Startups · E-Commerce

Is there a marketplace to sell a start-up?

Devin Dufenhorst Regional Account Manager at Abbott Diabetes Care

February 19th, 2016

I have a start-up that is 3 years old and I have taken it as far as I can and would like to find a either a person or company that would like to acquire the IP, website, and mobile apps.  How do I do this?

Jacob Mullins CEO @Exitround

February 19th, 2016

Hi everyone, I'm Jacob Mullins (@jacob), CEO of Exitround.com a software powered network for M&A, based in San Francisco, backed by Shasta Ventures, Sherpa VC, TechStars, 500 Startups and other great Silicon Valley venture firms.

In essence, we use marketplace dynamics and algorithmic recommendation software to more efficiently introduce interested Buyers and Sellers of companies who may not know each other.Sounds like a few of you have heard of us, let me explain who we are/what we do as well as correct a couple perceptions from some comments above.

We are primarily a self-serve platform where you build an "anonymous profile" of your company and our recommendation technology provides you with suggested corporate acquirers who are interested in your space. This is a free service. Hundreds of Buyers login to the platform on a weekly basis and look through the anonymous profiles, where they can request more information from an "anonymously" listed company. The owner of the company gets to approve or decline the request from the prospective Buyer. Again, this is an entirely free service, to get a list of potential Buyers in your space as well as receive inbound leads.

There is an optional premium level service where you can pay a monthly fee in order to "outbound" pitch Buyers who are in our network. These fees are $99 and $499 per month, depending on the number of Buyers you want to reach out to.

The primary business model is a success fee, the greater of: 1% of the transaction, or $20,000 per person (if an acqui-hire), the fee is paid by the Buyer.

By the numbers:

Over the past three years Exitround has completed over 70 successful M&A deals. Deal sizes have ranged from $100,000 to $85,000,000, with the majority falling below $15,000,000.

There are over 4,000 companies selling on the platform today which range from the smallest being two people with a product and no revenue, to the largest being an enterprise software company doing $50,000,000 in revenue with a positive 12% EBITDA.

There are over 30,000 active Buyers in the Exitround network, a large portion of who are "non-traditional" Buyers outside of the typical technology space, such as Red Bull, Live Nation, Fender, Westfield, to name a very small sample. (Here's an article relating to such: businessinsider.com/the-year-of-the-tiny-tech-acquisition-2015-1) These Buyers both proactively search, and are prompted to come in a view companies when there are Sellers that fit their specific areas of interest.

For Sellers on the platform, 2/3 of sellers receive at least one request from a potential buyer - note 1/3 of companies receive no interest from Buyers. Of the companies that do receive at least one request, on average they receive 2.7 (or nearly 3) requests from an interested Buyer.

Here is a Quora thread of an Exitround user who went through a transaction successfully:https://www.quora.com/How-is-the-experience-of-getting-acqui-hired-through-Exitround

For more general information about M&A check out our blog exitround.com.

For data on Tech M&A in the world below $100,000,000 transaction size (where 88% of transactions happen), download our report here: exitround.com/data

To check out Exitround for yourself and build a free anonymous profile, go here: exitround.com/seller.

For a handful of companies who are revenue generating and positively profitable over $25,000 MRR with a stable base of customers, we have specific interest today from some "nano-PE" firms interested in doing roll-ups, so contact us.

Feel free to email me with any questions [removed to protect privacy].

Thanks!

Jessica Alter Entrepreneur & Advisor

February 19th, 2016

Exitround.com does this 

Paul Travis Multifaceted Online Executor: Product Marketing to Program Mgmt. to Business Development

February 19th, 2016

www.flippa.com

Andrew Lockley

February 19th, 2016

What does it do? For offline UK biz try Daltons

Matt Harrigan President & CEO at PacketSled

February 19th, 2016

I would identify the top 3 companies that you feel you have technology synergy with, and reach out to either them or their investors to talk about licensing or an outright purchase. If you don't have people or customers behind your tech, expect a low purchase price. You likely don't need an online service to help you with this. 

Greg Dean CTO @ Exitround

February 19th, 2016

Definitely try Exitround. It's free to sign up and receive inbound interest from our marketplace of buyers. We charge a small fee to enable outbound M&A (mainly to control spam). We make almost all of our money on a success fee basis, so there is little downside to trying it out.


Chris Seline

February 19th, 2016

@Jacob: 30,000 active buyers but only 70 transactions in 3 years? I wish you guys luck because I think the world needs an Exitround, but these numbers do not seem promising to me. I balked at the $500 per contact fee when I used the site, has the fee structure has changed? The idea of paying $500 to send an email when you had no idea if it would be read or not was not appealing.

Chris Seline

February 19th, 2016

Check out Flippa, Axial and Exitround to see if they are a good fit. Exitround doesn't really "sell" your company, it just gives you some exposure to connections so you can try to sell it yourself. And then you have to pay Exitround to reach out to them. In my opinion it sucks. Flippa is good if you have a simple website with cashflow, but not good for a tech acquisition. I have not really used Axial.

If the deal is big enough shop for an M&A advisor. You will need to pony up a monthly cash retainer for a good one, or go with someone hungry that will only take a percentage.

But none of those worked for me. Really the best approach is to find partners that are interested in your business and then convince them to buy you because it's in their best interest.

Josiah Johnson Director of Software Engineering at PayLock IPT

February 19th, 2016

There's also FEInternational.com which handles website and SaaS.

Mats Samuelsson IoT Executive > GM, VP Product Management, Business Dev, Marketing | IoT Business Definition, Creation & Growth

February 19th, 2016

Is there a marketplace to sell a start-up?I am in a similar situation with a business based on extensive granted patents (that we own) for a navigational user interface for mobile devices and applications. The user experience and technology is revolutionary enough that the big players should be interested but I have had a tough time to reach the right person. Would be interested in suggestions.