SaaS Interviews with CEOs, Startups, Founders

We got an offer to sell Heyo with Nathan Latka

05 Feb 2016

24 min

4732 words

4 speakers

05 Feb 2016

Audio

Description

Ep 171 Nathan breaks some big news regarding his business Heyo – he got an offer to sell it. Listen as Nathan discusses with his team the process and ramifications of selling their business. YOUR $100: Remember to subscribe to the show on itunes then text the word "nathan" to 33444 to confirm that you've done it to enter to win $100 every Monday on the show. Do this now. Stop reading this and do it! Click here to join the top tribe and instantly learn how Nathan made his first $10k at 19 years old: bit.ly/1SynoAg Top Entrepreneurs join Nathan Latka daily inspired by, Art of Charm, Pat Flynn, John Dumas, Entrepreneur on Fire, Chalene Johnson, Lewis Howes, School of Greatness, HBR Podcast, the StartUp podcast, Mixergy, Andrew Warner, AskGaryVee, and the great hosts of BiggerPockets! 3 Key Points: Transparency has the advantage of keeping everyone on Heyo’s team informed and learning. The downside is that they may feel anxious about what the future holds. A big part of selling a business is considering its future profitability and potential. When selling a business, it’s important to be sensitive to the feelings of the people who are invested in it. (Employees, investors, customers, etc.) Time Stamped Show Notes: 00:00 – Nathan talks about when he first started his business with his mom. 02:02 – Early on building Heyo, Nathan resolved to be transparent about how offers were negotiated so that everyone on the team could learn from it. 04:28 – Nathan’s team got an offer to sell their five year old business Heyo by their competitor. 05:56 – In line with the founding philosophy, Nathan’s decided to be fully transparent about the process to his Heyo team. 07:22 – Chris Rieger, the head of operations at Heyo expresses his thoughts. 08:04 – Heyo has sentimental value to the team and still possesses long-term value in its future opportunities. 09:20 – Nathan’s concern with transparency is losing talented employees due to the potential acquisition. 10:10 – Nathan is also concerned that the business might become too comfortable and miss out on bigger opportunities. 10:30 – A big part of deciding whether to sell Heyo is its future potential. 11:18 – Nathan doesn’t like the offer – he plans to reach out to other potential buyers get LOI’s (letters of intent) to leverage Heyo’s value. 13:37 – Christina, Heyo’s head of branch strategy joins the show. 16:01 – Nathan thinks that Heyo’s brand wouldn’t be shut down if acquired by their competitor, only reused. 18:01 – Nathan and Christina have faith in their team to find a new project if Heyo were acquired. 19:01 – Christina thinks that as long as they properly manage the communication to their customer base, the transition will be smooth for users. 21:48 – There are numerous people tied to the business – Nathan sees his business partners as life-long, not business long. 22:19 – The investors in Heyo is an important factor to consider in the acquisition decision. 22:44 – What do you guys think - should Nathan sell Heyo? Sponsor: Edgar – Nathan uses Edgar instead of other scheduling tools for Twitter because Edgar cycles through content over and over (buffer/others you have to re-input content over and over – time consuming). In the last several months, Edgar has driven Nathan over 3728 clicks that he didn’t have to work or pay for. Listen to The Top if you want to hear from the worlds TOP entrepreneurs on how much they sold last month, how they are selling it, and what they are selling - 7 days a week in 20 minute interviews! Join the Top Tribe at http://NathanLatka.com/TheTop The Top is FOR YOU if you are: A STUDENT who wants to become the CEO of a $10m company in under 24 months (episode #4) STUCK in the CORPORATE grind and looking to create a $10k/mo side business so you can quit (episode #7) An influencer or BLOGGER who wants to make $27k/mo in monthly RECURRING revenue to have the life you want and full CONTROL (episode #1) The Software as a Service (SaaS) entrepreneur who wants to grow to a $100m+ valuation (episode #14). Your host, Nathan Latka is a 25 year old software entrepreneur who has driven over $4.5 million in revenue and built a 25 person team as he dropped out of school, raised $2.5million from a Forbes Billionaire, and attracted over 10,000 paying customers from 160+ different countries. Oprah gets 60 minutes or more to make her guests comfortable to then ask tough questions. Nathan does it all in less than 15 minutes in this daily podcast that's like an audio version of Pat Flynn's monthly income report. Join the Top Tribe athttp://NathanLatka.com/TheTop

Chapters

1. What significant news does Nathan share about Heyo? 2. How does Nathan ensure transparency with his team during the sale process? 3. What concerns does Nathan have about selling Heyo? 4. What are the future implications of selling Heyo? 5. What strategies does Nathan consider to maximize Heyo's sale value? 6. How does Christina view the potential acquisition's impact on customers? 7. What emotional considerations are involved in selling a business? 8. What final thoughts does Nathan share about the decision to sell Heyo?

