Three M&A lessons from Jesse Pujji 👀

Welcome back to another edition of The Wise Exit.

Earlier this year, Jesse Pujji and his co-founders sold their performance marketing agency Ampush to Tinuiti for an undisclosed amount.

Pujji summed up the lessons he learned in building and selling his company in a fantastic Twitter thread, and, in today’s newsletter, we’re featuring three of those lessons that are most relevant to prepping your business for acquisition.

Let’s dive in!

Three Lessons from Jesse Pujji

Jesse Pujji started Ampush - a performance marketing agency focused on Facebook Ads - at the age of 25 with his two college roommates.

Earlier this year, thirteen years after starting the company, they sold it to Tinuiti for an estimated 8-figure sum.

Jesse has been very active on Twitter, sharing his journey as an entrepreneur in great detail and building in public.

Today, we explore three lessons from his thread on the sale of Ampush, and how we can apply them to our own exit goals.

M&A Lesson #1: “Building to sell is dangerous.”

In 2012, only two years into building Ampush, Pujji was offered “low 8 figures” to sell Ampush.

While an offer like this is a tremendous statement that you, as a founder, are on the right track, Pujji mentions that it can also serve as a distraction.

He says, “I thought: lets go harder/faster and sell for EVEN more,” and that it, “led to poor decision making.”

Don’t let dollar signs in your eyes blind you from the task at hand. Often, reinvesting energy back into your product and customers will pay larger dividends than shifting your priorities to suit your vision of what a hypothetical future buyer might want.

M&A Lesson #2: “Building on someone else's platform is a double-edged sword.”

Any large business variable that you don’t have control over can serve as a threat to a potential exit.

Oftentimes, businesses don’t have much of a choice in utilizing existing platforms for distribution (Facebook Ads, Google Ads, Twitter).

The danger, however, can be in hedging your bets and the success of your business almost entirely on one platform or application.

Pujji sums up the result of this approach, “You can grow fast, but you can’t control your destiny.”

This trade-off might be worth it in the early stages of building your business, but, in the long-term, not only is it unsustainable, but it could hamper your chances of a successful exit.

M&A Lesson #3: Know when you need support.

Pujji mentions how, nine years into building his business, he realized that he needed the support of a new CEO and transitioned himself out of the role.

While a difficult decision to make, Pujji understood it was the right move (and he was proven right months later, when the business grew to bigger than it ever had been before).

In an acquisition scenario, having an exit-experienced CEO or the support of an expert in the M&A space could be the difference between failure to exit and a successful outcome.

As business owners, we’re always better off for having identified our blindspots, asking for support, and leaning on those with expertise.

Cashing Out: Selling A Niche Business and How AI Is Changing M&A

Professor Joe O'Mahoney, an industry specific business consultant who built and sold his own company in 2007.

Since his exit, Joe has been using his personal experience in M&A to help business owners successfully grow and exit their boutique consultancy businesses.

In our discussion with Joe, we discussed:

• How professional service firms are valued during an M&A transaction 💰

• What great companies do to prepare for an exit 🤔

• How AI is disrupting the M&A world and what founders and entrepreneurs can do to leverage it 🤖

M&A News 📰

Read news around large/notable acquisitions from the last week.

• Music Streaming: Apple to Acquire Major Swedish Classical Music Record Label, BIS Records

• SaaS: AI-powered Automation Platform Acquires Denim Social and LumenVox to Expand All-In-One Solution

• Cybersecurity: Battery Ventures Acquires GrammaTech’s Application Security Testing Software Business, Forming CodeSecure

That’s it for this week.

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