Closed a $60k SaaS Acquisition. All the details 👉
After 10 months of sourcing and due diligence on multiple deals...
FINALLY closed a $60k micro-SaaS acquisition via @MicroAcquire
Here's a short post about how it went down...
0️⃣ THE BUSINESS
1️⃣ DEAL METRICS
2️⃣ ACQUISITION PROCESS
3️⃣ FUTURE PLANS
0️⃣ THE BUSINESS
Let me introduce you to Cloakist...
Cloakist = Custom domains and branding for your public pages from popular platforms like:
- Notion (incl. password protection feature)
- Airtable
- Coda
- ClickUp
- Calendly
- Google Docs
- Adobe Spark/Express
- Microsoft Sway
- Trello
& many more
Easily host pages from [insert popular SaaS] on your own domain + add customizations by injecting CSS + JS
1️⃣ DEAL METRICS
- 📈 MRR: ~$2k
- 👩💻 Customers: ~160
- 💸 Purchase Price: $60k
- 🧮 Multiple: 2.5x ARR
2️⃣ ACQUISITION PROCESS
- ☎️ 18 Jan: Intro call
- 🤫 19 Jan: NDA
- 🕊 20 Jan: LOI
- ✅ 21 Jan - 15 Feb: Due Diligence + Contract Negotiation
- 🍾 16 Feb: Share Purchase Agreement signed
- 💰 16 Feb: Payment + Asset Transfer
- 🤝 17 Feb - 4 March: Handover + Post Sale Support
3️⃣ FUTURE PLANS
(short term)
- 🎯 Focus on marketing + minor enhancements
- 🔎 Blog posts & SEO
- ✅ Website refresh
- 🆕 Signups are steady, but conversion is low. Improve
- 📧 Email automation for customer onboarding & lifecycle
- ⭐️ Core product is stable, minor improvements needed
(long term)
- 🦄 This is an interesting product with opportunities for vertical and horizontal growth
- ↕ Vertical ↕
-- Add more supported platforms (long tail) - ↔ Horizontal ↔
-- Improved support for popular platforms (eg. Notion, Airtable, Coda...)
4️⃣ CLOSING THOUGHTS
🌟 The whole process was an awesome experience. It was a real pleasure working with the seller. Thanks @louisbarclay !
I'll be sharing more in-depth details of the deal, process, and product in the weeks to come...
Follow along... as I figure out how to scale the business:)
Links
- Cloakist website
- Sotion: Password protection for Notion pages
- Follow me on Twitter @bruce_v3 for #buildinpublic updates
Trending on Indie Hackers
Thanks so much for sharing this. I also really appreciate the transparency in this post. For me it's really inspiring to see a $2,400 MRR SaaS sell for $60k. Before Micro Acquire anything that was less than $50k MRR seemed worthless. This is really inspiring for Indie Hackers that even a small MRR SaaS can sell for a real multiple.
I also think this was a good deal for you. A typical 5 year bank note would be about $1,000 . Even if you financed it you'd be cashflowing on day 1. Plus you have a business that is validated, and that is sooo much easier than starting from scratch. I think all of us Indie Hackers owe a huge thanks to @MicroAcquire. They have single handed change the game for us small time entrepreneurs.
I'm excited to see what you do with this! And hope you end up growing it to 7 figures!
Hey thanks Shane, that truly means a lot to me.
Rooting for all entrepreneurs and startups to succeed.
If I can ever be helpful please don't hesitate to reach out!
Thanks Andrew! It's awesome what you're doing for the bootstrapping community!
Thanks Shane! Yes, @MicroAcquire is just awesome. They opened up a whole new space for buyers & sellers of smaller businesses.
This business was ideal for me because I'll be working on it solo. You mention all the key aspects that make buying a business like this worthwhile: validated product with an established customer base, easy to finance, and lots of room to scale.
Thanks @brucem, congrats on the acquisition my friend!
Thanks Andrew!
Great post. I still find it so surprising that more indie hackers aren't doing this.
VC's will pump insane amounts of seed money for 0 (pre?) revenue startups, and valuations of 20x+ ARR to follow soon and people assume that's the norm.
Buying and scaling cash flowing SaaS at 2-5X ARR seems like a no-brainer to me, i'd say more so than starting your own indie venture.
Another way to look at this as an investment (60K) which returns 4% A MONTH (2.4K), where S&P historically returns on avg 10% a year.
Those are solid points you’re making Shitij.
I’m using this as a vehicle to exit from full time employment. I didn’t have the luxury of a lot of runway to build something from scratch hoping that it’ll work.
Going the acquisition route allows me to get into a business that’s already found product-market fit, and then scale from there.
I'm the founder and seller of Cloakist. Congrats on this awesome thread Bruce! I gotta say, it was truly awesome working with Bruce to sell the business to him. In every way, a great win-win deal. Maybe we can even go full Michael Scott and call it a win-win-win deal, since Indie Hackers get this knowledge.
In the next couple of weeks I'm planning to post a few more notes about the deal from my point of view, so you can follow me on Twitter if you'd like to see that: https://twitter.com/louisbarclay
Thanks Louis, likewise! Looking forward to your pov.
Congratulations and thanks for sharing!
Looks like a very good deal!
Thanks Kevin! Happy to answer any questions:)
Really interesting post! Tons of information in a concise format. Love it! 👌🏻
How did you first come across Cloakist?
What made you decide that this was the business for you to acquire?
Were you already working in the domain name space?
Thanks Brandon!
I came across Cloakist for the first time on MicroAcquire.
