

Ask HN: Planning on selling statup, what do you think it is worth? - youngdev

Hello Fellow HN,<p>Last year myself and two other partners got together to work on our startup. We got an offer from one of the YC competitors for 40K seed money. We turned down the offer because one of the founder was expecting a baby 2 months later and one founder was in process of re-location.<p>Fast-forwarding to today, we kept on working on the idea and bootstrapped it. We all are making 100K plus salaries so did not feel the need to quit our jobs for 40K.<p>We are at the stage where we now think that it is better to spin off the startup as we can no longer contribute our time to it due to personal commitments.<p>What do you think something is worth which had 40K seed offer and has a working product?<p>Note: we have not launched the application yet to public. It was only shared with Friends and family and few investors and got good feedback.
======
bap
My instinct (knowing nothing about your business or it's potential) is to
launch but maybe you have legal or financial or personal reasons for not doing
so.

There's a potential problem of perception from a buyers perspective:

The buyer is getting an unlaunched, friends & family market tested batch of
code. Further, it is apparently something the founders don't believe in enough
to take a chance on. (big red flag.) I'm not saying it doesn't have value, I
know all about life choices and timing (spouses, kids, mortgages, car
payments.) You just have to be aware of what you may be communicating to a
potential buyer.

If they were planning on building it they might buy it but if they can build
it for less, they might just do that.

 _I would be very tempted to launch it_ and see if I could get some traction.
It's going to be worth much more if you can get some adoption. Yes this is
riskier, if it flops out of the gate it might be worth less, realized than it
was when it was all potential energy.

When it comes to the $40k: was the seed offer about the product or the team?
Very commonly in seed people are betting on the team as much as the product.

Can you find someone to take over and execute on the product but leave you and
your partners in the equity mix? This is risky too, you might get washed out
but it's an alternative if you can't sell it. Some return may be better than
none.

Can you sell your codebase to a potential acquirer? What large company would
benefit most from having this product in their offering? Could you sell it to
a potential incumbent who hasn't innovated in a long time and is suffering
from stagnation? It might be cheaper to buy it than for them to pay to have it
built. Essentially a contracting gig on spec?

~~~
youngdev
We are not selling it for money. We are selling it so we can see our idea
taken to the next level. Ofcourse, in the process we would like to make our
invest back. We are thinking to let it go for the money we have put in it
(which is not a whole lot) and not seek any additional profits.

------
MarlonPro
The offer was just last year. You probably can go back to the table with them
to talk about the offer they made and if they're still interested.

Or, shop around, which is time-consuming. If there are multiple offers, it's
up to your group to decide.

Or, this may not the option you're looking for but, i think, this is your BEST
option....

SHIP IT!

Only then you'll know how much it's actually worth. Look for ways to manage it
- outsource the management of the product if it needs some backend support.
Maybe find another co-founder who has the time to run the product.

~~~
youngdev
I like the idea of finding another co-founder who can take the lead and run
with it. We can provide some back-end support as needed.

------
AznHisoka
Just ship the darn thing. Any money you receive from selling won't be life
changing, and will help you out in the short term. Also, it sounds like you're
pretty much done with the product development - marketing is important but
it's less time consuming, and less stressful than the actual development. Go
for the home-run.

------
staunch
Nothing probably. Very few people want to buy a pile of code with no users,
revenue, or team to go with it.

------
pavlov
How do you plan to find a buyer? The price is probably going to be quite
different if you put it on eBay and hope for the best, versus if you have some
networks where you can market it privately.

~~~
youngdev
We haven't though about that part yet. I think there is a site called
Flippa.com but seems like that site is sell site which have ad revenue or
customer. So not sure yet.

