Gatlinburg TN Real Estate
My name is Annie Maloney and I am a resident of Sevierville Tennessee in East Tennessee
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SSL Certificates and Your Website
If you don't have an SSL certificate on your website, you need to change that. Once a nice-to-have, SSL certificates are now as necessary as having a URL. You can not, should not, and will not have a successful website without one. Althought Google led the way, other browsers are following suit: your site will be penalized severely without the proper security settings in place. Let's go through some of the most commonly asked questions about SSL certificates: Do I Need an SSL Certificate for my website? Yes. Absolutely. Oui. Sì. Shì. Ja. Ae. Yebo. Hai. An SSL certificate is way to tell both your website visitors and search engines that your site is safe, and secure. Without one, Google (and other search engines) will mark your site as unsafe, and will even go as far as devaluing your site, making it harder for it to be found organically, or even at all. Plus, as the site owner, it protects you too What Does a SSL Certificate do? These tiny little bits of code pack a powerful punch when it comes to web security. Their main purpose is to protect your website, your users, and you, by enabling an encrypted connection. Encryption really just makes information unreadable by anyone else but you and your customer. Think of encryption kind of like writing a letter: which you run through a machine that turns it into a secret code; which you place in a thick envelope; and hand it off to a covert, senior Brinks Guard; who drives it in an armoured truck to your recipient; who has to sign for it; proving their identity with a validated signature; they then run it through a secret message decoder that only they have; that only works for this one message; and if they don't read it in time, the letter self-destructs. That is SSL encryption, and a certificate does this all for you automically. Imagine if you had to do that on your own? Having an SSL certificate is important so your website visitors feel safe sharing information (from your lead capture forms), downloading from your site (even loading images on your site counts), and working with your business. How do I know if I already have an SSL certificate on my website Easy to check Step 1: Open your browser, and type in your website's URL. Step 2: See a lock beside your URL? Congratulations You have SSL installed. No lock? Time to get your own certificate. How do I get an SSL certificate? The easiest way to get a certificate is through you domain registrar (popular ones are GoDaddy, Bluehost, HostGator, and Domain.com). While Real Estate Webmasters does not sell them, we will install them on REW CRM backend websites, free of charge Ok, I Purchased an SSL Certificate, Now What? Let us know Once you have purchased your certificate, contact our Support Team. They will work directly with you to help get your certificate generated. After your SSL certificate is generated, our Support Team will take care of installing it on your site for you Get Secure Now Original Post, October 2017. SSL Certificates Google recently announced that it now gives a slight SEO boost to sites that utilize HTTPS encryption by default, with strongly implied plans to make this ranking signal even more important in the future. A ranking signal is essentially a factor within an algorithm, and search engines use hundreds of different ranking signals to determine exactly where each site deserves to rank. Search engines generally keep the specifics of these ranking signals under lock and key, until they want webmasters to mend current practices and improve user experience. Considering Google's very public announcement, it logically follows that SEO-savvy REALTORS® are going to want to get a little more secure What You Should Do Next... You can get a pretty good summary of what HTTPS is and does on Google's own Secure Your Site page, so I won't reiterate the same info that you can read there. Instead, let's move on to what you need to do to implement HTTPS on your own site: 1. Buy An SSL/TLS Certificate. We currently recommend DigiCert's SSL Plus or GoDaddy's $75 option. 2. Submit A Custom Work Order, via your product consultant. He or she will begin by getting an estimate for the implementation work, which you will then need to approve. Once we receive your work order, we'll get to work behind the scenes. We will walk you through the steps of verifying your certificate, then we'll add the certification to your server, update the htaccess for needed page-level redirects, use protocol relative URLs for all other domains and otherwise ensure everything is hooked up and functioning properly. After the programming and server updates have been made, we highly recommend investing some SEO time to do a few final checks and balances. If you opt in to the SEO time and have Google Webmaster Tools set up, we'll submit a Change of Address and new sitemaps, update the website information and do additional tests on the 301 redirects set up by programming. Important Considerations: -SSL certification must be renewed and updated annually, or every 2-3 years, depending on the option you choose to purchase. -If you choose not to renew your SSL certification, it is recommended that you revert your site to HTTP. Otherwise, users will receive an ominous warning message whenever they visit the site.-Sites with agent subdomains will require a Wildcard SSL Certificate in order to apply SSL to the subdomains. GoDaddy currently sells a Wildcard SSL Certificate for $291. Additional Benefits Of HTTPS Security When it comes to the benefits of getting SSL certification, SEO is really only the tip of the iceberg. The entire point behind HTTPS is to allow users to share information securely, without worry. The secure encryption on a certified site means that users can submit more sensitive information—like mortgage forms and job applications—right on your site, without worrying about their data falling into the wrong hands. Better still, your users will know you're taking care of them. Having a trusted SSL certificate builds confidence and lets people know you're going the extra mile to keep their information safe. This increased level of trust will build better relationships and make people more willing to fill out registration and other contact forms throughout the site. Updated August 22, 2014 at 16:18 PDT to add information on Wildcard certificates for agent subdomains. Updated October 31, 2017 at 14:21 PDT to reflect current SSL estimate process.
