talking about are not reversible. And every other decision in your business is reversible.

Wow. Thank you for sharing all that. That was some awesome knowledge. Now, Diving in, what are some KPIs that are important to you today as you run MicroAcquire?

So we have 3 that we track religiously. One is acquisitions closed. We're a startup acquisition marketplace, so we're not doing our job if startups aren't getting acquired. We'd like to see average deal size go up. The average acquisition on MicroAcquirer is around, you know, depending on the month, you know, $600,000, $700,000, $800,000. I think fully averaged about $700,000. And then also just trust, you know, trust within, you know, the brand and, you know, knowing that, you know, startups on MicroAcquirer are vetted, our buyers are vetted, and we have the best possible, you know, buyer and seller experience for, you People are looking to either acquire a business or, you know, get acquired for their business.

How do you measure trust?

That's a good question. You know, it's a tricky one because we run NPS scores, but mainly it's just through, it's kind of like an effect where Acquisitions are very relationship-based. There's a good quote by Warren Buffett, you can't do a good deal with a bad person. So the way we measure trust, I guess, would kind of be towards acquisitions and then just customer sentiment through feedback and that sort of stuff. So vetting buyers, like, are they legit? Do they have funds on hand? You know, are they accessing, you know, startups with the intention of buying them? So there's a number of different factors. I know, I know we have like a checklist, but yeah, that's another onion with like a lot of the different layers. A lot of it's brand, you know, just having a brand that people, you know, word of mouth where people share their success stories on Microquire. I think that's, that's probably my answer is, you know, where, you know, I could say, you know, MicroAcquire is a trusted marketplace, but when we have like all these customers coming out saying like, hey, I got MicroAcquired, it was awesome. Or, you know, I just signed up for MicroAcquire, you know, the deals are just stuff like that. I think those are good indications of trust. And then also like the blatant ones is, um, no scam. So.

Yeah.

You know, when you're, when you're dealing with, you know, acquiring a business, there's so much process involved. And so we try to simplify that and streamline it. So when you do look to acquire a business or sell your business, you know, MicroAcquirer and our team, we have like tooling that helps the process, that makes it easier to give you confidence when you're selling or potentially buying a business.

Yeah, I, it is hard to measure. And I think what you're doing outside of, you know, what you described, like by coming out with like acquisition type agreements and standardizing that and creating, you know, like new, easier documentation might create or add some trust too, right?

Yeah, I mean, my, my, my, my, like, goal with MicroAcquire, and, you know, I think this is something that is so needed, just like for the startup ecosystem and just entrepreneurship in general, is just, you know, trusted marketplace for entrepreneurship through acquisition. Like, not everyone has a great idea. Some people are great at sales, some people are great at marketing. And so, you know, one thing that we think about a lot at MicroAcquirer is how can we help people that, you know, a lot of our buyers are private equity firms, role plays. We even see venture-backed companies acquiring venture-backed companies. We even see bootstrap companies acquiring bootstrap companies. But what we want to do is we want to create the market. We want to standardize the market because a lot of times, you know, 2 people kind of get to terms like, hey, I'll buy your company. And they're like, What do we do? Because maybe it's their first acquisition. So, you know, we want to standardize that step by step. So when you get a letter of intent, which is kind of like the first step of an acquisition process, you're not signing it. And I went through this personally where you sign it and it's just like, it's almost like you're entering a dark tunnel. You have no idea what's coming next. And so we want to bring kind of light to that tunnel for both sides. So You know, this is step 2. You know, we're going to do some due diligence. Step 3, we're going to, you know, work on an asset purchase agreement. Step 4, we're going to work out a plan to transfer the assets, secure financing, and then put it in escrow and close the deal. There's obviously many more steps. I'm oversimplifying it, but I think if we're able to educate, you know, people that are interested in acquisitions but don't necessarily know how, we can exponentially increase the TAM of, you know, the market that we sell to. So instead of just private equity, and it's kind of like that theme of, you know, I always like Shopify as like arm the rebels, you know, where, you know, we want to bring something that was once, you know, just available to, you know, highly sophisticated private equity firms and standardize it to the point where, you know, anyone can buy a business. Because right now acquiring a business kind of feels like, another one of my analogies, but like you're on eBay, but it's on the blockchain. You gotta like buy some crypto coins and you feel like you're getting scammed somewhere. Somehow you feel like you're missing a step. So by building tooling that helps you analyze the health of the company or helps you, you know, quickly meet the right buyer or have more information on the buyer, those are the types of tools that I think can really expand, you know, entrepreneurship through acquisition.

Incredible. And I do think that's big with trust, right? Like bringing transparency To the sale. Like, if I wouldn't— without MicroAcquire, I wouldn't know what to do. I'd call a lawyer.

Yeah.

As I hope most people would do.

