Selling 20 Companies at 4x ARR | Stuart Faught's Insights
About This Episode
Broadly speaking, there are two ways to build a company. Some entrepreneurs swing for the fences, spending decades building one big business.
Others play for singles, building a series of smaller companies they can sell and repeat.
Stuart Faught has made a career of the second approach.
He has started and sold 20 software businesses, making him the number-one seller on Acquire.com.
His model is deliberately small: build a simple tool for a niche of local businesses, grow it to $50K to $100K in annual recurring revenue, sell it for four to five times that, and move on to the next one.
In this episode, you’ll discover how to:
Structure a payment schedule that ends within 90 days, and why the one deal Stuart stretched over two years is the one he never got paid for.
Turn consultants who already have your customers’ trust into a sales channel, using two simple criteria to qualify them.
Spot the three buyer behaviors that make Stuart walk away from a deal, even when there’s no other buyer.
Use an in-person training commitment to win a buyer over competing sellers.
Put a $55K price on a company that doesn’t have a single customer.
Invest in your brand and sales deck before listing, and why most sellers neglect the first thing buyers see.
Make yourself part of the value proposition by showing buyers you’ll be easy to work with after the sale.
About the Guest
Stuart Faught
Stuart Faught is a serial entrepreneur who has built, bought, and sold more than 20 software businesses. He specializes in small, profitable vertical SaaS companies, serving niche markets ranging from dental and orthodontics to HVAC, med spas, and home care.
One of the most prolific sellers on Acquire.com, Stuart has developed a repeatable approach to finding opportunities, building transferable businesses, and successfully exiting them.
Today, he continues to build and acquire companies while sharing what he has learned from more than 20 deals.
Definition of Terms
Letter of Intent (LOI): This document outlines the basic terms and conditions of a deal before a formal agreement is drawn up. It serves as a mutual commitment between the buyer and the seller to move forward with the transaction on the agreed-upon terms.
Due-Diligence: This is a comprehensive appraisal of a business or investment undertaken before a merger, acquisition, or investment. It seeks to validate the information provided and uncover any potential risks or liabilities.
Earn-out: This is a financing arrangement for the purchase of a business, where the seller must meet certain performance goals before receiving the full purchase price. It reduces the buyer’s risk and aligns the interests of both parties post-acquisition.
Every business owner wonders,
“Am I doing the right things for the future?”
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