12/01/2019 05:00 PM
$50M REW Prop Tech Acquisition Plan
I’ve been in the prop tech space for 16 years. In this time, I’ve had the great pleasure of meeting some of the most creative, intelligent, inspiring entrepreneurs in the world. We have hustled shows together, we have learned together and we have grown together. In these 16 years I have been truly blessed to also have made some great friends. As we head into 2020 I find myself thinking: Wow it’s a new decade Can you believe it? For me it’s a special time. Personally, I have turned 40, my youngest is now a teenager, my oldest is 24. I have decided to focus on my health & personal wellness, my relationships & family (especially my marriage to my amazing wife) and I’ve found myself focused far more on what I can do to feel like I’ve done right by this world. What this means for me is trying to help more people (especially women and children at risk) and really giving thought to the legacy of our generation. Are we leaving this world in a better place than we received it? Are we leaving any kind of world for our children at all? Needless to say this makes me very motivated I realize that I need to do more, and I recognize the opportunity I have as a successful business person and influencer to have a real impact. It also means that I must act with intent & focus. It will take all my energy & resources and quite frankly I feel that we can and should be doing even more. On the professional side: 16 years And for whatever reason, be it luck, talent, timing (and of course we KNOW it is because of amazing team members and amazing customers) we have done incredibly well in our space. Better than most in fact. For a software & marketing company in prop tech we achieved what has rarely if ever been seen. - We have taken no outside funding (we still own 100 of REW) - 16 years straight (every year of our existence) we have been profitable. (That is unheard of for anyone in any software space) - We have made acquisitions, all of which have had positive ROI - Our subscription retention is nearly 90 - Our SAAS Revenue has growth every year - This year we will hit $150M In Aggregate Revenue In short, we have an exceptionally well run business with incredibly talented leaders and truly know what it takes to be successful in the real estate / prop tech space. The purpose of this article: So why am I sharing this so publicly? The answer is simple: we’re looking for companies to join us and so I’m sharing my plan. If you know me, you know I don’t do things in a traditional manner. My style is to put it out there, to not hold back and to go after what I want in a direct and purposeful manner. This post is meant to reach the prop tech companies that are potentially the right fit for us and give you enough information to start a conversation about potentially joining REW in our journey or selling me your company so that I can take it to the next level and provide a great home for your customers. So here’s what I’m looking for: The Plan. I am looking to acquire companies that are complementary to Real Estate Webmasters that can benefit from our scale and expertise. Over the next 3 years we are targeting companies with combined revenues of $20M Annually. Through business optimization, increased sales & marketing, access to our exceptional R & D talent and to our network of over 50,000 agents domestically and globally (which is growing rapidly) we intend to help these acquired companies grow by 2.5x What this means is we intend to convert this acquired revenue stream from $20M annually to $50M annually. Of course each company’s path will be different. Some companies have amazing products and are very new. Their revenue is low and thus their growth might be thousands of increase. In this case we’re the rocket fuel and guaranteeing the product succeeds. Some companies are more established but are stuck (they can’t grow but have loyal customer bases) access to our additional products, sales channels, marketing and customers will help here. And other companies, while they may have an established customer base, they are going the wrong way. For whatever reason (usually they cannot afford to innovate / stay competitive) it doesn’t look they are going to make it. Their churn is too high, they are shrinking (not growing) they have not been able to become profitable and their path to success is not clear. in this case our goal is to be a great home for their customers and move them into a better product. For the founders, it’s an opportunity to get “something” instead of riding it out to the bottom and closing up shop. Does this sound like you? Are you between $250k-$5M in annual revenue in the real estate technology space? Do you have an established base of realtors (agents, teams, brokers, franchises) as customers? Are you wanting to see your ideas, products, services or customers flourish and reach new heights? Do you you want to be a part of an amazing team and story? Or are