It's great to read the details about what it takes to buy a small business. Thanks for posting this and being so open about what went into the negotiation. I always thought (if I were to one day run into money) buying an already-running business would be a better, less risky path towards entrepreneurship than starting with a blank text editor!<p>A few questions:<p>Is it common to have to fork over all cash for these sized deals? Is it possible/acceptable to finance? What alternatives to seller financing have you seen? I don't imagine it's possible to just waltz into your local bank and say hi guys I need $100K to buy a website!<p>I'd be interested in learning more about finding these deals. You found this one through FE. Are there other common places to find tech listings? Do you ever approach companies that you like but aren't actively looking to sell? I'd love to see a play by play of how one of those conversations go.
Wow how interesting to read this here.<p>I saw this company on FE and requested more information.<p>In the end, I decided against making an offer because developers are notoriously hard to develop for.<p>That said, the business itself looked great, wish you the best of luck and good on you for taking a shot.
It's not obvious to me why price was a function of earnings in a situation like this, the goal of the purchase seemed to be to save resources of developing the tracker inhouse and save time building up a customer-base, earning seems mostly irrelevant in this case.<p>If the codetree was looking to raise funding, it seems like a reasonable metric for valuation.
Wow, if you want to learn how <i>not</i> to negotiate a deal, this is the story to read!<p>This guy had you right where he wanted the entire time and he knew it. He didn't have to lift a finger or budge an inch. You clearly show your hand(s) way too much (which is clearly in your nature given this blog post, and that's not always a bad thing... although in this case it was).<p>If it was a really large deal, you'd need to be willing to walk and show it. Instead of reading a relatively overrated book that did you absolutely nothing, I'd recommend having someone be the bulldog/enforcer and have no qualms about it.<p>But ultimately, I have a feeling you're going to be so successful in something eventually (if not this!) that this money is meaningless in the grand scheme of things, so it's all cool and maybe you knew that.<p>But man, that was painful to read. Good stuff otherwise and great luck guys!
About risks, the article notes:<p>> Github would improve its Issues product and render Codetree irrelevant<p>That seems like a very large risk, especially given GitHub's progress to date. How will it be addressed?
Very good insights on buying a side project. I too have some side projects. But I never want to go fulltime into it because it's using APIs of some well known services. I always say " Never play soccer in someone else's ground ". You never know when they will throw you out of the ground. If you are basing the business out of github's resources you are at high risk.
Thank you for being so open and sharing the actual spreadsheets. It makes things a lot clearer for us dreaming for an acquisition someday :) - even though I worked for a company that went through an acquisition as an employee and even gave a talk on the subject, this is a new perspective for me :)
very interesting read. We looked at github issues mgt tools a while ago and settled on huboard. We didn't find codetree during our search for tools... so it's definitely a challenge to reach developers. Fine posts like this can do the trick ;-)<p>Codetree looks great! Good luck!