The Bootstrapped Founder

Arvid Kahl 00:00
Hello everyone and welcome to the Bootstrapped Founder Podcast. Today, I'm talking to Andrew Gazdecki, a pillar of the founder community and himself founder of the Acquisition platform, formerly known as MicroAcquire. But we'll learn more about that on the show. Besides organizing millions of dollars worth of acquisitions every month, Andrew is a true teacher. His content on building software businesses is spectacularly useful.
And fortunately, he will share a lot of it with us today. Here's Andrew Gazdecki. There's one thing you do with your brand that just is so incredibly attractive to me, and probably a lot of people in the community. And as the way you build in public, that's just the most enjoyable thing for something that has grown into a big platform. So people don't usually expect the founder of such a big thing to be this hilariously relatable. How do you grasp this sentiment of the community so well? Where does it come from?
Andrew Gazdecki 00:54
I don't know. I've always been just a person that likes to laugh, like, things I would do. And I would drive to work. Instead of listening to music, I'd actually listen to stand up comedy. I've always felt laughter is just such an important element of life. And just, I like to laugh a lot. So whenever you're laughing at something that I post, trust me, I'm laughing probably like twice as hard. Like, so I guess like to answer your question, I don't know. I think I like to do funny things and just make things fun. And if people think it's funny too, great.
Arvid Kahl 01:31
It certainly makes your online personality super relatable, you know, like that there are some people who are in the acquisition space that are kind of untouchable because they are so serious about what they do. And you're kind of the opposite of that. And I'm very thankful for this. Because that industry, in particular, needed some deserialization of that sort. You know, it needed some, be more relatable, particularly as MicroAcquire is interfacing with all these little solopreneurs, all these people who just run their own business who are not gigantic enterprise businesses, right? Well, just people.
So having somebody to help them, like what do you do with the business with your platform, that is also a real person. I think that is just a great way to relate to the community that you're actually serving. And I kind of wanna talk about MicroAcquire, obviously, because that's the big thing that you're working on today.
And one thing, that one question that I had when I first saw you were building this thing was - how and why on earth would anybody try to build a two sided marketplace? Like that's just the most complicated thing to ever build for anybody, right? Like if you build this as, they always tell you don't build a two sided marketplace. You have this, like bootstrapping problem for either side, like how did that choice happen? And is it fun? Is it enjoyable?
Andrew Gazdecki 02:47
Yeah. You know, one thing I've always done in my career is I've never started the same business twice. So I started with a job board, and then I bootstrapped a SaaS business. And then I created a crypto protocol company. And then I jumped into a marketplace. And it's actually an n-sided marketplace where there's multiple different types. So it's not just a two sided marketplace, it's actually like a four sided marketplace. Because we have third party financing partners. We have M&A advisors that we can refer to you, if legal partners. So there's a lot of moving parts inside the business just outside of buyers and sellers. So it gets even more complex and you just subscribe, and it's hard.
But I guess the point I'm trying to make is, as a startup, nerd, geek founder, whatever, I you know, you'd want to describe me as, I like learning new business models. I like diving in on really hard stuff. That's when I kind of, you know, get the most excited. If it's super, super, super easy, I get bored of it. I think quickly and I like the challenge of just the unknown and just kind of, I don't know like you just look at something, you just say can I build something like that? And then I get the most enjoyment of just, you know, actually okay, let's figure out how all the other marketplaces did it. Let's study this. Let's learn this.
Arvid Kahl 04:19
Oh, did you do that?
Andrew Gazdecki
Oh, yeah.
Arvid Kahl
Was that something you actually did?
Andrew Gazdecki 04:23
Yeah, so a small little tidbit, unknown secret, or not, not a well known secret about MicroAcquire. Before MicroAcquire actually built another marketplace called podcastrental.com. It was just a simple, I used a shared drive to build the marketplace and I just saw a tweet that was like, “I wish there was something where you could rent podcast studios and just have you sit down podcast.” And I just put it together and optimized it for like SEO and then I read and shared tons of book, go to marketplace and then I read all these other articles on marketplaces, like really understood marketplaces models. And then I ended up selling it on MicroAcquire, which is kind of funny. It's like full circle.
Arvid Kahl
Pretty meta.
Andrew Gazdecki
Yeah
Arvid Kahl 05:10
That's to me, like, that's one thing I failed at in my founder career, like I was trying to bootstrap a two sided marketplace, wasn't even n-sided. And it wasn't that complicated. But it was a, like an attempt to build a local food distribution marketplace where people from the city could buy, like locally grown vegetables and stuff from outside the city in Berlin, back in Germany. That's what we wanted to build, a couple friends and I. And we had immense problems like getting either side of the marketplace bootstrap, like just getting it set up, though, so that people would actually flock to the platform. Because whenever, you know, whenever a farmer would come to us, they wouldn't see any customers.
And whenever a customer would come to us, they wouldn't see any farmers. That was a big problem. And I think one that any marketplace, however many sides they might have, struggles with in the beginning. Even just conceptually, understanding that it can be done, probably is already hard. So what research led you to then trust that you could set it up? Like what kind of inside allows you to just go at it? And what did you do? Like, what were the steps that you took to actually get this going?
