Creating value before exiting

Welcome back to another edition of The Wise Exit!

In today’s newsletter: 

• 3 lessons from Aaron Patzer about his exit from Mint.com 💻

• A brand new episode of the Cashing Out podcast 🎧

• Our round-up of interesting M&A transactions from the past week 💰

Let’s dive in!

Aaron Patzer started Mint.com, a personal-finance software like Quicken and Money, when he was 25 years old. He moved to Silicon Valley with no connections, personally or professionally, working 14-hour days, 7 days a week, engineering the app himself. 

And it paid off. Within 2 years, he sold the company to Intuit (which makes Quicken) for $170 million. 

In 2013, Patzer launched Fountain, an ask-an-expert marketplace that connects individuals who have a problem to experts who can solve it on real-time mobile video calls, voice and text. It was sold to Porch.com 2 years later. 

His latest venture is Vital, AI-powered software that helps patients during their hospital visits. It guides them through what is going to happen while they’re there, how long they’re going to wait, how to interpret their lab results, and what to do next. 

Below, we’ve rounded up the best advice Patzen has given over the years about his exit from Mint.com.

M&A Lesson 1: Focus on creating value

Mint.com was born from Patzer’s frustration managing his personal finances with programs like Quicken or Money. The premise was to create a more user-friendly version of these personal-finance software. 

His primary focus was on creating a service that was genuinely valuable and easy to use, rather than anticipating an acquisition. He said, “I honestly didn't even think about [an acquisition]. I just wanted to create something that I wanted to use.” 

This approach made Mint.com valuable to the finance software giant Intuit. 10 minutes into his first meeting with Intuit CEO, Brad Smith – which was supposed to be just a casual introduction – Patzer was asked if he would consider selling.  

M&A Lesson 2: Strategic decision making

After that initial meeting with the Intuit CEO, Patzer took 3 months to consider selling. He used that time to evaluate Mint.com’s growth potential on its own versus the benefits of joining forces with such a large company. 

Patzer already had the foundations in place to expand into a larger company. Doing this independently was possible and his investors said they would support him if he chose to go that route. 

But what he really loves is to build things and see them being used by real people. This acquisition would allow something he built to suddenly reach 50 million people all over the world, something he thought would be difficult on his own. So he sold.  

M&A Lesson 3: Adjust to your new role post-sale

After the sale of Mint.com, Patzer worked for Intuit for 3 years. During this time, he felt he had lost a large part of his identity and the control over what he had built. 

Going from being the CEO of his own company and calling all the shots, he was “scolded like a schoolchild” by his colleagues once he started working for Intuit. He learned that he couldn’t make forward-looking statements to the press anymore, outlining where the company was headed.

For Patzer, although the acquisition felt like a loss, “fortunately, it’s a well-compensated loss, so there’s that.”  

Cashing Out: The Biggest Decision Of My Entrepreneurial Journey - To Sell Or Not To Sell 

Edin Basic has gone from struggling as a refugee from war-torn Bosnia, having to leave school in London before completing his final exams, to starting his own pizza company, Firezza. To do this, he raised money from VC funds and angel investors to scale Firezza up to 17 locations and sell to his largest competitor, Pizza Express.

In this episode, Edin talks about:

• The importance of understanding market trends to know when to invest and when to sell 

• Understanding your exit strategy to make the right decisions while you're building your business

• How to be ready when your ideal buyer comes knocking

M&A News 📰

• Retail: Luxury furniture rental company Vesta acquires Fernish and Feather, which will operate at Showroom.

• Food Delivery: Istanbul-based Getir, an instant grocery delivery company, has acquired FreshDirect, a New York City-based online grocery delivery company.

• Marketing: Digital marketing firm, AppsFlyer, has acquired DevtoDev, a comprehensive data analytics solution tailored for game and app developers.

• Natural resources: Newmont Corporation announced it has completed the acquisition of Newcrest Mining Limited to create the world’s leading gold company with robust copper production.

• Sports: Excel Sports Management, one of the juggernauts of sports talent representation, acquires rival agency REP 1 Football.

That’s all for now. 

Tune in next Wednesday for another set of M&A lessons, and have a great rest of the week. 👋