Yeah. And we have lawyers too. We have a marketplace inside of MicroAcquire where you can actually speak to and hire attorneys as well as like due diligence or accounting, tax planning, because when you sell your business, you're going to have a nice tax bill. It's going to sting a little bit. So trying to reduce that as much as possible. We also have advisors too. We have M&A advisors available. So if you go into MicroAcquire and you're like, whoa, I have no idea what to do, we have professionals that you can hire at a rate much cheaper than you'd see elsewhere. Because fun fact, most advisors spend, you know, half of their spend on marketing to acquire customers. Or generally through referrals. And so we refer them, you know, startups for them to help get acquired if they need it. So we kind of, we have tooling that helps if you want to go down an automated path, but then also if you need some professional guidance, we provide that too.

So what's been keeping you up at night?

Probably my son, my 2-year-old son. But business-wise, I'm just kidding. My son sleeps like a rock. What keeps me up at night? That's a good question. Honestly, not much. You know, being this is like my 5th startup, like if you count like ones in college and stuff, you know, I've just gotten used to Like, I don't really get stressed out too much. I don't really get too highs on the highs. I don't really get too lows on the lows. You know, I don't really have like a, I gotta win the whole market, like type of sort of thought process. I think that can be stressful. I'm just trying to build the platform that I wish I had. When I was selling 2 different businesses prior. But if I had to give you an answer, I mean, man, I wish there was a button I can click and then our 2-year roadmap is just done. Like, that's what keeps me up at night. Like, I wish there— how do I make a button where just I can accelerate all the tools that we want to build?

So yeah, you know, it's funny because I often say the biggest superpower you could have as a founder in a high-stress job is remaining level. And, and it's great.

It's true because I mean, if, if let's, I'll give you an example. Let's say like you're, you're running a B2B SaaS company and you're constantly in knife fight, you know, sales calls and you have this one competitor that, you know, is just in every single call and you lose a deal to them. And then if the founder broadcasts that to the company, like, You know, there's so much focus on just, you know, like the founder's stressed out for that specific— it could be a number of different things, but that's just one that comes to mind. It permeates through the culture of the business. And so as a founder, you know, your job is really to make your team feel safe and feel that, you know, we're focusing on the right things and we have a clear direction of You know, what we need to accomplish and what success looks like and how we're measuring that. And then also just, you know, laughing a lot. Like, you know, I think one of the most underrated things that a lot of founders don't do is just have fun. Like, you know, it's such a fun journey. And I think having just, I always say 90% of building a startup is mindset. You know, it just, You know, not getting too high because tomorrow might suck and then, you know, you might sleep bad. You know, it just, it's part of the game, you know? And if you learn to love the game and, you know, another analogy I like to use, my team hates my analogies, but I run with them. But, you know, if you're listening to this and you're thinking, you know, okay, I want to start a startup, You know, try to think of something that would feel like a video game to you, where it's just something that it's not work to you, it's fun. Like, and the reason I say that is it's so hard, so hard to compete against a founder where it's fun to them and it's work to you. Because they're gonna, you know, put in like the extra time, they're gonna, you know, make, you know, they're gonna think longer term, like they're gonna think, Like they're not gonna have shortsighted, you know, goals in place. So yeah, and again, I wanna repeat, have fun, have fun with your team, you know, high five, you know, that's what startups are all about.

So, you know, taking this to the people that are like not there with their mindset, right? Like that are stressed and, you know, unfortunately, not level, what advice would you have that could potentially help them?

Be patient. Be patient. I think the worst thing you could do is, you know, not take care of yourself. So, you know, get good sleep. This isn't gonna surprise everybody, but eat healthy, exercise. Like if you're not, you know, You know, taking care of yourself, you know, that's just gonna increase like stress levels and just kind of make things worse. And then number 2, I always say, you know, I talk to a lot of founders where they're like, oh, we're only doing like $3 million in revenue or something like that, or like $5 million. And I'm like, the first question I always ask is like, where were you 2 years ago? They're like, oh, like, you know, you know, $400K or something like that. And then I ask, did you expect to be where you are today, like 2 years ago? And they're like, oh no. And I'm like, see, so be grateful for like the progress you've made. Like, you know, give yourself a pat on the back. Like, you know, and then the second thing to definitely avoid, I guess is the third thing, don't compare your startup to other startups. Like there's always going to be a startup growing faster than you. There's always going to be a startup You know, touting a huge valuation. There's always going to be another startup just absolutely crushing it, getting, you know, but just do you, tune out the noise.

You're reading my mind. Such good advice, man. What excites you the most about the future?