Andrew Gazdecki 06:18
Yeah, good question. So to start, I didn't think it was gonna work. I actually keep a journal, where every month, it's not like, where journal like, Dear Diary. It's more just, you know, what I'm working on, what's going well, where I think I'll be in 30 days. And it's a good, just process, I think for entrepreneurs, because what I love about it is when you look at what's not going well, and you read it again in 30 days, I guarantee you 99% of time, you'll read them and be like, “Oh, those are already gone solved. Now, I have new problems to write down.”
So it kind of gives you this perspective that, you know, startups are hard, and you're always dealing with something. And it tends to work itself out if you know, focus on solving the problem. But you know, I researched you know, all over the place in terms of what worked and, you know, the biggest piece of advice for marketplace is, focusing on the side. That's the most important or the hardest to really attract. And I made the decision after looking at, you know, other competitors in the space.
And I felt everyone was kind of favoring the buyers. And so to make it work, I felt, you know, it needed to be, I felt really just in the marketplace, in general. There's this big void where there was no marketplace. I really felt like it was favoring the founders, the owners of the business. It wasn't a place where you can, you know, get a cheap deal on a business or, you know, you find these businesses and you can flip on or something like that. Because no one wants your business flipped, you know, because that means you sold it for too low, and then someone else bought it and made a profit.
And so I thought that was just, I don’t know, I was a startup founder. I just thought like, I'd scratch my own itch, if you will. And so that's how I built a lot of the, I guess the unique parts of MicroAcquire, like the privacy aspect. No fees, I thought, was interesting. I didn't wanna pay any fees. So that's kind of the best answer I have is just, I scratch my own itch. And just after, you know, going through just acquisitions myself, just understanding like the hard parts. And the hardest part being finding the right buyer, and then doing due diligence on the buyer and kind of communicate with the buyers. So creating a lot of educational material around that.
And then I guess people liked it, so to my surprise. So my second journal entry after launch was, you know, hey, it worked a little bit. But I really do have a journal entry. It says something like, I don't know if this is gonna work. But at least a website looks really good, because I tried making my design really nice. Because I mean, there was a thought process behind that. I just thought, you know, trust had to be at the core of MicroAcquire for someone to really list their company and share their financial details and just as information that buyers need.
And so I felt like we kind of had like out startup, a startup, if that makes sense. Like we're even a startup founder goes to the website and go, “Wow, that's a good design,” or big UI UX. That's another just random tangent I can throw in. I think, just user experience and design is such a competitive advantage if you can get it right just because things that like trust and like feel good and look good. I tend to love those products or gravitate towards those products.
Arvid Kahl 09:51
Yeah, absolutely. That makes perfect sense. Also, I would like to bring this back to my description of you as a relatable person on Twitter. I think that's also UX for your business in a way, right? The experience that people have with you on Twitter as a person, as a founder of the platform, as a person that funnels them into this product. The fact that you're relatable, and that you're trustworthy, because first of all, if you have like what, 200,000 followers or whatnot at this point. Like you are a reputable person in the community. People notice that, and that little trust kind of gets projected onto your business as well. I think UX and UI extends beyond the actual product. It's really like the whole business and how it interfaces with people.
Andrew Gazdecki 10:33
Yeah, I think over time, you know, you wanna start thinking about, you know, experience from end to end. So what you're describing is just like the whole customer experience, like how do they hear about us? How do they feel about the product? What is their interaction with, you know, the support team? Or does the product run slow or fast, like, there's so many aspects in this whole experience, end to end. And I think you're touching on something that, I think, is kind of a shift we've seen in the last like three years. Like a decade ago, to get the word out about your company, you had to go through, just basically, PR was the main route. That was, you know, people weren't posting on LinkedIn as much. People weren't as active on Twitter, that wasn't really a thing.
And now more than anything, I think people are becoming less reliant on news and more. They're looking for, you know, I guess, like an emotional connection or a personal, like you're saying, a relatable figure tied to a business that they trust. And that they can look towards for support or questions, or I don't know, laughs sometimes. So that's also I think, something that is changing just in business in general. And I say this often where, you know, every startup should have a chief storyteller officer or chief, just basically brand ambassador, someone to talk about the business. That's, like you said, relatable human, not just, you know, a brand face.
And there's, if you look at any sort of brand, I think you'll notice it where, you know, the founder, or the CEO of the company. If they make an announcement comparative towards if the company makes the announcement, whatever it may be, generally, the person will get more interaction because you're interacting with the person and not just kind of a bring in, if you will. You don't know who's behind that brand. So that was another like thought I had. I don't know if that tidbit is helpful.
Arvid Kahl 12:39
Oh, absolutely. I think like the fact that brands that are faceless are almost completely untrustworthy. Wherever you look, like people just don't trust them. They have understood that this point, after a couple of decades of being kind of just like shushed by those companies, like in every customer service interaction that you may have with a faceless brand, there's another person you don't know. They don't wanna know you. You don't wanna know them. They kind of don't even wanna solve your problem for you. They just wanna get that conversation over. And you've been kind of suppressed by all these businesses.
And now that you see companies actually led by real people, not just led, also just being inhabited by real people. You see lots of in our space, the bootstrapped space, or the indie funded space. There are a lot of companies, where not just the founder is speaking for the company. But every engineer in the company is active on Twitter, or writing just blog posts or just sharing information from within the company, and from within the industry of the company that the company is in. And that just makes it so much more relatable to see that business.
