The Gamechangers: Awesome Motive’s Syed Balkhi on Charting a Lucrative WordPress Business Exit — Freemius

In the early days, we didn’t see acquisitions as a growth strategy. In retrospect, it was probably perceived as more of an alignment strategy. We thought of it as filling gaps to meet our users’ needs.

The Rest Is History (in the Making)

Forgoing the Mass Market in Favor of Niches

What we do when we acquire a product is to pick a market and target them exclusively by optimizing the user experience to cater to their needs specifically.

The Nitty-Gritty of Doing Business in the WordPress Acquisitions Space

What Do Investors Look for When Acquiring a WordPress Product?

Acquiring a Business With or Without the Original Team and Founder

We love acquiring a business along with the team and founder. After aligning the business with our own portfolio, our second priority is to align with what the founders are trying to achieve.

On Acquiring Smaller Businesses

Subscriptions Models as a Performance Predictor

Tricks of the Trade and Common First-Time Mistakes

Mind the Terms, Not the Valuation

One of the earliest lessons I learned from my mentor — who was in real estate — was that if you name the price and I name the terms, I will always win.

Generally, I’m not a huge fan of earnouts because those aren’t guaranteed. So, as a founder, as a seller, it is your decision to make.

What Red Flags Should You Be Aware of?

It’s a messy situation for everyone. Make sure that the finances are clean and that taxes have been paid. If you are looking at selling, take care to ensure that all your financial documents are in order.

A Word on the Jitters

I always recommend that people write down why they’re looking to exit. Life is too short to have regrets — you don’t want to regret selling something to someone because there was still more that you could have accomplished with it if you kept it.

Who’s Looking for Opportunities?

How to Approach an Investor

What to Prepare Beforehand

  • Where’s your company registered?
  • What’s your revenue size range?
  • How big is the team?
  • Do you have existing investors?
  • Do you have co-founders?

[The Growth Fund] form gives me a level of insight that I would need to consider before hopping on a call with you and ensuring that the call is productive.

How Much Data Do Investors Really Need?

We want to make the process easy for the founders so they don’t have to hire an accounting firm and spend a bunch of money.

WordPress Acquisition Lingo

P&L

NDA

LOI

The Current Consolidation of the WordPress Market (According to Syed)

Everyone Is Flourishing

Those who have built successful plugins and sold them will likely come back and build something fresh again, and they will have a lot more experience and resources to do so thanks to M&As. Moreover, it incentivizes newcomers to look for opportunities and build products based on those vacancies.

COVID-19’s Influence on the WordPress Consolidation

Should WordPress Entrepreneurs Worry About the Competition?

When WordPress Wins…

The key for us is to believe … is that when WordPress wins, we win.

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