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Walling on Selling vs. Automating

·3 mins
Table of Contents

Grow it or Start Over?

  • The option to automate your startup tends to be the best approach

  • You spent months building your application and bringing it to market

    • If it’s profitable and you spend no time on it, why sell?

  • Once automation is in place it’s almost as if the first product falls off your radar and you are freed up to start another

    • You can do this without selling or closing it down

  • By having a product portfolio you diversify your income, and thus diversify your risk

  • Knowing you can….move on to another idea in 6 months….once you get it automated frees you up to take more risks

  • I find it more interesting on a day to day basis to work on multiple products

  • Only when you begin to feel like you have a lot of free time while your first product continues to generate revenue…

    • ….should you consider making the move to Serial Micropreneurship

  • Three areas that will require ongoing maintenance:

    • Support
    • New Features
    • Marketing

  • Every time you receive a support request, your first thought should be “how can I make sure I never receive this question again?”

  • It’s likely you will be able to hire domestic to handle your front-line email support

    • You will pay more for someone in your own country, but they will be fluent in your language and better able to provide higher-quality support

  • Once you’ve found keywords that convert and ads that work,

    • ….you only have to adjust as your competition changes

  • If you monitor your traffic using Google Analytics and compare month over month…

    • ….you’ll notice when there’s a decline for a specific keyword and you can investigate

  • If automation doesn’t work out, selling your product is a good fall-back plan

    • You’re not going to get as much as you feel that it’s worth
    • Valuations are based on multiples of profit
    • A website or domain name typically sells for between 6 and 24 months of net profit
    • The other factor….is how much time is required each month to maintain your product

  • Key metrics you should track:

    • Traffic Stats – I recommend using Google Analytics
    • Revenue and Expenses
    • Monitor Your Domain and Business Names using Google Alerts
    • Track every minute you spend working on your product, broken down into development, support and marketing

  • Don’t use open source or third-party code that could raise licensing issues down the line

  • If you decide to sell your product, your best bet is your professional network

    • Your first option should be to email colleagues and float it to your LinkedIn connections
    • Mention the following:
      • Your Price Range
      • Non-Disclosure Requirement

  • Prepare Your Sales Kit:

    • Detailed summary of product in PDF:
      • Product Overview
      • Customers
      • Technical details
      • Positive reviews and high-profile links
      • Revenue
      • Expenses
      • Partnerships
      • Personnel
      • Competition
      • Website traffic
      • Assets included in the sale
      • Price range
      • Future plans (surely you will have a list a mile long)
      • Non-compete – Mention whether you are willing to sign a non-compete in this space

  • Escrow.com facilitates the exchange of your product once funds are deposited in an escrow account

  • The eBay of website and software sales is Flippa