And when I, my example for this would be, I think Fathom analytics, right? By Paul Jarvis and Jack Ellis, like those two people are so present on social media that I don't think of Fathom as a business. I think of the thing that these two guys do, and the other developer that's in the team, right? That's kind of how I perceive that business. Which is, it's not even the corporate kind of faceless thing that most businesses are technically, if you look at, like the founding documents and stuff, but it's an extension of people. I think you're doing this really well as well.
Andrew Gazdecki 14:17
Yeah, and I guess, you know, a better articulation of what I was trying to get at is, I think we've seen a shift away from you know, business to be like b2b business to business to more human to human or people. They wanna interact with the founder. They wanna interact with employees. They wanna hear from actual people, and not just, you know, like a floating logo or something like that.
Arvid Kahl 14:39
I recently had a conversation with somebody who talked to me about like, how we are actually kind of shrinking the sizes of the kind of communities that we're in. Like the whole social media space used to be gigantic, and everybody could talk to everybody. But now we're finding all these little niche communities, in which we find people that we can actually build relationships with, and that we can trust.
And it's, it feels to me that even in the b2b space, there is a kind of movement towards like making relationships with people, other companies, because that provides a layer of trust than just the business to business, even just contractual. Business to business relationship could not present, right? If I know this person, and I sent them an email, I know they're gonna read it and think of me, not just of the money that they can make for me and my business. That's how I feel those relationships with businesses are starting to become more important as they happen between people, not just between, yeah, companies.
Andrew Gazdecki 15:39
Yeah, and I think you hit on something good there with, you know, just the importance of just adding value to whatever community that you're serving, and have no expectation of anything in return. That just pays dividends over and over and over. So that could be through his social account, that can be through, you know, giving away a product for free, creating educational materials completely for free. But yeah, like really adding value to these very specific communities, I think is, you know, a smart strategy for really, any company really. And you should be doing it.
Arvid Kahl 16:18
Yeah. And you have been, right?
Andrew Gazdecki 16:21
Yeah. But it's kind of like a, I don't have like a strategy around it, though. I wish I could give you like, here's what I do day to day. But it's usually just kind of ad hoc, like. So I don't know if that falls under authenticity, or just, I don't know, random madness.
Arvid Kahl 16:43
Yeah, probably you don't need like a really thought through strategy. I think the impetus, the wanting to help people, that is enough. You know, that's enough to make you do these things over time. You don't need like a spreadsheet. And you know, every day I help for people in one specific way. I think some people might need this. But if you have a more loose approach to this, I think like sharing whatever comes to mind, when it comes to mind, with the people that you think and use it best, that's kind of, at least that's my approach in many ways.
But you've also been doing this in a more formal sense internally, right? You've produced a lot of internal tools for founders who wanna sell their business to, you know, do P&L stuff, and to prepare for due diligence and that. And I feel that is adding value, also, like for people at a very, very important stage, just coming to terms with, “Do I wanna sell my business or not?”
And I've been very excited to see this because most companies that did this service that you do, which I would call brokerage, I'm not sure if that's the right name for it, but it's kind of you try to find buyers for sellers. It’s the best term I can come up with. They have done this really like behind closed doors. They take on your property, they deal with it, and then they give you a price or something. But for you, this is way more in the hands of the founder themselves. What made you choose this kind of approach?
Andrew Gazdecki 18:10
I think it's just what I wanted. And I think maybe just the understanding of the customer helps, if I'm just kind of thinking, you know, back. Because I myself like, again, I'm a big startup fan and nerd. I don't care if you're building, you know, one person startup or 1000 person, I think it's all awesome. You know, I love people that are building stuff. And so I guess for me, just almost being a potential customer myself, like I built something that I wish existed. And I was delighted to see that other people were delighted to see it existed too, if that makes sense.
But yeah, again, I guess just when you understand just kind of like, you know. When I look at the market, you know, again, I saw, basically a lot of fragmentation. So there was no central place to really sell your business. There's different brokerage firms, but there's no real differentiation from what they do. It's service based. There wasn't really any innovation in terms of making things simpler, easier, faster, more efficient. And that really starts to culminate into a large opportunity.
And that's when I kind of have my moment of like, “You know, I'm gonna try and see if I can actually make this work.” And also, how do you position that? How do you get the word out? How do you, you know, stand out in a crowded market of, you know, this broker, that broker, this marketplace, this other marketplace? So my idea was to just kind of scratch my own itch and build tools that I would have wished, that I wish I had when I was selling businesses or just the marketplace that I thought, you know, the startup ecosystem as a whole really needed.
And I know that's not very like methodical or, you know, informative of like this master plan I had, but it really was just kind of scratching my own itch. Like just, I wanted a marketplace where you could find buyers within minutes where we made legal documentation creation easier or free. It made due diligence faster by being able to connect financial metrics, being able to keep things private. Because funny story when I sold business apps, I remember the day I told employees that I was selling the company. I have like all-hands meeting and I'm like standing about some podium or something like that.
