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Yes, despite the HN peanut gallery's perception of the world, there is actually a market for profitable businesses. It's surely less exciting than selling your

by dhh 14y ago

Yes, despite the HN peanut gallery's perception of the world, there is actually a market for profitable businesses. It's surely less exciting than selling your no-revenue photo service for a billion dollars, but that's ok. We'll be sure to follow the life of Sortfolio after the sale.

larrys 14y ago
I'd love a post on how the price was set at 480k and why specifically you weren't willing to sell for anything less than that figure. Why you drew that line in the sand. Must have been more going on here than meets the eye. If I had to guess I'd would say that the people who bought the site had offered 480k but you didn't want to say that you had a solid offer for a certain amount. Speculating that you told them you would sell to them at that price if a better offer didn't come in. This seems to dovetail with the somewhat cavalier attitude of previous posts and 37signals principals HN comments. "despite the HN peanut gallery's perception of the world, there is actually a market for profitable businesses." I've bought and sold several businesses both as the business owner and as a go between (collecting a commission for the sale of a business).
- dhh 14y ago
  Yeah, you got us figured out. We had an offer, sat on it, invented this story to see if we could get more, and played the world for a fool. BUT YOU BUSTED US. OH NOOOOES! Or, of course, the simpler explanation: We thought the site was worth at least 2x the previous year's take. And if we didn't get that, it wasn't worth our time to deal with the transaction.
  - larrys 14y ago
    I have no idea what I said to get a response like that. There is nothing wrong with what I proposed as a reason and it certainly doesn't rise to the level of "played the world for a fool." in any way. "We thought the site was worth at least 2x the previous year's take. And if we didn't get that, it wasn't worth our time to deal with the transaction." "it wasn't worth our time to deal with the transaction." Your attitude is a total outlier. Enjoy your arrogance. You've got plenty of years to go to see how that works going forward.
    - dhh 14y ago
      You have no idea? You launched wild accusations that we were just playing everyone with our proposal and that we actually just had a buyer all along. If we had a buyer at $480K, we would not have bothered listing it again. We would just have sold it. I think the only reason why you consider my attitude an outlier is because I state it. Every business have a cut off point where a potential return is not worth the hassle. $480K was that number for us. I'll guarantee you that it's much, much higher for most other businesses. Do you think Apple is going to fiddle through $200K purchase negotiations if they want to diverse themselves of a product? Of course not. Just not worth their time. I'm happy how things have worked out for me so far, but thanks for caring.
      - larrys 14y ago
        "wild accusations that we were just playing everyone" You are 100% incorrect as to what I actually did and why. In business what I had suggested as a possibility is not something that would be frowned upon at all. It's the way business is done quite frequently. Do you think games aren't played in business and especially in negotiation? Consequently I wasn't being critical at all according to the way I viewed what you did. I looked at it in a positive way. I've been negotiating for about 37 years and think about it every day and even as a hobby study the actions of a wide variety of individuals and companies. I don't claim to know what you know about programming or rise to your level of proficiency since it's what you do and I would never challenge you on that. But I do know about negotiating and business. The "speculation" that I had was based on my experience. I even called it "speculation" and started my statement by saying "I'd love a post on how the price was set". That hardly sounds like it is coming from someone making "wild accusations". As an aside I don't think that it supports your point to compare your situation to Apple and use the number 200k. Obviously.
        ForrestN 14y ago
        Err, I think what he means is that you implied that 37Signals was lying, that they pretended not to have a buyer, and to be considering shuttering the site, when in fact they knew that they had a buyer. I can only speak for myself, but if that were proven, I would certainly frown upon it. I think a lot of 37Signals' brand, and a lot of its relationship with its audience, comes from their transparency and straightforwardness. I think that context also adds to the sensitivity. If it came out that they were lying to the public, it would be detrimental to them for sure. Not saying DHH answered in the best way possible, or that you did anything "wrong," but you are squirming around the fact that you speculated publicly about them doing something untoward.
ForrestN 14y ago
Excellent, thanks. We hear so much the genesis of businesses but this phase of a business' life is fascinating too. Congratulations.
blake8086 14y ago
That is very interesting! What research went into discovering that there is a market for profitable businesses? This really shatters the idea that the point of business is not to make money.
citricsquid 14y ago
uh, you are aware the majority of negativity and questioning about the asking price was because you did not at any point answer whether or not billing information (and subscriptions) would be kept, even when people on the Flippa auction requested this information? If you'd said from the start this was the case you'd have got many more bids, on HN alone I saw many comments from people stating they would bid if this was the case. Maybe I missed something big or I'm not aware of something, but this was what the negativity was about, not the fact that the site is worthless and can't sell.
- jasonfried 14y ago
  Anyone who was a qualified buyer, and asked privately, got the answer. Lots of people asked privately. We even put serious buyers in touch with our credit card processing company so they could get additional questions answered directly.
  - citricsquid 14y ago
    The comment implied that the average HN user doesn't have the capacity to understand how business works, but the information the buyers had is not what the public had, that's a bit... disingenuous.
    - tptacek 14y ago
      The average HN user certainly doesn't have that capacity. Come on.
      - ThomPete 14y ago
        Now that's disingenuous. :) I am pretty sure you know what was meant.
  - larrys 14y ago
    "Anyone who was a qualified buyer" What criteria did you use to determine a "qualified" buyer? As someone who frequently deals in transactions over the web for large dollar amounts it is not always clear who is qualified and who isn't. Especially if you aren't doing a high volume of transactions so you don't have a pattern established. One recent transaction we handled for someone started off with an insulting offer of $1000 (from a gmail type account in China (qq.com) and ended up at $38,000 USD)