Featured

Nathan Latka

Christina

Unknown

Chris Rieger

Transcription

Chapter 1: What significant news does Nathan share about Heyo?

0.031 - 3.315 Nathan Latka

Do you remember the day I came into your office and told you that I was dropping out of college?

3.875 - 4.917 Unknown

You didn't come into my office.

Chapter 2: How does Nathan ensure transparency with his team during the sale process?

4.937 - 6.378 Unknown

You called me on the phone. You were chicken.

7.079 - 9.602 Nathan Latka

Well, it's because I was away in Blacksburg and you were in Northern Virginia, I think.

9.682 - 10.843 Unknown

Yeah, you called me on the phone.

10.863 - 14.367 Nathan Latka

Okay. So what were you thinking when I told you that?

16.069 - 22.697 Unknown

I was thinking, okay, well, I've been paying for him to go to school and he's been running his business out of his classes anyway, so...

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Chapter 3: What concerns does Nathan have about selling Heyo?

23.268 - 24.91 Unknown

If he wants to drop out, he can drop out.

Chapter 4: What are the future implications of selling Heyo?

24.95 - 28.635 Nathan Latka

I felt like a snooty little kid because there's so many other people in debt and in loans.

Chapter 5: What strategies does Nathan consider to maximize Heyo's sale value?

29.055 - 37.305 Nathan Latka

And here I was, my mom and dad worked their butts off to cover college, and then I was taking advantage of it, but I was building a business. Did that make you feel bad or weird?

37.766 - 37.946 Unknown

No.

38.707 - 39.348 Nathan Latka

You were okay with it?

39.768 - 44.434 Unknown

Yeah, as long as you were going to class instead of flying to Austin or wherever and speaking.

44.574 - 48.259 Nathan Latka

Yeah. Well, so I didn't graduate, no degree, but launched the business. It did really well.

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Chapter 6: How does Christina view the potential acquisition's impact on customers?

48.279 - 51.522 Nathan Latka

That was what, back in 2000 and what? Stop looking at your phone.

Chapter 7: What emotional considerations are involved in selling a business?

51.542 - 52.343 Nathan Latka

I'm interviewing you.

Chapter 8: What final thoughts does Nathan share about the decision to sell Heyo?

52.383 - 59.994 Unknown

Mother multitasking. No, you're not.

60.014 - 61.195 Nathan Latka

Yes, I am.

61.536 - 64.64 Unknown

Okay. So it was probably in 2011, I guess.

64.66 - 71.108 Nathan Latka

2011. So we've got a great offer on the table. Now, do you think I should sell? Hey, what should I be thinking about?

72.61 - 94.981 Unknown

Well, you should think about why would you sell it? What are the pros and cons of selling it? Um, How does the offer work for you and for your investors? What are the implications for your employees? Because I know you've had people move and make big changes and do those kinds of things to come work for you.

95.121 - 102.194 Unknown

So I think you need to think through all those things and then you need to think about what you're going to do or what you would do if you sold Hayo.

102.475 - 115.855 Nathan Latka

Mm-hmm. Well, I'm glad you brought the employee thing up because one of the things I always wished I had when I was first starting out was someone where, like, I don't like calling people a mentor things, but where you can literally pull back the curtain and watch somebody sell a company as they did it.

116.376 - 131.739 Nathan Latka

So that's why I think we get so many people from Entrepreneurial Club and everyone that wants to be a part of, hey, when kind of what we're building is because I decided very early on in the process to have the whole team see the offers come in. See kind of how I bid up each offer on Hale.

131.759 - 147.971 Nathan Latka

And they all got to learn from the process and people that where it was clear that they had moved away and that they weren't going to be able to go along with the transition. We help them find great other opportunities. I think that's way more valuable than keeping everybody in the dark and then having to fire everybody if they're not going with the deal in the end.