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$200K in recurring revenue - is pretty much the annual employee cost of a single average position at the companies you mention all in (office space, salary, ben
by privateSFacct 8y ago
$200K in recurring revenue - is pretty much the annual employee cost of a single average position at the companies you mention all in (office space, salary, benefits, indirect staff overheads (HR/Accting etc)).
In other words, to them, your business is very small. Other than aquihires - at a 5x multiple, $1M, does aws even go through the acquisition cycle for that type of business unless there is a much larger market presence - ie, a big free product side to your business?
If you want to sell its going to be to a different class of buyer.
You may be surprised at how sticky your customers are if you have an OK product even if the big players move in though. You might not get tons of new ones, but folks hate moving.
- ryanSrich 8y agoYeah unfortunately $200k is entirely meaningless. In fact, any revenue sub $100m is pretty much meaningless to a large CSP like AWS. For OP's business the price would be 100% strategy driven - ex: you've garnered some marketing attention, you've built some novel IP, or you've hired some hard to come by talent.
- derefr 8y ago> In fact, any revenue sub $100m is pretty much meaningless to a large CSP like AWS. What if OP is severely undercharging for their services? They could be providing a service that a bigcorp could charge $100k per (enterprise) customer for, at consumer prices. I’d think acquirers would be very interested in acquiring—and then killing—the product in such a case, to remove memory of its price-anchoring influence from the market ASAP before introducing their own much-more-expensive one.
- privateSFacct 8y agoThat's very unlikely. What can happen though is OP is giving away a ton of service (think github or instagram) and so a big firm can think long term on monitization.