Ep 534 Why a "short list" of acquirers may be a trap

Andrew McConnell built a SaaS company that helped vacation rental managers price homes like airlines using dynamic pricing based on demand. He eventually successfully exited, but not before learning the hard way that building a company and selling one require two entirely different skill sets.  In this episode of Built to Sell Radio, Andrew walks through the pivot that saved his business, why his VC backers stayed on board, and the exact moment he realized that a "short buyer list" is a dangerous trap for founders.  Listen in to discover how to:  Spot the "hidden ceiling" in a business that looks like it's doubling—right up until it isn't.  Move a cap table from a failed bet into a new one without lighting your professional relationships on fire.  Understand liquidation preference in plain English (and why it can erase a founder's take-home pay at exit).  See why a banker's real value isn't just managing the process—it's forcing pressure and widening the field of potential acquirers  Avoid the "I can sell this myself" mindset that often results in a year of free research for buyers and zero leverage for you. 

This episode is part of our Inside the Mind of an Acquirer series, and it unpacks the ETA (Entrepreneurship Through Acquisition) wave now flooding the market.  For business owners, ETA is a double-edged sword. On the upside, more buyers courting you means more choice, more urgency, and more liquidity. On the downside, many ETA buyers are first-timers who lean on heavy leverage and seller financing. If they misread your business or hit a snag they can't handle, the part of the deal you financed can quickly become the part you never collect. 

We often think of a "successful exit" as handing over the keys to a perfectly oiled machine—a business that is growing, profitable, and operationally sound.  But what happens when the machine starts to sputter?  What if the margins are too thin, the operations are exhausting, and you are simply burned out?  It is easy to assume that a broken business model means a worthless company. But as this week's guest on Built to Sell Radio proves, sometimes the individual parts are worth more than the whole.  Meet Jason Patel.  Jason built Transitions Education, a college counseling marketplace. On the surface, it looked great: upper six-figure revenue and a noble mission. But under the hood, customer acquisition costs were eating his margins, and he was carrying $250,000 in personal debt to keep it afloat.  He was ready to walk away. He assumed he had zero leverage.  Then, a "Micro Private Equity" firm reached out. They didn't want his headaches. They didn't want his operations. They didn't even want his business model.  They wanted his "parts."  Specifically, they wanted his SEO ranking, his blog traffic, and his 5-star reputation. They realized they could strip away the expensive service delivery and plug his high-performing marketing assets into their own portfolio.  In this episode, Jason breaks down how he structured an asset sale that allowed him to:  Sell the high-value "parts" (marketing assets) without the operational baggage.  Avoid a grueling earn-out (because the buyer didn't need him to run the company).  Pay off his debt and fund his next venture.  If you feel like your business model is grinding you down, this episode will open your eyes to the hidden value sitting on your balance sheet right now. 

acasa helps people run a shared home without the usual friction. It started as a simple way for housemates to track and split rent, bills, and groceries, then added payments and utility setup so households could manage recurring bills in one place.  When Nick Katz tried to sell acasa on his own, the downside wasn't just a slow process. It created a setup where buyers had the leverage: they could keep asking for information, keep "exploring," and never commit to an LOI.

Nick Telson-Sillett and his co-founder built what you could call "OpenTable for bars and nightclubs" in the UK.  Instead of chasing the US (the move most founders are told to make), they went big fish, small pond: dominate their home market first. That focus helped them build DesignMyNight into a business that sold for more than $40M.  In this episode of Built to Sell Radio, Nick shares what happened, so you discover how to:  Turn one clear customer frustration into a business idea you can explain fast  Choose focus over hype when everyone tells you to chase the biggest market  Set a "financial freedom" number and use it to make cleaner decisions  Run a sale process without tipping off competitors too early  Negotiate an earn-out tied to revenue so the targets stay in your control  Plan for the morning after the deal, when your identity gets reset 