by dhh 14y ago

larrys 14y ago

I'd love a post on how the price was set at 480k and why specifically you weren't willing to sell for anything less than that figure. Why you drew that line in the sand. Must have been more going on here than meets the eye. If I had to guess I'd would say that the people who bought the site had offered 480k but you didn't want to say that you had a solid offer for a certain amount. Speculating that you told them you would sell to them at that price if a better offer didn't come in. This seems to dovetail with the somewhat cavalier attitude of previous posts and 37signals principals HN comments. "despite the HN peanut gallery's perception of the world, there is actually a market for profitable businesses." I've bought and sold several businesses both as the business owner and as a go between (collecting a commission for the sale of a business).

dhh 14y ago
Yeah, you got us figured out. We had an offer, sat on it, invented this story to see if we could get more, and played the world for a fool. BUT YOU BUSTED US. OH NOOOOES! Or, of course, the simpler explanation: We thought the site was worth at least 2x the previous year's take. And if we didn't get that, it wasn't worth our time to deal with the transaction.
- larrys 14y ago
  I have no idea what I said to get a response like that. There is nothing wrong with what I proposed as a reason and it certainly doesn't rise to the level of "played the world for a fool." in any way. "We thought the site was worth at least 2x the previous year's take. And if we didn't get that, it wasn't worth our time to deal with the transaction." "it wasn't worth our time to deal with the transaction." Your attitude is a total outlier. Enjoy your arrogance. You've got plenty of years to go to see how that works going forward.
  - dhh 14y ago
    You have no idea? You launched wild accusations that we were just playing everyone with our proposal and that we actually just had a buyer all along. If we had a buyer at $480K, we would not have bothered listing it again. We would just have sold it. I think the only reason why you consider my attitude an outlier is because I state it. Every business have a cut off point where a potential return is not worth the hassle. $480K was that number for us. I'll guarantee you that it's much, much higher for most other businesses. Do you think Apple is going to fiddle through $200K purchase negotiations if they want to diverse themselves of a product? Of course not. Just not worth their time. I'm happy how things have worked out for me so far, but thanks for caring.
    - larrys 14y ago
      "wild accusations that we were just playing everyone" You are 100% incorrect as to what I actually did and why. In business what I had suggested as a possibility is not something that would be frowned upon at all. It's the way business is done quite frequently. Do you think games aren't played in business and especially in negotiation? Consequently I wasn't being critical at all according to the way I viewed what you did. I looked at it in a positive way. I've been negotiating for about 37 years and think about it every day and even as a hobby study the actions of a wide variety of individuals and companies. I don't claim to know what you know about programming or rise to your level of proficiency since it's what you do and I would never challenge you on that. But I do know about negotiating and business. The "speculation" that I had was based on my experience. I even called it "speculation" and started my statement by saying "I'd love a post on how the price was set". That hardly sounds like it is coming from someone making "wild accusations". As an aside I don't think that it supports your point to compare your situation to Apple and use the number 200k. Obviously.
      - ForrestN 14y ago
        Err, I think what he means is that you implied that 37Signals was lying, that they pretended not to have a buyer, and to be considering shuttering the site, when in fact they knew that they had a buyer. I can only speak for myself, but if that were proven, I would certainly frown upon it. I think a lot of 37Signals' brand, and a lot of its relationship with its audience, comes from their transparency and straightforwardness. I think that context also adds to the sensitivity. If it came out that they were lying to the public, it would be detrimental to them for sure. Not saying DHH answered in the best way possible, or that you did anything "wrong," but you are squirming around the fact that you speculated publicly about them doing something untoward.

ForrestN 14y ago

Excellent, thanks. We hear so much the genesis of businesses but this phase of a business' life is fascinating too. Congratulations.

blake8086 14y ago

That is very interesting! What research went into discovering that there is a market for profitable businesses? This really shatters the idea that the point of business is not to make money.

citricsquid 14y ago

uh, you are aware the majority of negativity and questioning about the asking price was because you did not at any point answer whether or not billing information (and subscriptions) would be kept, even when people on the Flippa auction requested this information? If you'd said from the start this was the case you'd have got many more bids, on HN alone I saw many comments from people stating they would bid if this was the case. Maybe I missed something big or I'm not aware of something, but this was what the negativity was about, not the fact that the site is worthless and can't sell.

jasonfried 14y ago
Anyone who was a qualified buyer, and asked privately, got the answer. Lots of people asked privately. We even put serious buyers in touch with our credit card processing company so they could get additional questions answered directly.
- citricsquid 14y ago
  The comment implied that the average HN user doesn't have the capacity to understand how business works, but the information the buyers had is not what the public had, that's a bit... disingenuous.
  - tptacek 14y ago
    The average HN user certainly doesn't have that capacity. Come on.
    - ThomPete 14y ago
      Now that's disingenuous. :) I am pretty sure you know what was meant.
- larrys 14y ago
  "Anyone who was a qualified buyer" What criteria did you use to determine a "qualified" buyer? As someone who frequently deals in transactions over the web for large dollar amounts it is not always clear who is qualified and who isn't. Especially if you aren't doing a high volume of transactions so you don't have a pattern established. One recent transaction we handled for someone started off with an insulting offer of $1000 (from a gmail type account in China (qq.com) and ended up at $38,000 USD)