you interested in existing and having your customers taken great care of? If so let’s talk I am extremely serious about this program and my goal is to close all deals in the next 24 months. We have the resources, talent, & access to funding needed to make this happen and if you’re in it for the long haul and willing to be creative, we can often accelerate your valuation significantly higher than it would be if you were to just sell today. Speaking of which, before you reach out, PLEASE read this article on multiples (especially if you have not done any of these deals in the past) https://www.realestatewebmasters.com/blog/post-ioi-real-tech-investing-my-thoughts-on-the-numbers/ you need to be realistic on the valuations of your company. The article will break it down for you. This post is for prop tech entrepreneurs. If you know someone who owns a prop tech company that might be a good candidate please encourage them to reach out and share this article.
11/30/2019 05:17 PM
The New Face of NorthropRealty.com
Real Estate Webmasters (REW) and their customer Northrop Realty are proud to announce the launch of the brand-new northroprealty.com—"leveling up" the benchmark for real estate websites everywhere. We are excited for this first class website reveal", shares Creig Northrop, President and CEO of Northrop Realty. "We are leveling up on what we have done in the past. You do not want to miss it Inspiration for the site design comes from both inside and outside the real estate industry. The result—a fresh, exciting, and totally new perspective on what a real estate site should deliver. "It is obvious from the moment you land on the homepage that this is a higher-level experience," says Tim Collins, REW Enterprise Sales Manager. "Every element has been crafted to provide an incredible user journey, showcasing a final product that Northrop can truly stand behind." REW and Northrop Realty worked closely on this fully customized site to strategically architect the user experience. REW led the creative process, allowing the industry's top developers and designers to reimagine the concept of what a luxury real estate website should be. The result is one of the most highly anticipated website launches in the history of the company. Beautiful Website Design Unique features for the website start right on the home page. You are first met with a beautifully curated collection of striking, full-height, and beautiful images that draw you in from the moment the page loads. The simple words "Find Home" fuel your excitement. Next you can navigate down the page to learn more about the featured properties, the local communities, and get an introduction to what their brokerage has to offer you. You can also see what people are saying about their services via a beautifully integrated carousel. "We've spent a lot of time working on this amazing luxury design, which we know people will love," adds Collins. "Our team is so excited to see it go live, because this sets a new standard what a real estate website should be." You can easily find and learn more about your areas of interest via Areas We Serve, getting instant access to the hottest listings, community profile and statistics, and a full, filterable list of all of that area's properties. Northrop Realty's website also offers an abundance of tips and guide home buyers and home sellers, and their gorgeously designed blog gives sites visitors the latest market information, with fresh and specialized posts. Leveling Up As A Real Estate Brokerage Last year, The Creig Northrop Team, the the 1 Real Estate Team in the nation*, transitioned to Northrop Realty, a full-service brokerage. This momentous step towards continued growth allows them to serve a broader market, open additional offices, and provide further advancement opportunities for its agents and teams. The new face of northroprealty.com also gives them opportunity to continue to grow their business, giving them a very special tool to continue to recruit the top agents in their market. "We are fired up about the transition to Northrop Realty and northroprealty.com," shares Morgan Carey, REW CEO. "It is a big move— we are ecstatic for the agents at Northrop, because not only will every agent get a super high-end website, but they are also getting a brand-new, state-of-the-art CRM." northrop.com is by a powerful CRM—all Northrop Realty agents will get access to the most powerful CRM in real estate with REW CRM. RelationshipsMatter "One of the best things about this project has been working with Northrop," Collins relates. "I truly admire how much they care and how passionate they are about their business. Their website is a reflection of that—a super high-quality product that is developed entirely around their clients, mission, and values." The relationship between Northrop Realty and REW is what truly lies underneath this incredible website project—through building trust and understanding of goals, together they have created on of the best websites in real estate. Realize your impact. Find a way to be different and do the right thing, always. - Creig Northrop, CEO, Northrop Realty