For 10 months prior I was sourcing deals from there, going through due diligence with some of them until I found Cloakist.
I wrote about this whole process if you want to see more detail.
During this time I evaluated many products/businesses. Ultimately, what made me decide on Cloakist were a few things:
Although I had another business (domain name marketplace) before this, Cloakist is not really related to it in that sense. But yes, I guess having a good understanding of how DNS records and SSL Certificates work does help:)
Awesome, sounds like it's been a great ride! Best of luck growing Cloakist. Please keep us posted on how it's going as you take steps to grow your new acquisition!
Thanks Brandon. I'll be sharing progress mostly on Twitter @bruce_v2 and bigger milestones here.
Such a detailed and clean overview. Wow.
Interesting insights, thanks for sharing!
I'd be interested in how post sale support went. I mean acquiring a business of course needs support after closing the deal, however at the point of negotiation it's hard to tell how much support is actually needed. How did you negotiate something that feels comfortable for both of you, @brucem and @lousbarclay?
Good question Alexander. This is usually a key part of taking over a business.
Initially, I wanted a longer handover period of 3 months. But we settled on a shorter period of about 3 weeks.
The handover actually kind of started naturally during due diligence when it was clear that we were going to close the deal.
We had daily 1-hour calls for about 5 weeks covering due diligence, contract negotiation, and handover.
Louis, the seller, was excellent in this regard, and a real pleasure to work with. He documented everything we discussed and was completely transparent about everything (the good and the bad).
I think it's important that there is a rapport between buyer & seller. The transaction is ultimately based on trust. And spending a lot of time together was important for us during this transition.
Great post @brucem! Thanks for sharing!
I'm curious did you have a lawyer to look over these contracts and stuff? Or Andrew @MicroAcquire pretty much provided the standard boilerplates so all you needed to do is to fill in the details like amount, etc.
The LOI is automated on MicroAcquire now, and I believe soon APA will be too.
But for this deal was a bit more complex because we did a Share Purchase (not Asset Purchase) between Dutch and UK-based entities.
So yes, I did have a lawyer look over the contracts.
Thanks for further explaining! Look forward to more exciting news to come!
That's really great!
😎
Congratulations! This has me pumped to finish building out my micro saas product and hopefully follow in your footsteps.
Cool! Good luck with it Ron!
Great post, simply can't believe I never came across Micro Acquire. God damn
It’s really become a thing the past year or so.
Thanks for sharing, you definitely got a great deal.
Looks like there's a lot of potential in the product.
Good luck 🙌🏽
Thanks Itay 🙏
Thank you for posting
Let me know if you have any questions
How do you even begin to find a customer for such a niche product? I mean, I would not know where to start.
Because Cloakist supports many different platforms I think the key is going to be to focus on each of those platforms individually.
i.e. “custom domain for X”
Over time I’m hoping to expand horizontally (supporting more platforms) and vertically (better support for key platforms)
I see. So I guess you just find a bunch of companies that use whatever product you support and then try to contact them. Smart.
Yep. Most of the traffic is organing following this strategy.
@brucem Hi Bruce, thanks for sharing the micro deal. Congrats. Was ARR the only feasible metric to value the business on? Did the seller ignore future revenues? ARR multiple is a very simple way to value, so well done.
Bruce, noted you are going to run this solo. Why not add a few Volunteers to scale the business from my latest, https://skilledup.life? We now have 5,361 Volunteers from 85 countries. They can help you with user acquisition, conversion, customer support, HR, product design and a plethora of roles in a startup. We are our best customer and I'm building the business with their help whilst providing them with real Experience to land their next jobs. We have a lot of professionals now with day jobs.
@MicroAcquire Hi Andrew, good to see a case study.
Thanks Manoj. ARR was not the only metric for valuation. Other key factors that determined the value were:
The business is still small enough for me to run on my own, and I'll solo at least until the end of this year.
The product idea is great ️🔥 Congrats on the acquisition!
I think it would be good to use Trello with Cloakist as a personal project roadmap
Thanks Vadim!
There are quite a few people using Cloakist for their Trello project roadmaps.
With Cloakists you can completely change the look & feel of your Trello board to match the branding of your site.
I made a cool demo here if you want to check it out: https://cloak.ist/trello
Really cool post @brucem. Thanks so much for sharing!
Cool service you built there as well.
Super cool to get insight into the whole process for small businesses.
Very inspiriational
Thanks John! Happy to hear you found it useful:)
Thanks for being so transparent!
Looks like a good deal, congrats! Btw your typography of the post is beautiful!
Thanks:)
Closing a $50k ecommerce acquisition this month; I like this post and the format I'll share as much as I can when the deals done.
Keep us posted Callam & good luck!
Hey Bruce, sounds great! Congrats! To get more customers, you could give cold emailing a try. Low cost and a high degree of control. Just discovered that this is one of the most popular strategies of all the famous SaaS brands, but only a few talk about it publicly.
Nice website
Very educative with life thought through information's.
I will say thumbs up to the creator of this site and founder.
It's a nice place to interact with people of great knowledge.
Incredible post. I actually observe it so amazing that more non mainstream programmers aren't doing this.
VC's will siphon crazy measures of seed cash for 0 (pre?) income new businesses, and valuations of 20x+ ARR to follow soon and individuals accept that is the standard.
Purchasing and scaling cash streaming SaaS at 2-5X ARR appears like an easy decision to me, i'd say more so than beginning your own independent endeavor.
One more method for viewing at this as a venture (60K) which returns 4% A MONTH (2.4K), where S&P generally returns on avg 10% per year.
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