The fastest way to make a service company unsellable is building it around a personal brand.  When clients hire you—because of your reputation, your name, and your specific expertise—you haven't built a business; you've built a high-paying job.  And as Gavin Bell realized, you can't sell a reputation.  Gavin was known as the "Facebook Ads Guy" in the UK. He was making good money, but he knew that to build a sellable asset, he had to fire himself as the face of the company.  He rebranded his firm from "Gavin Bell" to "Yatter," productized his service, and systematically removed himself from sales and delivery.  The result? He sold Yatter to a larger agency, Velstar, in a deal that closed just one minute before a major tax deadline.  In this episode of Built to Sell Radio, Gavin breaks down exactly how he made the switch.

Some of the richest founders don't run trendy companies. They run dirty ones. The kind of work you'd never brag about at a dinner party, but that quietly throws off real money because it's hard, risky, and most people won't do it.      This Built to Sell Radio episode follows Shenar Wood, who built an underground power business by taking on personal risk, earning trust job by job, and eventually selling when he hit a ceiling that had nothing to do with demand, you discover how to:    Recognize the hidden ceiling that has nothing to do with demand and everything to do with your balance sheet  Stop confusing "more revenue" with "more value" when margin and risk aren't improving  Build a reputation flywheel where customers feed you better work because they trust how you operate  Separate assets from value so you don't overestimate what a buyer will pay for "stuff"  Fix the financial story before a buyer forces an expensive cleanup under pressure  Negotiate earn-out terms so the buyer can't hit your results by moving costs onto your books  Decide when it's smarter to sell now than grind for years just to add a rounding error to valuation 

Most business owners hit a fork in the road.  Stay "on the tools" and keep making great money. Or start feathering back your personal involvement so the business can grow beyond you.  In this episode of Built to Sell Radio, Dr. Michael Filosi walks through how he made that shift in a dental practice, without jeopardizing cash flow. He didn't rip the band-aid off. He reduced his patient days one day at a time while the practice added clinicians and transitioned patients carefully. Over a few years, his billings went from roughly 43% of revenue to single digits, and he only went to zero once the business was already producing most of his take-home income.  In this episode, you discover how to  Spot the "capped upside" moment when your time becomes the constraint Feather back from four days on the tools to three, then two, then zero Time each reduction using numbers, not hope Transition customers off the owner without breaking trust Remove key-person risk by ensuring no one producer dominates revenue Keep cash flow steady while you trade personal production for enterprise value  The result: Filosi sold his practice and collected 100% of his cash at closing, which is almost unheard of in dentistry. 

Built to Sell Radio just dropped a year-end special that pulls the strongest moments from 2025 into one episode. Across four formats (Exit Story, Inside the Mind of an Acquirer, Mastering the Deal, and After the Deal), you discover how to Choose exit value over lifestyle income before comfort caps valuation Spot the "founder-dependent" trap that scares off serious buyers See how buyers price risk, not just revenue and EBITDA Use imperfections as leverage instead of liabilities Build leverage before a first offer quietly sets your ceiling Create real alternatives so negotiations stop feeling one-sided Prepare for the identity shift that hits after the wire clears

If you're feeling a little queasy about the pace of change, you're not alone. AI is accelerating competition in almost every market, and it's making some business models feel irrelevant almost overnight.  In this episode of Built to Sell Radio, John Warrillow talks with Ryan O'Leary, who saw a similar wave coming in payments when Shopify started bundling merchant processing into its plans. O'Leary chose to sell before the shift crushed margins, structuring a deal that put most of his cash in hand up front. In this episode, you discover how to  • Decide whether to raise capital, hire a CEO, roll equity, or sell • Spot the early signals that a platform is about to "bundle" you into irrelevance • Run a tight sale process with a short target list and still generate multiple LOIs fast • Negotiate for deal structure that protects you, not just a higher multiple • Limit earnout risk by keeping the earnout short and the rules hard to game • Separate emotion from the numbers so you can negotiate clean • Keep your team aligned through the transition by sharing upside, including the earnout