It was scary and fascinating to realize that I don’t actually know the true definitions of the terms I use on a daily basis.
I mean, most of the definitions feel intuitive to me. I learned them through my interactions with objects, information, and other individuals. However, they may not be entirely accurate compared to what is stated in Wikipedia.
Why is this important?
Defining something is the first crucial step in the thought process. It’s where your mental walk begins.
How can I develop a marketing strategy if I lack a clear understanding of what “marketing” and “strategy” truly mean?
Since I started working full-time on creating and selling web businesses, I developed some basic principles to follow.
They remind me how I want to work, optimizing for both joy and output. I reread them at the beginning of each month.
Here they are:
1. Focus only on topics that matter to you.
• This may seem obvious until you realize you are pursuing money or launching a project simply because of new technology.
• It takes months of self-discovery to identify what your areas of interest are. A long-term strategy.
• I am passionate about yoga, investing, and deep thinking. I understand the significance of these elements in my life and actively practice them. Developing projects serve to enhance my comprehension of these topics.
2. Always search for non-obvious ways to do things.
• When solving a problem, creating content, looking for a distribution channel, or figuring out a business model, don’t blindly copy others.
• Instead, speak from your heart and be true to the world.
• I found mental models significantly changed my view of the world. My goal is to familiarize people with these ideas, but not through blog posts, a newsletter, or a book. That is not my style. I am creating a tool mentalwalk.com for this purpose.
3. Launch within a month or never.
• Create a simple product using no-code tools or collaborate with a technical partner.
• Developing the majority of MVPs generally takes 1-2 weeks.
• Allocate an additional 2 weeks to implement a basic marketing campaign.
• Identify 5 channels and create 10 micro-campaigns for each to have a total of 50 opportunities to attract users.
• Have multiple business models ready to experiment with upon launch.
• Maximize automation.
4. Minimize your budget.
• My preferred toolkit consists of Google Sheets + Apps Script, Trello, Gmail, Netlify, Carrd, Mixpanel.
• Not more than $100 per month for all experiments.
5. Devote 80% of your time to customers.
• That includes support, marketing, and sales.
• If you have a technical partner, 80% is a feasible expectation. If not, aim for at least 50%.
6. Monitor on autopilot.
• I find it counterproductive to constantly monitor statistics.
• Instead, I have a recurring email for every project with significant metrics. This helps me keep track of the progress even if I’m not actively working on the project.
I do many experiments from start to finish: identifying problems, making the initial version, launching it, and seeing the results, which may be good or bad.
I sell for two reasons: either I get bored, or the results are not what I hoped for.
1. Things you can sell.
• The only thing that might attract a buyer is the outcome. There are two interesting outcomes: revenue and users. A revenue stream is worth five times more than a user database.
• Think of a business model and test it quickly. Buyers care about how quickly they can restart the project and how easy it is to expand. So, they would rather buy a project with a business model, even if it doesn’t make much money.
• If you have 10 users and they generate $100 per month for three months, you’ll get attention. If you have 500 users and $0 in revenue expect offers to be low.
• Projects without income and users are not valuable to the market at all. They are often listed for a conditional $1,000 to at least cover the time spent. But buyers don’t care how much time and effort you invested.
• And because of the «crappy code of early stages», they’ll only buy problems.
• If you have a project without income or users, close it and work on something else
2. What potential buyers expect to see.
• If you have results, you will receive a list of questions. I’ll show you the ones that overlap. Don’t skimp on words, answer honestly, suggest ideas, and provide proof.
• Expenses should be kept low. I aim for a budget of $100/m.
• You should have a business model. Most points are given to «subscription». But if users buy repeatedly with a known frequency, it’s not much worse.
• There should be some revenue. Basic indicators include monthly and annual growth in the last three months and churn.
• For a web project, the profit margin should not be less than 50%. Some agencies have such a margin, so try to optimize it.
• The quantity and quality of users should be measured by their «return» for a given period.
• Think about how easy it is to maintain the project at the current level — technically and operationally. Automate and optimize everything possible.
• What have you done for marketing and sales already? What did and didn’t have results, and why?
• The potential buyer will ask for guest access to important indicators such as income, analytics, and mailing statistics. If that’s not possible, they will ask for a call and a screen presentation.
• What functionality should be added in the future? What channels should be tried? All the crazy ideas you were thinking of at the beginning should be considered.
3. How much money can you get?
• Based on my experience, expect to get 2-6 times your annual recurring revenue. The amount depends on factors such as your business model, profit margin, and maintenance costs.
4. Where to sell In 2023?
• I categorize platforms into two types. I listed projects on all of them and got at least one response from each.
• Projects worth $0 to $10,000 can be listed on Acquire, SideProjectors, IndieMaker, and Microns.
• Projects worth more than $10,000 list on Acquire only.
• I’m aware of Flippa, but I don’t prefer using it because there are many low-quality items listed and the selling methods are outdated.
• You will start receiving offers. They may offer you half of the price right away, ask for a call, or request screenshots or written answers.
• You will communicate with potential buyers for a week to a month. Don’t reject an offer immediately if it is less than what you expected. Listen to their arguments and try to negotiate. I suggest creating a Google document with all the necessary information for the new owner.
• The buyer usually offers an agreement to buy and might include terms that prevent you from competing. Check what’s being offered and ask to remove anything that’s uncomfortable.
• Once I was asked for a 3y non-compete. Since the sale price was $10,000, I reduced it to 1y.
• If the buyer hasn’t mentioned it, I suggest including 1-3 months of support from me in the contract. This could include answering questions, a set amount of calls, or new ideas I come up with.
• Use an escrow service. This is a third party that freezes the buyer’s money and transfers it to you when the deal is done, but since I can’t use it, I receive money via a SWIFT transfer.
• I split the transfer into two parts for the buyer’s convenience. After the first payment, I transfer the technical part; after the second, the domain. Or vice versa.
Conclusions.
• Consider selling only if your business has revenue or users.
• When presenting your business, be sure to tell your story and show the numbers, as well as suggest ideas.
• Look into marketplaces like Acquire, SideProjectors, IndieMaker, and Microns.
• Be patient and responsive, answering any questions and following up as needed.
• Keep in mind, typically you can expect to receive a multiple of 2-6 times your annual recurring revenue.