11/25/2019 01:05 PM
The 12 Days of Christmas Promotion is Back
It's our favourite time of year here at Real Estate Webmasters. Not only is it the holiday season, it's also a time to reflect on successes of the past year and a time to look forward to the year ahead. At REW, we've immensely grown our business over the years, but that doesn't mean it's time to take the foot off the gas. Looking ahead to 2020, REW is investing in our technology, people, and marketing more than ever before. Because that's what it takes to be an industry leader. And the same applies to you. Whether you're an agent, team, or broker—it's a great time to ask: "What am I doing to make 2020 MY YEAR? What am I doing to get ahead or to stay ahead in my extremely competitive market?" What is the 12 Days of Christmas Promotion? Every year, leading up to Christmas, Real Estate Webmasters holds the 12 Days of Christmas promotion. 12 Days of Christmas provides 12 incredible deals that help you take your real estate business to the next level. Whether you're a first-time window shopper or a long-term client, this is the absolute best time of year to upgrade your platform or purchase service hours before the end of the fiscal year. Why is this promo so awesome? Here are three reasons why this promo is so great: The best prices: These are some our best prices of the year, don't miss your chance at an incredible deal. The most choice: You get to choose which of the 12 deals is best for you. The best timing: By getting in now, you can have your site up and ready to go well before the busiest time in your market, spending your budget before the new year. Be smart—get those marketing expenses in before the end of the year.Get your favourite offer before it's gone What are this year's 12 Days offers? This year's deals are bigger and better than ever before. Agents can save thousands and brokers can save hundreds of thousands Looking for a real estate website? Check out the amazing deals below Ready to up your game in 2020? Up your game with one of our branding offers, marketing offers, or the exclusive enterprise offer Here's a rapid-fire look at what we're offering this year: 1. 50 OFF Website Setup and 10 hours FREE of professional services. Whoa, 2020 is suddenly looking a lot brighter. Available for REW Launch 2. FREE Website Setup on Semi Custom and 100 hours of professional services You get the best real estate website without even lifting a finger. Available for REW Semi Custom 3. 50 Hours of Content Transfer Time Leave the heavy lifting to us—plus 10 hours of professional services Available for REW Launch 4. FREE Backend Audit WITH 10 hours of professional services. It's time that you know what you've been missing all this time. Available for REW Launch 5. Donate Your Website Setup Fee Help our community and get some love back. Donate your set-up fees to anyone of the chosen charities and will promote it AND give you 10 hours of professional services Available for REW Launch 6. FREE SEO Audit and Recommendations Ready to boost your search rankings and connect better with leads? We'll provide a free SEO Expert Audit and lay out what you need to dominate your market. Available for REW Launch 7. FREE PPC for a Whole Year This deal will sell out fast. We will cover your PPC management fees so you can watch your ROI soar. PLUS 10 hours of professional services. Available for REW Launch 8. FREE Logo and Brand Guide You deserve branding that is uniquely YOU. Let our team of expert designers guide you into 2020 with branding that will help you stand out. Available for REW Launch 9. FREE VIDEO and All Expenses Paid* Trip to Vancouver Island. Our most exclusive offer, and one that our customers love. Get an exclusive video with a leading real estate videographer, AND your *hotel and airfare covered for a trip to the beautiful Vancovuer Island By invitation only Check these videos out from one of our amazing clients, The Funk Collection: 10. 25 OFF Full Branding Package Dominate your market with the best real estate branding available. Get a brand you (and your clients) love. For current and new customers 11. 25 Off Professional Service Bundled Discounts This is already the most popular deal. Get it quick before our schedule fills up. Make 2020 the year you shine Save 5 on Modules, 10 PPC, and 10 SEO 12. Enterprise Exclusive Blow your competition out of the water Double your users or get a massive professional services credit. For Enterprise Orders Only --- So there you have it. I know it won't be an easy choice, but happy shopping Get Exclusive Access Now *Terms and Conditions Apply. New website purchase and a minimum 36-month contract is required for website offers. Offers tied to specific programs (REW Launch, REW Semi Custom, REW Enterprise) speak to account manager for details..
