People are funny, but they're also stooooooopid.
I operate a certain kind of web service. It's not a huge market, but I have a modest piece of it. Recently, one of my competitors decided he wanted to go out of business and he approached me to see if I wanted to buy his operation. It's a service similar to mine, only (to be blunt) not as good. It's not kept current, it's built on some shaky technology, and all in all it's just not that great. I don't view his business as any kind of threat or real competition- he's just another player, albeit a lesser one.
But he's interested in getting out of the business and asked if I'd be interested in buying it. Keep in mind that the global market for this kind of service is not very big, it's a niche market and there's not a huge amount of money floating around in it.
I said, sure, I'd be interested in looking in to it, and I asked him a couple of basic questions to help me gauge its worth (i.e. what would I be willing to pay for it). I asked him:
1) Can you tell me roughly how many active users you currently have?
2) Can you tell me roughly what the yearly revenue is? I don't want a
specific figure unless you're willing to share that; a rough idea of the
yearly revenue would be all I'd need for now.
He wrote back:
"
I will not disclose any financial or client info. <name of company>.com is the first out there and, still, the only truly personal progam available. 'nuf said. If you are interested, let me know."
WTF??? He won't tell me how many clients or customers he has, and he won't even give me a hint of the revenue (if any!) that the company generates? Would YOU enter into a deal like that? Hell no! But wait, it gets better....
I'd estimate a realistic price for his operation at somewhere between $10K and (
maybe) $25K. If there was a lot of revenue generated, maybe more, but it's unlikely. So I had considered that somewhere around $20K might be reasonable. Maybe.
If I knew what it earned, but I don't, so it's an absolute no-go. I lost all interest right there, *boom*.
I said it got better, right?
I hope you're sitting down. He emailed me and told me that the "opening bid" for his company starts at "$1.5
million".
[font style="background-color: rgb(255, 255, 0);" size="5"]
LOL!![/font]
The
entire market isn't worth that, and no one who would conceivably be interested in buying his company would have $1.5 million dollars in cash laying around.
He's insane. It's probably not worth even 1/100th of that.
Nobody, and I mean NOBODY would value the company at anywhere near that much.
So, to recap, he wants me to give him $1.5 million dollars for his lame-ass company, but I'm not allowed to know how many customers he has AND I'm not allowed to know what kind of money it makes. Not even a hint, not even a ballpark figure.
Where do I sign?? lolololol!!
I spoke to a couple of people who are in the same kind of business/service, and they all just laughed. We ALL laughed. I can't wait to see what happens next.
Honestly, my mind boggles at the whole thing. I guess I was supposed to write a check for 1.5 mil and not quibble about details like clients or earnings or whatever. (As if I could actually write a check for 1.5 million dollars...LOL!)
