3 Lessons for Selling a $10 Million Business

A few years ago, our client Clickability was acquired for $10 Million by Limelight Networks (NSDQ: LLNW).

Now, if you’re like most entrepreneurs, I have a good sense of what you’re thinking right now, which is: “well that’s cool for them, but how do I get a $10 million payday?”

Great question. So, let me answer it, and along the way give some lessons from Clickability.

The first lesson is that Clickability was not founded just yesterday and has evolved quite a bit since it first launched. When the company first launched several years ago, it offered simple tools for web publishers that allowed users to more easily print pages and email them to friends among other things (we take these functionalities for granted today, but several years ago, this wasn’t as common).

Importantly, Clickability’s founders and team were smart enough to evolve their products and business model over time in response to market demand.

So, the key lesson, which is commonly repeated, is that your business ideas and products MUST evolve over time. The key is to launch whatever concept you have, and let market feedback drive its evolution.

The second lesson is that Clickability raised venture capital to support its growth. Without venture capital, the company would have ran out of money several years ago. But having the money on hand allowed the team to invest in developing new products and evolving the company.

The third lesson is that Clickability developed a product that was complimentary to another product. Specifically, last year Limelight Networks acquired a video platform business called Delve Networks.

Limelight felt that Clickability’s web content management system, when integrated with Delve’s solution, would make it a better product. Also, Clickability brought several high profile publishers (e.g., StarTribune.com, Philly.com, etc.) to the table, which could now become Delve clients too.

To reiterate this lesson, you should think about what assets you can develop that would have significant value to an acquirer (in Clickability’s case, these assets were its client list and technology).

A $10 million acquisition (or more) is easily within reach of lots of entrepreneurs. Just make sure you 1) get your product into the market, 2) have enough money on hand to allow for development, testing and evolution of your offerings, and 3) make sure you are building assets for which other companies would pay dearly.

 

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3 Lessons for Selling a $10 Million Business
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