11/18/2019 12:15 PM
How to use an IDX app in your leads workflow
IDX apps are a powerful tool for your business. They can help engage potential and existing clients, improve brand loyalty, and get people addicted to your services. But to get the most benefit, you need to know when to promote your app and how to use it within your existing workflow. Timing is everything. Typical journey of buyers & sellers First, let's talk real quick about the basic digital journey that almost every buyer and seller takes: 1. Search online When someone decides to buy or sell a house, they tend to start in one of two places: referrals or web searches. In either scenario, the person is trying to find more information about the real estate process. People who don't want to start with an agent will search terms like "Vancouver real estate" in search engines to see what comes up. Likewise, we know from our real estate market research that buyers and sellers vet real estate agents online as the next step after they've received a referral. This means that regardless of whether someone starts their search on the internet or through friends, they're going to be browsing the web next. 2. Website discovery Once a potential client finds your website, they're going to look around. They will probably check out your home page, click on a few listings, and hover on your navigation. If the buyer or seller likes what they see, they'll explore further. It typically goes one of two ways from here. Either the user registers on the site and becomes a lead, triggering your lead follow-up process. Or they don't find what they're looking for and leave the site, likely forever. Here's where your app first comes into play. If you're one of the few Realtors who is differentiating themselves with an app, you can give your users a third option: download and install your app. Realtors should use their websites to promote their apps—especially to people on mobile devices. Apps create a better user experience and, if potential buyers download your app, the likelihood they'll become clients is much stronger. 3. App discovery If you managed to successfully get your website visitors onto your app, give yourself a high five. More than 70 of active app users on REW-built apps visit the site at least three times per week. That's a pretty powerful statistic because it indicates that users are hooked on the apps. Getting people to install your app is the single biggest hurdle in the entire process but it's a critical step for your app's success. Do everything you can to get people to try your app Once they do, you may very well have new customers for life. 4. App engagement This is where the magic starts to happen. Once someone downloads your app, they're going to try it out. If they like what they see and find what they're looking for, they're going to be hooked. The best part about real estate apps is they're focused on exactly what buyers want: homes. Push notifications and alerts remind visitors to come back to the app, and—if your app is through REW—all the homes viewed in the app will be recorded in your CRM. How to naturally promote your app If anyone contacts you or indicates they are searching for homes in any manner, the next step should be to recommend your app. Send them your link and let them know how the app will help them achieve their goals. But just in case they don't contact you, you'll want to make the app an obvious option on your website too. There's a very limited window of opportunity to get users on your app and your goal is to make it as easy as possible to find and download your app. Here are a few ways you can promote your app through your website: Intercept ads - particularly those that detect mobile devices Download buttons in visible locations on the website On the "thank you" page of any form In the auto-email received after a form submission Using app data to convert leads into clients The final piece of the app puzzle is converting those app leads into actual clients. If you use an app that automatically syncs data with your lead management platform, like our branded IDX apps do with REW CRM, you can use your existing action plans and follow-up procedures. Within the CRM, you'll be able to see exactly which properties your leads interacted with, as well as their saved searches and historical activity. Use this information to get in touch, foster meaningful connections and deliver additional info that's of value. Even just a, "Hey, I saw you looking at 246 Chesterman on my app. It's a gorgeous property. Want to check it out?" will go a long way in building new relationships. At the end of the day, your app is another way to help people find information and get clients engaged with your brand. In return, their data will provide you with invaluable insights that you can couple with your follow-up strategy and use to transform those leads into clients.
