We sold a 3 month old autopilot Micro SaaS for $30K - Micro Acquisitions 101

Topic of the Week

What are Micro Acquisitions?

A micro acquisition occurs when a founder/builder sells a micro product, such as a micro-SaaS, a newsletter, a directory site, or any kind of product on the internet, to a buyer.

Since solopreneurs or lean teams generally build micro-products, these acquisitions typically involve IP & asset transfer rather than a corporate transfer like large-scale M&A transactions.

This means that the product rights and brand are acquired, but not necessarily the employees. In some cases, the builder may join as the developer, or the newsletter owner may join as the growth lead, but that's the extent of it.

Why do people buy these products?

1. Traffic - It isn’t that easy to acquire relevant traffic on the Internet, if your product generates decent enough organic traffic, chances are that someone will find value from it

2. Cashflow - Most of these products generate a steady or growing cashflow, which can be very lucrative for buyers.

3. Tech - Buying may be easier than building.

4. Adjacent product - The product may help the buyer expand an existing product or can be strategic for them.

Who buys these products?

Internet entrepreneurs, indie hackers, and startups are common buyers of these products.

First, the buyer and seller sign an NDA, after which the seller grants access to all the data related to the product via the Dataroom (an Excel file or a group of Excel files containing all the business data, such as traffic, revenue, users, costs, etc.).

If the buyer chooses to move forward, the buyer and the seller agree on a price and sign a document called the Asset Purchase Agreement (APA). The APA is a legally binding document that outlines all the terms of the sale, including inclusions, exclusions, payment terms, support terms, etc.

Due diligence then takes place, during which all the shared data is verified.

Once complete, the asset transfer schedule kicks in, and all the assets (domain, servers, emails, etc.) are transferred while the money is placed into an escrow account.

Once the transfer is complete, the seller receives the funds from the escrow.

How do you find these buyers or sellers?

1. Marketplaces such as Acquire, Microns, Flippa, Tiny Acquisitions, etc.

2. Inbound - You can receive inbound requests if your product is popular enough.

3. Outbound - You can reach out to folks on Twitter who regularly buy products or to holding companies such as Tiny Capital.What is the process around a micro-acquisition?

VisualizeAI was sold to a Canadian startup because of an inbound request, whereas AI Pick Up Lines, HeadlinesAI, and Spark Social were sold via Acquire, Microns, and Tiny Acquisitions, respectively.

Builder of the Week

Pieter Levels

Pieter is one of the biggest reasons why I got introduced to the world of Indie Hacking and Micro-SaaS. The man is nothing short of a legend.

I first discovered Pieter in late 2021, He had a large following on twitter, two successful products - Nomad List and RemoteOk and was famous for his 12 startups in 12 months sprint.

But I really got inspired by Pieter during the 2022 AI Wave. He launched AvatarAI and it hit crazy revenue numbers within months of launch ($100Kish), Ever since he has launched multiple successful products and makes about $3M a year from his products.

Here is Pieter’s Story

Age - 40

Nationality - Dutch

Top Product - PhotoAI

Pieter's journey began in 2012 when he graduated with a Master's degree in Business Administration and Entrepreneurship. Feeling unfulfilled with the conventional career path, he made a bold decision in 2013 to leave the Netherlands and fly to Asia with just his laptop and a backpack. This marked the start of his nomadic lifestyle.

However, upon returning to the Netherlands in 2014, Pieter faced challenges with anxiety and depression. Instead of giving up, he channeled his energy into an ambitious project called "12 Startups in 12 Months." This move not only garnered media attention but also led to the creation of one of his most successful ventures, Nomad List, which has inspired millions to embrace the digital nomad lifestyle.

In 2015, Pieter launched Remote OK, which quickly became the leading platform for remote job listings. As the AI wave gained momentum in 2022, he recognized the potential and created successful AI-powered startups like Interior AI and Avatar AI, later pivoting the latter into Photo AI in 2023.

What I find most impressive about Pieter is that he has built his projects single-handedly using a simple tech stack, all while living as a digital nomad in over 40 countries and 150 cities.

I hope Pieter's story inspires you as much as it has inspired me.

Community Learnings for the Week

• Brett Goldstein (M&A @google) shares things founders should know before getting acquired. Most of these learnings are relevant to indie hackers as well. You can read it here and here

• Matt shares how he sold Journey+ to private equity just 3 months after launching

• Rahul Mathur (Founder @Verak Insurance) shares the acquisition story of Verak with the complete journey and the whys. A must read 

• Michael Aubry shares the update for Basedlabs but the more important part is the journey, the years, and the effort it took. Great things take time❤️

Parting Notes

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