And I tell everybody, and then I say, “Hey, I'm gonna be over in the back. If anyone has any questions, you can come ask me, you know, one on one.” And like, the questions were so crazy. They were like, am I a billionaire, like a millionaire? Or like, what am I getting fired? Like, you know, so that's what I knew, like privacy needed to be, you know, a big piece of it. And then just trust and security in terms of preventing, like scams. So just kind of, you know, taking my personal experience, and then just looking at what was already in the market and realizing this needed to exist and was missing in the market. That's kind of how it all happened, I guess.
Arvid Kahl 21:45
It makes sense. I mean, yeah, the privacy parts with employees, that's always a story. I watched a little documentary that Patrick Campbell released a couple of months ago about his sale of ProfitWell to Paddle. And I think they also had filmed the moment where he told the team, that was an interesting shot, that everybody's like, “Oh, what's going on?” You could see them mind's racing, just figuring out okay, what is my job gonna look like in a couple months? Am I gonna have a job? Am I rich? Like exactly what you said, like, people just need information at that point, and you may not even be in the place to communicate that. Okay, because it's an early stage of the whole process. So keeping this under wraps for a while, probably a good idea.
Andrew Gazdecki 22:34
Yeah, like, another funny tidbit is. So I mean, one of my biggest fears when selling a business was my team finding out and then it falls through, because then you have a whole team wondering, okay, when are you gonna sell the business? Like, I should probably quit, because I'm either becoming a millionaire or billionaire. I'm getting, you know, like, those questions are still in their heads, and you don't have an answer, and you don't have a buyer.
So when we were going through due diligence, it was my VP of engineering, CFO and chief customer officer. And I believe, maybe one more person, and when you see kind of all the, you know, VPS, and you know, the CEO and stuff in a room for like weeks at a time, like what's going on. And then I told, I was like, “Oh, we're just being audited by the IRS. We got to compile all this stuff. And we had previously been audited.” So just in case it fell through, because we didn't know if like the offer was real, or if we get to the finish line, because, unfortunately, deals do fall apart all the time. And it would suck to like tire company, and then it doesn't go through and then you're kind of like, “Well, let's keep going, you know,” so.
Arvid Kahl 23:47
There's a motivation problem, right? Like you have this, like, you've shown your cards kind of where you want this to go, particularly, that it might end. And that's kind of hard to keep people like infinitely motivated, at that point.
Andrew Gazdecki 24:00
It's a setback, you know. When you make the decision to sell, you know, you really wanna be in that mind space, and you wanna let your team know, ideally early in the process, but not early enough to where, you know, you run into a situation where it distracts everybody and it falls through and then you're left without a buyer for potentially another year or something like that. Because you could lose employees over it or even worse customers. So that was an interesting experience.
Arvid Kahl 24:32
Yeah, I guess any kind of instability causes trouble, like some kind of churn either employee churn or real revenue churn. One thing I just heard, was you saying that you were in the room with all your VPS for weeks. Does that mean that you were not really prepared for next it? I’m just asking, right? Because due diligence takes a long while and depending on how and who you sell to. It has a different kind of intensity. Were you prepared? Did you ever consider it to be a business to be sold, at the point with business apps?
Andrew Gazdecki 25:04
Oh, yeah, I don't understand. If I'm in Canada, I understand when people are talking about like, just make, you know, run off the profits for like 20 years or something like that, because I always ran business apps at breakeven. So any profit that we had, because I've used it as an asset, so I can either take the profit or reinvest the profit into the most valuable asset that I had. And I had control over the growth and the value of it. So I kept pushing growth, constantly on the business. It was profitable within the first like, two, three years, because it grew from like zero to 3 million in the first two years, if I'm recalling correctly. And then three to seven, it just grew to a point, like faster than we could spend the money.
And then I ran it from breakeven, after we had, like, let's call it 2 million or something in our company bank account. And then, so yeah, during the due diligence process, given the size of the company, as a company it’s bigger than employee contracts. You have to go over, depending on who you sell to, due diligence can look entirely different. But it was just the complexity of the business because we had, you know, an iOS team, we had an Android team, we had a customer service team, we had a sales team. We had international employees. We had, you know, there was just a lot of moving parts of the business. It wasn't like a Shopify app or something like that.
And so the more complex your business is, the more due diligence that's gonna be required. And then the firm you sell to, or the company that you sell to depending on, you know, their due diligence requirements. It all depends. But the due diligence that we did with the firm that we sold to, the private equity firm, it was just like a fast pace, like 30 day due diligence, like checklists that we got, and then we had to just run through it. So it wasn't fun. But we made the best of it.
Arvid Kahl 27:07
Yeah, our operation was a bit smaller. Our due diligence was also a little bit smaller than that. But checklist style probably is just what a SaaS acquisition, like a financial acquisition looks like, right? If there's a surprise, then they know where to look for it at that point, and then they'll figure it out. You've been writing about this, like you wrote a book, just wanna mention that because I really enjoyed it. First off, because it's a great retelling, I guess, of your story, coming to where you are right now, and why you're doing what you're doing.
Also, the second part of the book has a lot of really succinct and all over the place in the best sense of the word tips for how to build a business that is actually sellable. My strategy has always been a good business is a sellable business, and the sellable business is a good business. So anything you can do to turn your business into a better business also makes it more sellable. Do you have like, now with your insight into so many businesses that I don't know like how many hundreds, thousands of businesses have been sold on MicroAcquire at this point?
