If he was even entertaining the idea of maybe selling his company, the least he could have done was get a negotiator with mergers and acquisitions experience. If he's making reasonably good money off of Apollo, he could have afforded a few hours of a good attorney.
This call was awful to hear as an entrepreneur. He is not at all clear about what he wants, and I think he's honest when he says it's "mostly a joke" - I'm getting the sense he threw out a strangely-worded scenario hoping that he could perhaps get some money. If he was serious about getting money, and he's primarily a software developer and not a negotiator, it would've been lovely if he had gotten proper counsel for this negotiation.
He wasn't expecting to float the idea! This literally came up during the call. He did not decide days before that he was going to offer to sell his company. He cannot hire outside counsel for something he is not thinking about.
Either way he's definitely ended his entrepreneurial career. Nobody is going to put a dime into a guy who does that - the risk that he'd do something much grander when the stakes are much higher is obviously there.
He should have sold the company, honoured the terms of his agreement.
He was extremely clear that anything less than a multibillion dollar IPO was a pathetic failure, and he’d resign before he’d let such an abomination happen. So his startup is not actually for sale.
An IPO is essentially a partial sale. But, really, if someone came and offered him $30bn right now, would he sell? If so, it's for sale (and, yep, there are certainly people who would never sell certain things at any price so it's not just an academic exercise).
There's an old joke along these lines:
"If I gave you a million dollars, would you sleep with me?" .. "A million dollars is a lot of money, and you don’t look that bad, so I guess I would consider it." .. "Ok, since I don’t have a million dollars, would you sleep with me for $100?" .. "What kind of woman/guy do you think I am?!" .. "We’ve already established the answer to that question. Now we’re just negotiating the price."
He's got dollar signs in his eyes, and he's hoping to use people's desperation for investor money to lower their guard.
Wild guess: He's going to sell you management consulting, in which he tells you all the money you can save by outsourcing your software development. Any 'seed funding' he gives will be eaten up by a deal with him and somebody he knows, who will play the software developer. When that runs out, you'll look for additional funding and spend it on his buddy who shares a cut with him. He might get a share of the company, but I don't think he cares about it.
Look for his interviews. He mentions a software his organization wrote and sold, but the buyer didn't know how to fully take advantage of it. Kind of like flying an F22 as a cardboard box down the side of a grassy hill.
People are unintentionally grading him on a _huge_ curve, essentially "what if...all I had to do was code and App Store?" That would be nice, I get the impression he's had a fun ride so far where that was pretty much it. Now that the thing he's selling isn't free, he can pound the table and quit, or run the business.
I think, his summary is somewhat realistic. But that also applies to his own company.
My base line: Valuation of (consumer) software products is still hard. And given the current monetary politics, it is even harder to tell what a reasonable valuation looks like. It is a gamble, as usual. But at least he has a business and is propably doing his best to keep it, along with the souls in it. Good luck.
You could read the article as sour grapes. Like his business didn't reach unicorn valuation, so well, that wasn't his goal in the first place.
I remember seeing a YouTube interview (I believe it was on TWIST) when he claimed there was no hypothetical amount of money he would take (billions, etc) to sell his business.
The cynical and greedy part of me found it incredulous. Is this guy in denial? Surely you can take the billions, and find some other project to have fun with? Or is Basecamp his only life calling?
The less skeptical side of me envies that mindset. I'm at a point in my life where I clearly have enough. My passive cashflow covers my expenses 3 times over. I'm 31 and If I continue working full-time I'm on par to make $200k next year. But almost every moment of the day I'm obsessed with trying to find my Basecamp. When is it enough? Maybe I should adopt some kids.
I hope that didn't sound like my own version of humblebrag - the fact is, I'm dissatisfied and there's no reason I should be.
The other big component of this that's missing to me is how much he was asking delta to buy it for. If he really invested 100k into it and was asking for some reasonable multiple for his code+idea then it's probably disingenuous of them to not just pay him for it (and maybe pay for him to help dev it).
That said, maybe he asked for something absurd like a billion dollars for what was effectively "a good idea." Hard to know without that and the fact that the information isn't in here leads me to believe that the answer doesn't land in his favor.
Thank you for saying this publicly. If more did the bubble around his persona would quickly pop.
I'd have no problem if all he did was negotiate good terms. He certainly owes his LPs that. The problem I have is presents the persona as being founder friendly. Sadly, he's at the far other side of that spectrum.
chuckle well what's he going to say? "I didn't sell my worthless company to google for billions of dollars because I was so full of my own b.s. I didn't realize I was throwing away the best deal I'd ever be offered in my lifetime?"
This call was awful to hear as an entrepreneur. He is not at all clear about what he wants, and I think he's honest when he says it's "mostly a joke" - I'm getting the sense he threw out a strangely-worded scenario hoping that he could perhaps get some money. If he was serious about getting money, and he's primarily a software developer and not a negotiator, it would've been lovely if he had gotten proper counsel for this negotiation.
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