Looking Smaller to Make Your Company Bigger

Built To Sell Radio Episode #360

In 2008, Gavin Hammar started Sendible, a platform that allows companies to manage all their social media accounts from one place.

The company grew steadily until 2016, when Hammar hit a sales plateau. Challenged to combat a high churn rate, Hammar took several unique steps to humanize his business.

Becoming a more approachable brand worked.


Sales increased by 30% year-over-year and by 2021, Sendible had 47 employees when they were approached by ASG with an acquisition offer Hammar couldn’t refuse.


In this episode, you’ll learn how to:

  • Humanize your business without becoming a bottleneck.

  • Bootstrap a seven-figure company while keeping 100% of your equity.

  • Create a white labeling program (without losing control of your brand).

  • Slash your churn rate by implementing one simple tactic.

  • Turn customer feedback into online reviews using an elegant approach.

  • Avoid a common mistake a lot of founders make at the LOI stage.

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More About Gavin Hammar

Founder & former CEO @Sendible (acquired in 2021). Now building StoryPrompt to help small businesses connect face-to-face with the communities they serve at scale.


Definitions

Earn-out: Earnout or earn-out refers to a pricing structure in mergers and acquisitions where the sellers must “earn” part of the purchase price based on the performance of the business following the acquisition. Source.


Due-Diligence: Due diligence is an investigation, audit, or review performed to confirm facts or details of a matter under consideration. In the financial world, due diligence requires an examination of financial records before entering into a proposed transaction with another party. Source.


Churn: Churn is a measurement of the percentage of accounts that cancel or choose not to renew their subscriptions. A high churn rate can negatively impact Monthly Recurring Revenue (MRR) and can also indicate dissatisfaction with a product or service.

Churn is the measure of how many customers stop using a product. This can be measured based on actual usage or failure to renew (when the product is sold using a subscription model). Often evaluated for a specific period of time, there can be a monthly, quarterly, or annual churn rate. Source.


Letter of Intent (LOI): A letter of intent (LOI) is a document declaring the preliminary commitment of one party to do business with another. The letter outlines the chief terms of a prospective deal. Commonly used in major business transactions, LOIs are similar in content to term sheets. One major difference between the two, though, is that LOIs are presented in letter formats, while term sheets are listicle in nature. Source.


Net promoter score (NPS) is a widely used market research metric that is based on a single survey question asking respondents to rate the likelihood that they would recommend a company, product, or service to a friend or colleague. The NPS is a proprietary instrument developed by Fred Reichheld, who owns the registered NPS trademark in conjunction with Bain & Company and Satmetrix. Its popularity and broad use have been attributed to its simplicity and transparent methodology. Source.


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