10/31/2019 02:15 PM
Real Estate Webmasters: International Expansion Starts in Europe
Real Estate Webmasters signs RE/MAX Europe Mallorca, Spain | October 21, 2019This month, Real Estate Webmasters (REW) reaches another milestone by signing their first major international enterprise client, RE/MAX Europe. "We are very excited to announce that we have officially signed RE/MAX Europe," Morgan Carey, REW CEO, announced to employees and strategic partners today. This international collaboration will start with a complete redesign of RE/MAX Europe's remax.eu, their franchise website. "Our first goal is to help drive franchise sales, and broker agent recruiting for the Regions. Our job is to accelerate their already tremendous momentum," Carey asserts. "We will continue to advance the best real estate brand in Europe, assisting with the massive expansion of RE/MAX Europe." "We are eager to showcase inspiring videos and bring to light the awesome corporate culture at RE/MAX Europe, featuring their incredible wins and innovation. Our expertise in digital storytelling will really highlight the amazing things that RE/MAX Europe is doing for the entire industry." In a special video message to the REW team, Michael Polzler, CEO of RE/MAX Europe, shares his enthusiasm: "I am so excited to be working with all of you on our new platform for RE/MAX of Europe. The opportunity is HUGE—what I love about working with Morgan is his passion for change. He sees the opportunity, and together, we are going to change the way real estate is done in Europe." RE/MAX Europe has been taking the real estate industry by storm, setting an unprecedented rate of expansion in the European markets. Leading the reimagination of the current bespoke system, they are replacing archaic practices with more modern and efficient ones, modeled after the hugely successful customer-focused North American models. REW is a leader is a known leader and innovator in real estate technology space, producing award-winning websites for agents across North America. This success has garnered the attention of real estate professionals across the globe. As the two companies work together on moving their current website over to the modern REW platform, REW and RE/MAX Europe will continue to collaborate as champions for change in the European markets. ENDS
10/21/2019 08:43 PM
Failing prop tech companies. You’re not going to make it. Now what?
Ever since my post iOi article I have received a lot of interest from companies and founders asking me to give feedback on, evaluate or acquire their businesses. Some really awesome people with great vision and a love for prop tech just the kind of people I love spending time with. There are also some really exciting companies that are growing, have a great customer base, have not over leveraged debt, are at or near profitability and have a unique product set that could really benefit REW and our customers. I’m extra excited about the potential to have some of these companies and their people join REW. We’re being super picky about where we put our resources (time and investment funds) but I think in 2020 you’ll see some great new additions to the REW family. But those aren’t the companies I want to address today. What about the ones who are clearly not going to make it. Sadly many of the companies that reach out to me do not appear that they can stay in business. Here is the typical formula I see: Founder has lots of enthusiasm for the idea and has not given up on “hitting it big” and wants to get an investor or sell for a multiple of revenue. Growth appeared strong in the beginning through the “early years” Company has sales ($500k-$5M in ARR) but has never made a profit and is in massive debt. Pricing strategy is all wrong (typically too low) hence the lack of profit with no ability to increase and keep customers. No more funding available: Investors / lenders realize the company has overspent and does not have a viable model and are going broke (some now want their $ back) The product already exists and is not innovative or competitive with already established options. They can’t afford to change the product now and clearly run out of time. Assessing the situation 2 types of founders: Dreamers and the caring Realists All the folks I speak to are truly unique, but there tend to be 2 types of founders when it comes to assessing the situation. Dreamers: The conversation goes like this: If I just had more money, more time or the right partner, I would make this thing work These folks are hard to deal with, because often times no matter what you say to them, they are so dead set on winning, that they can’t recognize that they have already lost. This is going to be hard for them to read, but I do hope they do. 1: If you can’t do it small and right, then you can’t do it big and right. Not one person is ever going to invest in your failed model that clearly isn’t working. Either your product is wrong, your go to market is wrong, or you are not the person to be running this kind of company. It doesn’t really matter though. If you fail small, you will crash and burn at scale. It gets WAY harder. 