How Do You Know If It’s The Right Time To Sell Your Bootstrapped SaaS?
Many entrepreneurs find it difficult to part ways with their SaaS, and it’s easy to understand why. If you have bootstrapped your business, this means you’ve invested your time, energy, finances, and other resources to build your SaaS from the ground up. In some cases, you may have even taken the time to invest in building a rock-solid team. Choosing to move onto the next project or focus on something else is never easy, which is why entrepreneurs must face the question: when is the right time to sell?
There isn’t a one-size-fits-all answer to that question. In short, the best time to sell your bootstrapped SaaS is when it is right for you. From our experience, we have found three factors that can trigger entrepreneurs to consider selling:
- The desire to focus on other projects. Many entrepreneurs have several projects that they are working on simultaneously, and in some cases, one project requires more attention to continue to grow.
- Hitting a growth plateau or risk ceiling. Many entrepreneurs may reach a point where they have achieved their growth goals and find it difficult to take their SaaS to a new level without incurring high levels of risk which may impact their financial future. At this point, selling may be a viable option.
- Changes in your personal life. Some entrepreneurs may have gotten to a point due to changes in their personal life such as (kids, marriage, or changing locations) where reducing financial risk or having more time to spend with the family may be the best option for them.
“Reaching our goals, although thrilling, shifted our risk level to an uncomfortable height where we suddenly felt that we had something to lose,” said Danielle Simpson, Co-Founder of FeedbackPanda. “I noticed that we were no longer making smart business decisions, but decisions rooted more in comfort and safety.”
There will never be a “perfect” time to sell, but if it’s the right time for you, that’s the most important thing. If you’re considering it, you’ll want to start thinking about what/who will be the best fit for your company and team so you can achieve your dream exit. You’ll also want to learn about the ins and outs of calculating the value of your SaaS. For more on that, when revenue-based valuations come into play, and the intangibles you should consider in any valuation (or sale), check out How To Value a Bootstrapped SaaS Company.