Year 2 in Review: They Got Acquired, for 2023

February 5, 2024

(This audio is an AI version of my voice. It’s my first time offering this feature using Everlit. Hope you like it!)

Before I go into my review for the year, here’s the top-line update:

We’re preparing to launch our data platform this year.

Building a data platform that showcases buyers and deals, with a focus on low-to-middle-market online businesses, has been my vision for this business from the very beginning.

It’s the resource I wish I had when I sold my two previous companies. I wanted to identify potential buyers and see how much companies like mine had sold for.

But it took us TWO YEARS to make this happen.

Here’s why. Two things happened over the last two years that stalled this project:

1) I underestimated how long it would take to establish core business functions around our media business. With bootstrapped resources and a tiny team, moving forward on big initiatives requires my personal time and energy, and all the other things we were doing to grow the brand required my all.

2) I deliberately put aside the database idea completely for about nine months, convinced I could not keep running the media business and build the data platform at the same time – at least not until we had more people to help, which requires more revenue. It took experimenting with several other forms of revenue generation to realize my heart is really with the data platform, and the best move is to go forward with that even though it won’t be easy.

So that’s our big focus for the year ahead: launching our data platform. You can see how it’s shaping up here.

Revenue & profit in Year 2

While there are so many other pieces that make a business successful (I talk about some of those in our Year 1 review), I’m starting this report with revenue and profit because now that we’re two years in, it’s our No. 1 KPI.

This year, we doubled revenue from last year. Most of that came from sponsorships, and a chunk was from a grant. We also made some money off our course on how to sell a business and referrals to our partners.

None of it came from services or consulting. While it’s typically faster to prop up a new business that way, I don’t want to build a services business, so I’ve been intentional about not letting those types of opportunities become a distraction.

This year, we spent almost all of our revenue on operating and growing the business.

Our biggest expense was people: the team of contractors that makes everything we do possible though their writing, editing, design and operations work.

While our revenue covered our expenses, I did not take home a salary this year. That makes this two years in a row that I haven’t contributed to my family’s income.

I’m OK with that temporarily because 1) my husband and I planned for it when we decided I would take a big swing with this business 2) my husband brings home a healthy income from his online business and 3) we socked away money when I had a few high-earning years prior to starting this business.

But I want this year – Year 3 – to be the year I begin to bring money home.

I launched They Got Acquired in February 2022, and I considered the first two years as building years. This year, Year 3, is a make-or-break year, and whether I can take home an income is one of the main measuring sticks.

What worked for They Got Acquired in Year 2

Going into Year 2, we’d set a great foundation for this media business. The content operation was flowing smoothly (though I was still doing most of the editing myself), and we had product-market fit in terms of the value we provided to readers.

The theme of Year 2 was figuring out how we will make money in the long run. The cool thing about media businesses is you have a lot of options for revenue, so if one opportunity doesn’t work out, there’s likely another ahead.

My plan for 2023 was to experiment with different ways of generating revenue, to see which ones fit us best.

We cycled through a number of experiments, and I learned something important, something that will drive the direction of the business: some of our opportunities for making money that had real potential to work, were not a fit because I didn’t want to do them.

I want to build a tiny team with big revenue, and this needs to be a business I enjoy running. For me personally, that matters above all else.

But before we go into some of the experiments that failed this year, here’s what went well.

1) Content operations: Our content machine is humming along nicely. We have what I consider content-market fit, qualified reporters writing for us, and a solid process for publishing stories.

We hired a managing editor this year, which opened up lots of my personal bandwidth to focus on our revenue experiments. That editor oversees about 85% of our content needs, but I’m still doing the last 15% until I can afford to bring that person on for more hours.

We published 93 new posts on the website this year. And 110 newsletters, sending twice a week.

We strategically skipped publishing new posts and the newsletter for a bunch of weeks over the summer and winter holidays, which ended up being a smart choice. It gave us some breathing room and a break from the content treadmill, so we could redistribute energy and money toward revenue experiments.

2) Reports: Our reports were a real hit this year, from so many angles. They brought us new subscribers, drove high-quality leads for our sponsors, and a number of founders told me they used them as data points to make important decisions for their business.

I consider our reports, which deliver data and insights, a litmus test for our data platform. So seeing this traction was integral to deciding to move forward with the platform.

Report graphic showing metrics

We released five new reports throughout the year:

For our first two reports in 2022, we gave away a limited version and charged for the full version. But this year, we shifted to a different model, selling one or two sponsorships for each report, then offering the reports for free to our audience.

With that approach, we brought in tens of thousands of dollars in sponsorship revenue, and also added thousands of new subscribers. Plus, it was more beneficial for our readers, who could get their hands on the insights for free.