Andrew Gazdecki 28:11
Probably, I'd say over a thousand at this point. We average about like 75 to 100 per month. And this last month, we did about 45 million in acquisitions. In the previous month, we did about the same, so it's shockingly, you know, the deal sizes are getting bigger. So that's been fun to watch. Because those acquisitions are very meaningful to individuals because you know, million dollars. If you're a business, it’s a fantastic outcome. Like you're potentially a millionaire, depending on taxes. And once you pay..
Arvid Kahl 28:52
Not in Germany, yeah.
Andrew Gazdecki 28:55
Yeah, also not in the United States all the time. But if you sell for like two or three million, then yeah, you're a millionaire, which is extremely life changing.
Arvid Kahl 29:04
Now with that level of insight, because you probably have a lot of data, you know, from that. And I don't wanna pry too much if like, any question I'm asking is, like, too specific, let me know. But with that level of insight, have you found anything that is particularly conducive to being acquired? Like any kind of approach to business, any kind of metric that people focus on? Or, you know, whatever it might be, that makes the business more sellable. Have you found anything there?
Andrew Gazdecki 29:31
Yeah, I think it depends on what price range you're trying to sell in. Like, for example, when you get past, a lot of people don't know this, but when you get past a 10 million in annual recurring revenue, your buyer pool unlocks to a completely different set of buyers. And I don't know why it's at mark, but around 10 million in recurring revenue, you get exposed to a completely different type of buyer group than you would at say 2,3,4,5 million
At that price point, you're gonna be working with different firms. So they're gonna be looking for things like, you know, profitability. You know, at 10 million in your current revenue, if you’re breakeven, they're gonna be looking at, you know, typical metrics, like, what is your turn? What is your growth rate? You know, how profitable could this be? Or how much farther can this go in terms of growth?
So it really depends. But if we wanted to, like put together a million dollar business, all the time, I see simple Shopify apps made by you know, two people or something like that. Very, very low in terms of expenses, highly profitable. Those businesses tend to sell really, really quickly. And then as you get kind of bigger, you know, I think just defensibility is probably the next thing I would point to in terms of, you know, is there a platform risk? Is there, you know, some sort of unique moat around the business. How stable is it? How long have you been in business? Those all kind of can push up your final sale price. And then I mean, really just having a great business. I know, that's kind of a cop out answer.
But, you know, there's a saying, like, the best businesses sell is a business that you don't wanna sell, because it's growing, it's doing well, and that will attract the most buyers, because it truly is a great business. And then, you know, if you go below a million, I would say, you know, quality of product is really important.
But then, really, throughout every bucket that I'm describing below a million, or 5 Million and above, you know. Just having your numbers in order is just so important in terms of, is the business capital efficient? Are you just losing a ton of money? That's terrible, like, it's really, really hard to sell a business such as losing money, month over month. So having either some path to profitability, or ideally being profitable, is how a lot of buyers will value your business. What are some of the things I've seen?
I mean, I've seen so many different, like, you know, types of businesses sold. It's hard to really say this is like the exact formula, because there's also so many different types of buyers for different types of businesses, whether that's SaaS businesses, you know, SaaS and MarTech. Or it could be SaaS developer tools. It could be E-commerce, direct to consumer businesses. I work with funds that are specifically rolling up Shopify apps. So there's also kind of buyers for every type of business that you could kind of think of. It just needs to be a healthy operational business, that ideally doesn't need to have you in the business to run. Like if you as a founder steps out, everything falls apart, that makes it business much harder.
So that's probably another tip is, you wanna have a way to, you know, show that this business can operate without you or if you're not there yet, then have, you know, some sort of transition plan in place with the buyer. Like when I sold business apps, I was the most useless person at that company. So it made it easy to, you know, make the transition because I really didn't even know how things worked at that point.
Arvid Kahl 33:33
Was that intentional? Did you build like a franchisable or kind of be replaceable kind of position for yourself there?
Andrew Gazdecki 33:43
I was, I actually considered stepping down as CEO and making my end hiring on a CEO and then just stepping back. And then we had an offer to sell the business. And so I went down that route and said, but no, I just had such a great team. I had, engineering was taken care of, you know. Customer support and sales was managed by this wonderful lady, Rose Romaine, who is probably one of the best individuals I've ever worked with. You know, I had a fantastic CFO. Everyone was just so great in the business that I really, I would still do stuff like I mean, I didn't just do it. I'd still do like sales calls with the sales team.
And I’d still do support calls with the support team. I'd still be very involved like in the product, but I wasn't truly needed. I wasn't like the bottleneck anywhere in the business. And I think when you get to that point within your business and your business becomes really attractive to buyers, because they know without you, you know, they can find a new CEO. They can, you know, maybe bring in someone with strengths that you don't have or something like that. So that's just a personal tidbit.
Arvid Kahl 34:56
Sounds like the dream for every solopreneur is to not be needed, you know, in business. And probably the hardest part too, right? Because if you build your own thing, and you don't hire immediately, you try to do as much as possible, then you kind of make yourself like an irreplaceable, eventually. Because you know, you take all of the jobs and you do all the things. Do you have any, like, at what point did you start hiring? Because that's what’s been one of my problems, like I hired way too late. I did way too many things by myself, and probably could have grown the business to a much bigger size had we hired earlier. I mean, we still sold them, we sold well. But, you know, you always wonder like, what is a good time to start hiring? How did you do it?