2: A different company / founder that is more successful will make this work. So I want them to take over and be a part of it and get rich. If the problem is actually not the product but it is actually the founder or the go to market this is actually possibly true. But here is the thing about this situation, if someone else is going to create the value in the company post acquisition you cannot sell that value back to them. What "they" can achieve after buying your company literally has nothing to do with you. So all you have is a product (and likely one that already exists or is not that expensive to create) so given the amount of risk involved in acquisitions, the time it takes to transition customers etc there is really zero value in the company. No one is going to pay you for it. Their money is better spent on their own, already profitable company that carries no risk and does not need to deviate from their model and deal with the hassle of an acquisition. 3: My company is worth “x” multiple because much bigger companies are worth “x” multiple. Nope Small, not profitable companies don’t get multiples of revenue. Sorry. They don’t get multiples of EBITDA either (that wouldn’t even make any sense, since there is negative EBITDA). 4: But I have all this revenue Top line revenue attached to a fundamentally flawed business model where you had to spend $3 to make $1 makes absolutely no sense. It’s a failed company. Sure you might have started with lots of funding (perhaps in the millions) but if you spent $3M and only made $1M that is even worse. Revenue alone means nothing to a companies valuation. It is an asset (I’ll talk about it that later) but you cannot sell people revenue as if it were amazon stock. You’ll get pennies on the dollar if you’re lucky. The person buying has to turn this around and clearly that is not going to be easy. I have a hard time with the dreamers. Admittedly I get frustrated with their inability to assess their situation when the cold hard facts are staring them in the face. I “hope” that a bit of tough love and a dose of truth can help them go from dreamers to realists, but I fear for most, they will choose to crash and burn (and get nothing back for their investors or themselves) because they could not look at their situation objectively. The Caring Realist: On the other side are the caring realists. They have gotten here in much the same way, but they realize the dire nature of their situation and they need help. I call them realists because these folks aren’t trying to get rich or expecting someone else to fix their broken company. They get it. They tried. They failed. They are in debt. Now what? I call them caring realists because they also have another set of characteristics. What about my customers? These founders have sold all these customers on their dream. The customers are relying on them to continue to deliver a product to them, often times the customer has put a lot of time, effort and money into the product and it’s going to be really hard on them to have to switch. A lot of time, cost and frustration. The caring realist knows this, and they really want to find a way to help their customer in any way they can. What about my people? These founders have employees. People that believe in them and have often times sacrificed many years at lower pay than they might have gotten elsewhere in order to help realize the founders dream. They love the customers, are proud of the product. The caring realist loves their people and wants to do right by them. This is the best quality of the caring realist. Bless you for this What about my investors? Often times with small companies the investors are small too. Maybe even friends and family. The reality is if the company goes under (and it is going to) these people will lose all of their money. It is the risk that investors make (they are betting big on a gamble for a big reward) but the reality is it sucks when you lose all of someone else’s money. The caring realist knows that it was them that convinced them to invest and feels obligated to help return as much value to the investors as possible. Being a realist they also know it will not be anywhere near the amount invested. I’m one of these companies, what do I do now? The way I see it, there are really 4 options for you. Taking any one of them means giving up on your dream and accepting that you did not realize the goals you had set out for yourself, but 3 of the 4 allow you to extract some value in most situations. Wind down / Profit extraction: You have customers and a product they are paying for, so there is revenue there. You also probably have a ton of costs causing you to not be profitable. If you choose the wind down / profit extraction option this basically means shedding all possible costs in order to extract profit where there was none before. For example, if you are winding down you likely will not be investing any more into the product, and thus you can get rid of your developers, your designers and their management. You are probably not going to be actively selling the product any more (that would be very wrong) and thus your sales and marketing staff can go. Since you’re extracting profit, you will also likely reduce even necessary staff to the bare minimum needed to keep the product on life support. This “can” (and most of the time does) allow you to extract “some” value. But it really is not a fun process. Here’s a few things to consider when thinking about winding down: Your customers will ALWAYS leave you much faster than you think. Once the product and service starts to dip they are gone. Don’t count on a large group of them sticking around for a long time. Your staff are going to leave too. I’m talking the ones