3) Sponsorships: We worked with some great sponsors this year, and I’m proud of the value we delivered as leads and brand awareness.

In addition to offering access to our audience of founders through our reports and newsletter, we successfully launched several new sponsored products this year. Helping our readers remember a brand when they need a specific service requires exposing them to that brand repeatedly, over time, ideally in multiple ways. So we developed some creative content formats to achieve that.

For example, we worked with some sponsors to create sponsored videos, where I interviewed their experts to showcase the value they bring and foster trust in that brand. Here’s one of those, a sponsored interview of an M&A lawyer. Several readers wrote to us saying how helpful his tips were. Finding an angle that’s beneficial to our readers while also achieving the sponsor’s goals is a true sponsorship kumbaya.

While sponsorships helped pay for our operations this year, I don’t want to rely entirely on the sponsorship model. In my ideal world, sponsorships are our second revenue lever. They can be hard to sell when the economy’s not doing well, and selling sponsorships sometimes feels like a treadmill. The most rewarding sponsorships, both for us and for our sponsors, have been the long-term relationships where we work together over time.

4) Course: We launched a short course, How to Sell Your Business. It’s a high-level, one-hour video course that’s been well-received by participants. It’s only $99, so we don’t expect it to drive significant revenue, but we’re pleased with the impact it’s made in terms of making the most important information accessible to founders who need it.

Course graphic re: how to sell your business

5) Audience segmentation: We know a lot more about our audience this year than we did last year, as we’ve segmented readers based on information they’ve provided. Knowing more about our audience means we can better serve them. Once readers take a quick survey, we’re able to give them content, reports and other offers that are aligned with their needs. We use Right Message layered on top of our email service provider ConvertKit to achieve this.

6) Brand awareness: I’m constantly amazed at how many people at events I attend have heard of They Got Acquired, especially since our newsletter is still relatively small. I like to think we’re punching above our weight here (as Rafat Ali calls it) because of moves we made during our first two years, mainly using great content and solid design to grow a trust-worthy brand. That positions us well for Year 3.

7) Reliable team: I’m still using a contractors-only model, though I’d like to add a staffer or two once our revenue can support that. Our team played well this year, without much turnover, which meant I didn’t have to divert energy from other priorities to bring in new people. But some turnover is always expected, so I recognize this beautiful break from hiring won’t last forever.

8) Conferences & speaking events: I attended several events this year that energized me, where I felt like I really “found my people.”

The coolest part of going to these events was hearing feedback from our readers, like the founder who said he’d downloaded our latest report and passed it along to his leadership team. That kind of anecdotal feedback was a huge morale boost and reminder that we are fulfilling our mission and reaching our goals, even when we’re not moving as fast as I’d like.

I plan to go to all of these again in 2024:

Lexi accepting an award from Joe
The organizers behind CEX surprised me with a Content Entrepreneur of the Year Finalist award (2023)

9) Saying no: I did well this year choosing what not to do, which opened up so much time and focus for true priorities. For example, over the last two months of the year, I decided to say no to most founder call requests, which opened hours to work on our data platform. Even with that break, I did about 75 free calls with founders this year!

10) Helped founders sell: I saved the best for last. We helped a lot of founders sell their business this year or position to sell in future years through our newsletters, reports and referrals. This is, by far, the most gratifying part of running this business: watching founders reap the rewards of what they’ve built. This continues to be our mission, and it feels good to fulfill it.

Here’s what one founder wrote to us:

Alt text: "A testimonial on a blue background reads: 'Thank you for all your super helpful advice & referrals... You have no idea the role you played in instilling some much needed confidence in me that we could sell our business. Happy to report that we closed on the sale and ended up with a deal we never would've imagined possible. — Founder friend of They Got Acquired.'"

What was OK in 2023, but not great

1) Audience growth: Our newsletter is now at 7,200 subscribers. It’s growing, but slower than I would like. (Here’s how to join the newsletter if you haven’t subscribed yet!)

We did not put much effort into audience growth this year. In my plans for 2023, I’d written, “give myself permission to ignore audience growth for the first half of the year to get our products live.” I stuck to that.

Yes, audience growth is important, and yes, I wish we were growing faster. But too many people use audience size as a be-all, end-all metric, when in fact it should be secondary to profit (and revenue).

While a bigger list is always better (so long as it’s still engaged), I believe our niche audience is now big enough to support our revenue goals – especially since we know a lot about them through segmentation; but we need the revenue drivers in place to make that happen. So we’re still focused on revenue, and audience growth can wait.