Andrew Gazdecki 35:42
For business apps, I mean, since we bootstrapped the business, we had a saying only hire when it hurts, and it hurt pretty much the entire time. So you know, I think looking back that it could have been a bigger business like yours, if I'm being candid, if I had hired people earlier, but I was so young. I just, you know, I remember specifically a moment where we needed a VP of marketing really bad and they wanted like 200,000 as a salary. And I was like, “There's a way of paying that.” And I'm like three years out of college or something like that.
But in hindsight, you know, what you wanna do is you wanna hire people smarter than you as soon as you can afford them. Because they're creative to the business. And what I mean by that is they'll add so much value and improve the business to a point where you never could on its own. They’ll pay for themselves, essentially, by adding new customers and processes or just, you know, reducing your overall stress, or how much you're working in the business, and allowing you to work on the business. So when you start hiring, I mean, as soon as possible, you know. I think as soon as you can hire someone to take over support.
But another tidbit I would say is, I think it's extremely important for founders to understand the roles that they're hiring for. Like the amount of startups I've heard, having mishires in key roles, like head of sales, or head of marketing, usually stems from not understanding, you know, what type of sales leader do you need? Or what type of marketing leader do you need? What type of sales process do you have? Is it really transactional? Is it midmarket? Is it enterprise? All those factors, you know, you need to kind of live, you know, live the life of that role for a little bit. And, you know, then hire when it hurts when you can't, you know, manage the sales team anymore, you can't manage the marketing function of the business.
But I think, you know, in terms of, let's say, we're talking about bootstrap businesses with less than a million in revenue. I think, you know, the first hires you should make are definitely in support. But I do think you should be in support, like with MicroAcquire, I did all the jobs, all of them. And it wasn't. And I also, this is kind of a maybe another tidbit is, you know, those are the businesses that I think really go the farthest is the ones that you enjoy running so much that you're willing to do everything. Because you wanna learn from your customers, you wanna learn how the products work, you wanna be involved kind of everywhere, but you can't do it forever.
And then at one point, you need to take a step back, document the processes, and then begin hiring people, ideally better than yourself. So you can start working on business. But you know, when you're just getting the business off the ground, you have to work in the business and kind of do everything to learn how to, you know, how are we gonna scale this thing? And where do I need the most help? So to answer your question, again, when to hire, I would say as soon as you can afford it. And then number two, as soon as you feel you understand the role well enough where you can hire someone competent enough to take the role over, and do a better job than you're currently doing yourself.
Arvid Kahl 39:07
Well, thanks for pointing out this distinction too, like, between intent on the business, right? Working in the business is doing its stuff and working on the business is making the business better. I think, for people in the indie hacking space, I see this a lot. They really enjoy working in the business because they're technical, they wanna build the product, they wanna build the thing. Anything beyond that, anything that would actually make the business grow, not the product better, not another feature to improve the product. But you know, building relationships with other businesses in the space, building integrations with other businesses in this space to, you know, increase the kind of potential customer flow from other platforms.
All of that feels threatening to them. So they stay in their little technician role, which is like I guess one of the three roles that Michael E. Gerber puts out in the E-Myth, you might know his book. You have to technician, you have to manager and you have to visionary. And as a founder, you usually have to be all three at the same time. And I think you are because you want to be because you've understood this.
But some founders, they only wanna be the technician because they think, hey, if I'm just building a good enough product, it's gonna sell itself. If you build it, they will come, you know, that kind of stuff. So, to me, that was a problem, because I also really enjoyed the technical role, and everything else was kind of scary. And I had a co-founder, right? And I was still blocking myself from going into these fields, or even finding help for myself to be able to work on the business more. So I think that, that is something that's really hard to deal with.
Andrew Gazdecki 40:36
I would agree. And I think, you know, just understanding what you're building. If you don't step out of your comfort zone, you're just kind of building a job for yourself, rather than building a business that can scale. And I can, again, operate without you. And that should be your goal. And it's kind of weird. It's, you know, if you really wanna be a business, or build a business, you know, you need to kind of fire yourself from everything, which is very ironic, when you know, being CEO of a company is your only job or it's a good thing when you're fired from stuff.
But, you know, I think that just holds a lot of people back is the fear that, you know, of giving up control, so to speak, not being able to trust other people with decisions. Or to make, ideally decisions on their own or even fail and make decisions on their own again. And you need to just kind of accept that as your business grows, you need to grow with it. And that means relinquishing control, that means trusting employees, that means understanding you can't be involved in every single decision, because if you are, you're gonna be working 12,18 hours a day, and that's not sustainable at all. And I don't recommend it.
Arvid Kahl
Yeah, that's a burn out, right?
Andrew Gazdecki
Yeah, unless you wanna burn out. But again, just having the distinction of what are you trying to build. Because also, I think it's completely awesome, if you just wanna have, you know, you don't wanna manage a lot of people. You wanna have just a one-person business. You know, I see those get acquired all the time as well, for quite a bit of money. And I kind of question myself, what am I doing? Like these people are, like, these two people worked on this for a year, and they made like, a couple million bucks. So that, I don't wanna say that's not, you know, like, don't do that. Because sometimes that is, you know, fine. But it is limiting. I think this quote might be relevant, where, you know, if you wanna go fast, you go along. But if you wanna go far, you're together.