you thought you might keep to support the product. They know what’s going on. The moment they see you winding down the company they will start looking for jobs (if they have’t already) and they should. They owe you nothing at this point and have to look out for themselves. Your personal reputation is going to take a hit. People are going to write nasty reviews about you (both employees and staff) this model is seen as the most selfish of models and can feel very personal. You have to see these people online or on the streets and you have to be able to live with how you chose to handle the shut down of your company. You can mitigate somewhat by being as honest and transparent as possible but it’s still going to be a negative. Buyout Company: There are lots of these (take constellation for example). These companies are looking for great deals. They want to buy your company, optimize it in many ways in order to turn into a profitable company and extract value for their shareholders. What it generally means though is that you are going to get extremely low cash offers. You might have $2M in revenue and get an offer of $250,000 for you company (and rightly so your company isn’t worth anything, it’s failing). As for your people and customers. There is no protection for them. These companies can (and often do) come in and get rid of your entire team (they have far more experienced teams that handle these types of platforms) and can often times increase the price quickly without any new product offering or innovation. It’s a slow death for most acquired companies as customers leave and the buyout firm extracts their profits. It’s the least amount of cash of the 4 options, but it is an option. Earn out partner: This is where REW generally plays. Earn out partners are strategic in nature and partner with you to maximize the potential profits for themselves, but also in doing so maximize your potential extraction for yourself and your investors. Why is called an earn out? Because you are not being paid cash up front for your company. Your earn out partner (let’s say in this case REW) has to invest significantly up front in creating a transition and retention strategy in order to make the acquisition make sense. So the earn out partner is investing $, they are just not giving it to you up front. The way I look at these deals goes something like this: Spend 6 months post acquisition ensuring the customers are going to be transitioned and taken care of the right way. Give the staff ample time and notice to find new jobs OR if they are great and their skill set is needed, we may be able to offer them a new, more stable job. Create a strategy that “adds value” to the customer. Convince them that by being acquired the product is going to be replaced with something better. Give them special pricing and incentives to move and commit to a term. Treat the customers with extra love and provide extra support taking care of as much of the migration and hassle as possible. Help them understand that the transition was an alternative to shutting down and that you found the best possible partner for the customers. Over the next 3 years or less we work together to transition the customers to REW. Not going to lie, 25-50 of them will be gone in the end. This process is disruptive and we cannot force customers to participate in your earn out (especially if they are not contracted) But let’s say 70 on average stay. What might that look like on an earn out? Here is some complete hypothetical math (note every deal is different, please do not ask for this math I’m just using easy numbers to calculate they don’t represent actual numbers) Let’s say you had the following: 1,000 customers $200 per month per customer $2.4M ARR Average customer retention after 3 years 70 50 earn out on profit $200 profit per customer per month after transition So the math here is quite easy: The “average” customer number over the 3 years is 70 or 700 customers. 50 of the profit at $200 per month per customer is $70,000 per month Over a 36 month term would net you $2,520,000 in this scenario. These are funds you could use to pay back your investors or if you do not have any, these are funds you get to keep. Fundamentally you end up selling a zero profit company worth nothing in this fictitious scenario for $2.5 million dollars. And of course the last option: Fail / Go Bankrupt: This is an obvious outcome if you do not choose a different option. Everyone loses in this scenario. Conclusion: Obviously I’m partial to the earn out model because that is the space we play and it mitigates the risk on our side while maximizing the potential final sale price on the seller side. But different people have different needs at different times. Sometimes you’re just done, don’t have that much debt and want to walk away. you might look at a buyout (we do those too, but we like a buyout firm in that scenario) Sometimes you’re just stubborn and are convinced you’re going to make it. If you're a dreamer: My advise is read the article again. If you're a Caring Realist I’m on a 7 hour flight from Lisbon to Toronto, if you want to reach out and have a conversation about anything in this article feel free to hit my up on FB chat or send me an email. I love talking about this stuff and I’m always happy to help or give advice where I can. I can’t promise to save your company, but I will give you the best advise I can. Morgan
09/28/2019 07:03 PM