2) Referrals: I talk with a lot of founders who want to sell their business in the next few years, and when it makes sense, we refer them to one of our M&A advisor partners. So we put them in touch with a broker or advisor who can help them sell their business, and if they end up selling with that firm, we get a commission.

We’ve made more than 100 referrals over the last two years!

But we’ve only seen a handful of them convert.

When these referrals convert, they can be significant. Say a founder sells for $1 million, the advisor takes about 10% (that’s $100,000) and we get 10% of their cut, or $10,000. If that founder sells for $5 million and the advisor takes around 8% (or $400,000), we earn $40,000.

I would love for this to become a bigger slice of our revenue because it’s so aligned with our mission of helping founders reap the rewards of what they’ve built. Conversions are a win for that founder, a win for our referral partner, and a win for us. And I feel confident that we could drastically increase the number of leads if we decided to focus on this.

But there are a few significant challenges with this revenue bucket:

  • The leads take a long time (in some cases, years) to convert
  • Once we make the referral, we can’t control or even influence the outcome
  • Many of the leads will never convert, if the founder decides not to sell, finds a buyer on their own, or decides to work with a different advisor

In other words, it’s inconsistent and unreliable. I’m still hopeful that more referral commissions will come our way in 2024, but we can’t count on this being fruitful.

There’s also an obvious play here for us down the road, given how many leads we bring in: we could become a brokerage and deliver for those founders ourselves. For now that’s not our focus, but I’m leaving the door open for the future.

What was challenging or didn’t work in 2023

The biggest challenge this year was the same as last year: the juggle.

While I often use that term to describe balancing work and family life – and yes, that was indeed challenging this year – right now I’m referring to juggling all the pieces of this business. I need more hands on deck to execute on our vision, but we don’t have the revenue yet to support that. This is the biggest challenge of bootstrapping.

We tried lots of experiments around revenue that failed this year, and took home some great learnings as a result. Here are a few of them…

1) Membership: I thought heavily about opening a TGA membership, but in the end decided it’s not the best route for this business. As part of that decision, we shut down a small community for female founders looking to sell that we’d quietly run for about a year. Once it became clear we weren’t going to go all-in on the concept, it made sense to reserve that energy for building something else.

2) M&A coaching: We partnered with an M&A advisor to offer a coaching service for founders who want to sell and have an interested buyer. We’re not a brokerage, so we don’t help founders find buyers in a one-on-one capacity – though our data product will be a fantastic resource for that – but I see an opportunity to help founders who don’t work with a broker or advisor and still need guidance.

This turned out to be trickier to sell than I expected, in part because founders don’t want to commit to it unless they know the deal will go through, yet they need the support before the deal gets to that stage. I suspect it could work with some tweaks, but for now we need to focus on the data platform.

3) Workshops: At one point in the year, I went hard down the path of offering workshops about how to prepare your business for a sale. I even sent out a launch email and built a list of founders who were interested.

But when push came to shove, I realized I did not want to build a business based around teaching. That’s not my strength, nor am I excited by the idea.

I still believe our community would benefit from this offering. Perhaps we’ll offer it in the future when we have someone else to teach it. But for now, we’re putting this aside so it doesn’t distract from our core focus.

Here’s the bottom line, the thing I kept thinking about when we were experimenting with each of these ideas: If we committed to one of these, it meant not having time for something else.

And when I was really honest with myself, there was something else I wanted to build more: our data platform. It took eliminating these opportunities one by one to get to that realization.

I hate the question, what would you do differently if you started all over again? Because hitting all of those dead ends is what got me where I am today.

But if it was possible to take shortcuts, I would’ve skipped over those experiments and gone straight to the data. My one regret about this year is that it took me so long to go all-in on the data product.

Looking ahead to Year 3: 2024

That brings me back to the one thing we’re focused on for Year 3: our data platform featuring buyers and deals.

Data you can't get anywhere else (They Got Acquired)

I would like to see this become our primary revenue driver, with sponsorships and referrals playing supporting acts.

We’re aiming for a quiet, early access launch of the platform in April, and later in the year we’ll open the platform more broadly to our audience.

Of course, we’ll also continue to run the content side of the business. This is the tricky part: while our content and the data platform are interconnected, some days it feels like building two businesses.

As a parent, I don’t have more hours to throw at this business; I work about 25 hours/week. So our forward movement will continue to be based on: focusing strategically, team-building and delegation, and being OK with moving more slowly than I would like.

With a little luck, that will be enough.

Thanks for being here, and for all of your support throughout the year.

For questions or comments, please head over to my LinkedIn post, drop any questions into the comments, and I’ll respond there.

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