And so, if you wanna build a business that can scale well beyond, you know, 1,2,3,4,5 up to 10, or beyond million in revenue, you're gonna need to build a team. And so, you know, it's a hard shift for a lot of entrepreneurs. And it was for me, too, if you read my book. I mean, I talked about it quite a bit where, you know, I got to a point where I realized, you know, I need to hire people smarter than myself in order for this business to scale. And when I finally did, it was the best thing I could have ever done for the business.
Arvid Kahl 43:16
That sounds like a tough choice. But you know, the choice that you need to make, and I think you have to grow into it. You just talked about relinquishing control, right? About giving up things that you have control over giving it to other people. And I think an exit is the ultimate relinquishing of the control, like being acquired.
And I've always wondered this about you, after exiting such a company for such an amount of money that is fairly high, right? Why did you keep building businesses? This is probably one of those questions that every person exiting gets, but with you in particular, I would like to know, why did you jump into building the next thing? And I guess you, you said in your book, you splurged on two things, which is a house and a car, which is exactly the same thing that we did after our exit. So there's not much splurging, to be honest. Why go right back into building businesses?
Andrew Gazdecki 44:16
Yeah, that's a fascinating thing about entrepreneurs is, I think, just, you know, you feel the most, at least to me personally, it's something I've just come to just accept about myself that I truly love to build businesses. It’s just a sport that I like to play. And so when I'm not playing it, there's nothing that really kind of, you know, brings me that fulfillment, if you will. So I'll probably always be building businesses. I've just kind of accepted that. I've been like that since I was a teenager.
And so just even as when we went into due diligence with business apps, when I started working on a new startup, because I immediately was thinking like, “Oh no, what am I gonna do when this one closes?” So right and I don't recommend that. I recommend take a break, like, in retrospect.
Arvid Kahl
Don't do as I do.
Andrew Gazdecki
Yeah, I mean, I definitely do wish I took some time off, you know, enjoy, you know the wind, but I just went right into new company, new problems, new team, new challenges, you know. New wins, you know, new stuff to celebrate and new stuff to cry about. But yeah, I would say I just love building stuff. I just I think it's something I'll always be doing.
Arvid Kahl 45:34
Sounds reasonable, I mean, we wouldn't be talking if I hadn't done the same, right? Kind of I could also sit somewhere on the beach and do nothing but, why would I? It’s so much more enjoyable.
Andrew Gazdecki 45:45
Yeah, I wanna, even when I go on vacation, I can't be away for I mean, a week is probably the max. And then I started getting just like, I wanna get out of here. I wanna go back to, you know, for like it, just it, I think, put another way, you know. I think about this often, but, you know, I feel really blessed to have, you know, gone down a career path where I truly enjoy everything that I do.
And, you know, if I do a good job, you get paid money for it, which is great. And so it never really truly feels like work to where I'm like, pulling my hair out, or I'm super stressed out. You know, I'm just doing funny stuff and building stuff. Like it's just, it's fun to me.
Arvid Kahl
I could tell.
Andrew Gazdecki
Another way to put it is, you know, I always say, you know, some people like to play tennis on the weekend or basketball or whatever. I generally just like to play startup. That's kind of the main game I like to play.
Arvid Kahl 46:47
Right. It certainly is an enjoyable game when it works, right?
Andrew Gazdecki 46:52
I mean, even when you fail, I think that's awesome, too. Because it does hurt. It does, you know, when things don't work out or whatever it may be. But I mean, it's just I've come to the conclusion that you cannot succeed without failure. Like, it's just something you have to go through. And you learn so much from it that I think, yeah, it does suck. I mean, let's leave it there. But it's part of the process.
Arvid Kahl 47:20
You're right. And it's not that we're glorifying it either, right? It's just a normal part of experiments that some of them go wrong. Really, that's kind of, that's how I internalize it for myself.
Andrew Gazdecki 47:32
Yeah, I mean, if we really define what a startup is, it's really just a series of experiments. And then eventually gets something right. And then it works, you know, so you kind of fail, fail and fail, and you try this and this. And you get to try that to marketing sales, like you're just constantly trying different things, and you're failing, failing, failing. And then you get a breakthrough. And then it works. And then it kind of makes all that failure, just, like worth it, if that makes sense.
Arvid Kahl 47:59
Yeah. And more and more, I see people doing this in public, like building in public, obviously. By building the businesses in public, like building their careers in public, whatever they might be building. And even if they fail, one thing that I noticed is the next time they do something, they have more attention. They have the higher initial crowd of people looking at it.
And even if that fails, the next time they do something else, even more people look at it, right? Because there's always something about joining somebody's journey to an eventual success. People wanna be part of that. They kind of wanna be stuck with a rock band or any music band that people like. You wanna be the person that was at their concert when nobody knew them. That's kind of how building in public is attractive to people. They wanna see the successful people before they are successful and be part of their journey, maybe even help amplify their story. The narrative so that the journey can become successful, which is why in particular being a builder in public, failure is just yet another little stepping stone. Oh, yeah, that's something I really wanted to ask you. Because you see exits or acquisitions of all kinds of sizes.
