Mike Bloom

investor/operator/lifelong learner. reality has a surprising amount of detail

[Mike Bloom @ItsMikeBloom]

@jonchu Totally agree - worst part is many of them don’t understand what they’re signing up for. Education critical, don’t want these ppl to have to learn the hard way

[Mike Bloom @ItsMikeBloom]

Seller has now come back offering a reduced price as the “other buyer” had his funding fall through

Now offering ~15% discounted price but still needs 90% cash at close

Also disclosing that my concern about a one-off $300k rev was actually $850k (!) rev

All trust out the window

[Mike Bloom @ItsMikeBloom]

LOI #6: Provisionally "accepted", but now 24 hours later its dead 😂

Niche industrial manufacturer, extremely capital-light with very large captive install base. Pros:
- biz been around since 2004, when it was spun out of major industrial conglomerate
- signif room for growth (no sales team, marketing, manufacturers reps)
- seller needing cash quickly for legit personal reason and happy to take on larger seller note
- very close geo proximity

Offered up to $2.75m of total consid, equiv to 3x SDE, structured as follows:

- $1.5m cash at closing
- $750k seller note (or option to roll some as equity instead)
- 12 month $500k holdback, contingent on typical transition items (customer intros, suppliers, 12 month consulting agreement)

Seller responds saying yes, he wants to go with me, but needs $2.25m cash at closing, $500k seller note, no contingent payment, 3 month transition only. Says this "better balances the risks for both parties". I try to align incentives so that any deal is win-win for buyer and seller, but this is clearly not that.

Several other aspects of the negotiation have reduced my trust here in the counterparty, so I am politely walking away

Would welcome all feedback/thoughts/tips here on structuring! The search continues...

[Mike Bloom @ItsMikeBloom]

Do we think that Jensen looks at his phone and sees that he has 1M twitter followers already and thinks ‘cool!’ Or nah

[Mike Bloom @ItsMikeBloom]

-- alec lipowitz -- voltaire -- michael scott

https://t.co/ptU7Cz84KZ

[Mike Bloom @ItsMikeBloom]

uncertainty is challenging, but certainty is absurd

[Mike Bloom @ItsMikeBloom]

@JD_DeYonker agree w/ @sourcesandmuses on the union piece, IUEC in partic is no joke and more specialized than many other trades makes labor element tough

still great bizs, but reflected in multiples. I like what $APG have done in the space putting it alongside fire safety

[Mike Bloom @ItsMikeBloom]

best sales guy i know (after @rvmie_ ) sent me this today

"you can make it so complicated as to be impossible or you can simply walk up and hit the ball"

[Tech Sales Guy @TechSalesGuy]

best sales advice I’ve read in a while

[Mike Bloom @ItsMikeBloom]

@thespencerwalsh Tempting analogy

Does $UBER have the mkt share and thus economics that $DASH has?

Is $UBER significantly under-earning in food like $DASH is?

Is Uber run by the founding team like $DASH is?

[Mike Bloom @ItsMikeBloom]

@rvmie_ You got enough coconut water?

[Mike Bloom @ItsMikeBloom]

@nikitabier You've massively upgraded this place. Kudos!

[Mike Bloom @ItsMikeBloom]

@rvmie_ do it!

[Mike Bloom @ItsMikeBloom]

Leaning in heavily on off-market outreach. Paths I’m chasing down:
- vertical specific list building, lead scoring and then cold email/direct mail
- buy side firms w/ success fees
- in-person meetings and industry conferences
- twitter 😂

Anything else I’m missing? Please DM for any tips/feedback

[Mike Bloom @ItsMikeBloom]

It is certainly hard! Who knows if it will work for me, but clearly others have done it. Having worked at HFs and startups, when I look at risk adjusted, post tax profit dollar potential and consider life choices (agency, fulfillment, compounding) it feels like the best option. Nothing is easy. Structure of deal matters a ton too

[Mike Bloom @ItsMikeBloom]

@guessworkinvest Wow, sounds awesome if no catch, would be very interested to see how you go with this!

[Mike Bloom @ItsMikeBloom]

@robbiehendricks DM'd you - appreciate it and looking forward to it!

[Mike Bloom @ItsMikeBloom]

@MrNoahStern excited to follow along!

[Mike Bloom @ItsMikeBloom]

@deedydas @chamath Yes. 😂😂😂

[Mike Bloom @ItsMikeBloom]

@OnodaCapital 1/ technically fair, but that sucks and LPs aren't dumb
2/ my understanding was signif lower, which also gels with the leverage levels that've been reported

[Mike Bloom @ItsMikeBloom]

@jasonlk kahneman's inside/outside view is always a great lens

inside view, i agree w your takeaway

but outside view: what % of software cos in history have sustained growth at >$500m scale to justify the val that investors paid here in later rounds?