I would say how much startups have been democratized. So, You know, and this again, I don't want to plug Microquart too much, but this is just kind of what I see on a daily basis. But, you know, we see startups being created, you know, multimillion-dollar startups fully owned by people in Europe, South America, Africa, Australia, like every continent. I joke and say, you know, we, We facilitated acquisitions on every continent except Antarctica, so still working on that one. But yeah, I think, you know, it's just such a good time to build, you know, a SaaS startup because there's so much opportunity, or maybe a community or e-commerce company because the opportunities are just massive and then the tools needed. So You know, let's, let's rewind a decade ago, you know, building like a simple application was super fucking hard. Like, and then figuring out how to scale it was super fucking hard because there wasn't as much information being shared. There weren't, you know, Aaron Ross hadn't come out with his book yet on like the SDR to AE model. There's just so much good information today on like how to build startups. There's tools that, you know, no-code platforms that help you get to market faster. You can validate ideas faster. So that really excites me. And I think just that alone gives so much opportunities to entrepreneurs, not just in Silicon Valley or whatever, but to like literally all across the world. And I think, you know, that's really what we need is we need like a level playing field. that gives every entrepreneur a fair chance of success. And so that's what fires me up is, and I'll give you a little story too. So there was a company that we helped sell in India and he sold it for, I believe, like a quarter million bucks. And he was 23, 23 in India, all cash. And so He just wrote me this like heartfelt email just saying he was going to like pay off all of his student debt. And it was a platform that helped people with coding tests at like, you know, big FAANG companies or whatever. But he was going to like buy his mom like a house, stuff like that. Like $250,000 in, you know, another country aside from America can go a long, long ways. And so Again, I think we're going to see more and more like really interesting startups coming from, you know, places other than just, you know, the Bay Area.

I mean, you're speaking to a non-technical founder that has nobody coding and we're scaling just fine in that. So I see it too, man.

Dude, I'm not technical either. I literally, if you're like Andrew, like, I'll give you a million bucks for access to this. Like, I don't know where they are. Like, my, I, back in the day, like at, at Business Apps, um, we'd do some wild shit. We would, um, we would, uh, push code. We didn't have a staging server. This was when I was running all product management. That's a big no-no. Um, but yeah, I've had the service keys taken away by my teams, like, uh, For about a decade.

Right on. So the first half of this podcast, we learned from you. The second half, we're going to learn about you. So who are you, Mr. Gosteki?

That's a broad question. I, you know, I like to think of myself as just kind of a startup junkie. I love entrepreneurship. I love startups. You know, I think I was really fortunate in life where, you know, again, I didn't grow up with too much. So, you know, early in when I was growing up, I just came across this thing called the internet. Have you heard of it? And, you know, I just enjoyed selling stuff on like eBay and then I enjoyed building websites for like school bands and like, I really, you know, my passion and just also my, you know, professional goals aligned and I'm just really grateful that that happened. And I always say like, some people like to play like tennis on the weekend. I like to play startup. I like to, you know, that's just what I love to do. I like to surf. I grew up skateboarding. So those are some other hobbies, but yeah, I just, you know, I love to just build.

That's awesome. And, you know, what do you do outside of work? What are your passions outside of work, outside of playing startup?

Definitely with my family. I have a 2-year-old son, so every moment, and that's something, I have a few non-negotiables, and this is maybe another thing to add is, you know, when you're building a startup, I think, you know, you make a lot of personal sacrifices. I don't, like, I have lunch with my wife every single day, just block that outta my calendar, you cannot get on it. And then when my son comes, when my son wakes up, Um, you know, I take him to daycare, um, pick him up from daycare, and then I read to him every single night. Uh, weekends for the boy, um, used to be for the boys, but now it's for, for a little, for a little Julian. Um, so that's, that's, you know, that's been a big shift in my life. And, um, you know, I'm loving every minute of it.

Is he on a skateboard yet, or how old is he?

He, he's, he's a, yeah, he's an adrenaline junkie. He, he's definitely, he's definitely hopped on my skateboard, but it, I mean, he's 2 and a half, so we kind of gotta like make sure he doesn't get hurt. But I mean, he's already riding a bike. He's already got like a scooter. Um, he loves cars. Um, though he's, he's, he's gonna be a handful when he gets older. I can already tell.

That's awesome. That is, you know, you know, family is everything and that really hits home. So, all right, Andrew, break it down. Where can, where can the listeners connect with you?

Yeah, on LinkedIn, Andrew Gazdecki, Twitter, @AGazdecki, if you can spell that correctly, or just andrew@michaelpoirier.com if you have questions about You know, growing a business, selling a business, buying a business, feel free to shoot me an email.

Thank you, Andrew. Really appreciate you being here.

Yeah, my pleasure, Jared. Thanks for having me on.

Whoa, another great episode of Revenue Today. For show notes, links, and mentions, visit revenue today dot live. For all my friends in the Rev Genius community, thank you for listening. It's been awesome to spend this time with you. Please DM me any feedback and ideas in our Slack channel or on LinkedIn. If you're not in Rev Genius, join us at revgenius.com. It's free and takes only a couple seconds to sign up, and you'll be a part of a community of 27,000 revenue professionals strong. We've got it all. Looking forward to seeing you there. Catch you on the flip side. Boom.