And there are kind of two paradigms in the space. One of them is the Stair Stepping Approach. You know, the Rob Walling start with an info product and then go maybe into services or cyber service and then info product and then build a SaaS and so on. Or the kind of Shoot for the Stars mode. I'm gonna build this business and I'm gonna start it and it's gonna be great. Out of these two, Stair Stepping and Shoot for the Stars. What do you recommend for founders who are getting started, like who are not an established person yet, who don't have an exit behind in their history just yet?
Andrew Gazdecki 49:38
Oh, Stair Stepping, for sure. And I think if you look at every successful founder, you'll see some form of stair stepping. Like before business apps again, I had like a job board that I built. I had like a web design company that I built. I sold a bunch of stuff on eBay, you know, so like. I don't know if those count, but it's not that I just went straight into like a SaaS business. So my point being is, yeah, like, you know, I always say, you know, start an agency, and figure out what you're really good at.
And once you like to do, so kindly take a step back. Because I think, you know, the market that you pick and the customer that you pick to serve is so important, because it's so hard to compete against a founder that loves what they do, and it feels like work to you. So I mean, Stair Stepping all the way. I think, you know, if I was just to start, like everything over, I would probably start like a podcast like you.
And then it probably start like a newsletter, and then I probably figured out, “Okay, well, how do I monetize my audience?” And then I build a product around, you know, it stirs up into it. I think that's so much more practical, rather than taking the 1% chance of success shot. You know, you kind of increase your chances, you know, and then also your experience as well, which increases your chances of success. So definitely, definitely Stair Stepping.
Arvid Kahl 51:04
Well, what's the next stair step? Sorry, for my current choir. Where's MicroAcquire going? What are you gonna do with that in the future?
Andrew Gazdecki 51:14
We're dropping the Micro, so it's gonna be just acquire.com, pretty soon. And after that, I think we'll just have to find out.
Arvid Kahl 51:24
That's a big deal. I think, from a branding perspective, obviously, but it kind of suggests to me that you're going for the whole market. Are you still gonna try to focus on smaller businesses, or you're gonna try to incorporate every kind of size at this point?
Andrew Gazdecki 51:42
Yeah. I mean, I started MicroAcquire to help, you know, founders of all sizes. Like whether you're trying to sell a business for 10,000. But I never expected MicroAcquire to really be able, like, if your business is truly worth, you know, 10,50,100 million dollars, there's buyers on MicroAcquire that could facilitate that transaction. And I think, you know, a lot of founders don't want a micro acquisition. They wanna maximize their exit. So I think dropping the micro kind of helps us, you know, with the perception, like, we can actually help with these larger acquisitions too.
But then, of course, like, we're always, I love seeing like someone in a different country. Like one of my favorite stories is someone in India who sold a platform for let's call it, you know, 200k. And they wrote me this really nice email, and they paid off all their debt. They bought their mom a house, like we always wanna support that stuff. So I would say, you know, micro, macro, whatever size your business is like, we're always gonna support those acquisitions. And we're gonna, and I think they all deserve, you know, equal recognition, and, you know, celebration, if you will, because it is a huge accomplishment, regardless of the number.
Arvid Kahl 52:59
Yeah. Any acquisition, right? Any exit, no matter how, no matter where, even if you raise capital, at some point, that is already also a feat that not many people actually get to do, right? So any step forward and any step that gives you more financial security yourself is a good one. Yeah, I'm glad to hear it. Because I also know like you coming from that background, you won't forget small founders, right?
You're not just gonna wake up one day and think, “Oh, I'm not gonna look at these people anymore.” Like you're part of the community. And people trust you with that. And since we're talking about community, where can people find you? Where can people learn more about you and what you do? And where can they sell their business? That'd be interesting to know.
Andrew Gazdecki 53:41
Yeah, on Twitter, agazdecki. Or you can shoot me an email, andrew@microacquire.com. Or just go to microacquire.com and check out the marketplace. But I'm super accessible. I'm one of those “inbox zero” weirdos. So if you shoot me an email, it'll get answered.
Arvid Kahl 53:57
That's bizarre because I'm one of these inbox 70,000 people, but I do..
Andrew Gazdecki 54:02
I can prove it on my phone right now. Even on a, oh, I got 8 emails.
Arvid Kahl 54:11
Sorry about that. That's I guess, we’re talking for an hour, huh.
Andrew Gazdecki 54:14
Within the next hour, I’ll have zero emails again.
Arvid Kahl 54:18
Man, thank you so much for being on the show. That was really sweet. Thanks for all your knowledge and helping people getting acquired. That is a big deal. So thanks so much for being on, Andrew.
Andrew Gazdecki 54:29
Yeah, thanks for having me on. And thanks for everything that you do as well, man.
Arvid Kahl 54:33
Pleasure. Thank you!
And that's it for today. Thank you for listening to the Bootstrapped Founder Podcast. You can find me on Twitter @arvidkahl, ARVID KAHL and you'll find my books here too, sold in The Embedded Entrepreneur and my Twitter course, find your following there as well. If you wanna support this podcast and me, please go to ratethispodcast.com/founder and leave a rating and review, if you can find the time. It would be an amazing and very helpful gesture. Thank you so much for listening, and have a wonderful day. Bye bye!

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