How To Sell Your App

How to sell your app? Thinking about selling an app business or app you’ve created?

Selling your app and business could prove to be a very rewarding and profitable move. It can be a competitive space, but it is a strategy that has made other entrepreneurs and programmers very wealthy.

The big question is, how do you go about selling your app?

If you approach it the wrong way you could rob yourself of millions, and millions of people from benefiting from it. Done well, the outcome could far exceed your expectations.

Selling Apps

Selling apps and app-based businesses is a massive industry.

Apps have sold for millions and billions. Just think about Instagram and Whatsapp. You may even expand this to include the valuations of companies like Facebook or LinkedIn.

Or course, with so many apps and app creators out there, many have failed too. There seems to be an app for everything, and often many of them. We probably haven’t heard of the vast majority of them.

So, what are the steps to successfully selling your app, and maximizing the opportunity to do so?

Keep in mind that in fundraising, selling your company, a valuable digital product, or even intellectual property, storytelling is everything. In this regard, for a winning pitch deck to help you here, take a look at the template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.

Remember to unlock the pitch deck template that is being used by founders around the world to raise millions below.

Start With Your Why

To get it right, and achieve an acceptable or desirable exit, start with your why.

Why are you considering selling your app?

Did you design this app or app business to sell it from the start? Was that your whole intent?

Or are you just tired of working on it? Are you ready to cash out and take some time out? Or have you found a new opportunity or something that you are more passionate about doing? In this case, it can still make a lot of sense to sell your app instead of just folding the company and shutting it down. This may give you the capital you need to comfortably do what you want to next, and give it the best shot at being successful.

In other cases, your app and business may just have peaked and matured. You and your investors and cofounders may find this the best time to cash out before growth plateaus.

In fact, timing is important. Not just the timing in terms of how strong and attractive your business may be to potential acquirers, but also in terms of the wider M&A and capital markets. Some phases of the economy are much easier for others to buy and finance corporate acquisitions versus others.

Exit Before the Burnout

For others, the initial passion for creating and building an app has faded and become replaced with burnout from having to deal with all of the other tasks and responsibilities of running a real business. If you can get $100M out, and just go back to making things, while someone else worries about revenues, hiring and firing, marketing, and board meetings, that might be an attractive option for you.

Then in other cases, getting your app acquired is the best thing that can happen for the mission and vision. It can put your app in the hands of far more accomplished and connected experts, with far more reach and resources to scale it to have the impact you really want it to. If this is something you’d like to do, you’ll want to acquire information about how to sell your app.

Decide What’s For Sale

What exactly are you going to sell?

What are all the assets you have you can sell? Are you going to sell it all, either bundled together or separately? Or are you just going to sell off this one app? All of these are options.

You may only have one app. Or you may have multiple apps and products. Some you may be more interested in continuing with than others. An acquirer may not see the same value and interest in things as you do.

So, it is quite possible to sell off some or most of the business and keep the one technology you are most curious about continuing to work on. It could be a great financial win for both parties.

What IP, trademarks, copyrights, and other assets are you willing to sell? Do you also have any tangible assets which may be included, or sold off separately? For example, real estate, office furniture, and equipment.

Do you have contracts that are worth money? Recurring revenues? A brand and team that may be highly valued by an acquirer?

Whatever the situation, it is important to know what you are selling, or not.

Consider Who Would Buy It & Why

Before you can identify the best way to market and how to sell your app, you need to know to who you are marketing it.

This will also enable you to make tweaks to your business and messaging to optimize the value your ideal acquirers will put on your business and technology.

There are three main reasons that companies buy other companies.

1. To Eliminate The Competition

Many acquisitions are designed to take out the competition. This may be by merging and creating a larger giant on the block. It could be by acquiring upstart competitors, and just closing them down. Or it may be bringing those team, brand, and technology assets under their umbrella.

2. Efficiency In Creating

The other top reason that drives many acquisitions and M&A deals is that it is cheaper and faster than recreating the same thing themselves. Google, Facebook, or Microsoft probably duplicates what you’ve created. Though if it is more efficient just to buy your app, then it makes sense for them to do so. It’s also cleaner than trying to sue you out of business or bankrupt you with years of litigation to put you out of business.

3. To Acquire Key Metrics

Different acquirers have varying metrics which they need to acquire and excel at.

It may be maintaining growth in general, finding tax write-offs to boost profitability, new customer acquisitions, or cash flow to stay afloat.

Their infrastructure may also enable them to quickly scale your app, and make it far more profitable in a much shorter period of time.

Who are some of these companies you can begin building connections and relationships with?

What Do You Need Out Of The Sale?

Decide now what you really want out of selling your app.

If you don’t choose upfront and aren’t strategic and intentional in the process, you may not get what you really needed most.

Know your musts and must -nots. Use this as your guide.

Do you need a certain amount of cash now? Will you be happy with some blue chip stocks in your portfolio for retirement instead?

Do you have the patience to work for your new owner for the next several years for a larger earnout, and through the vesting period? Or are you most interested in gaining immediate freedom, with no constraints, or limitations?

What about jobs for your team, or ensuring your customers are taken care of?

Generate Inbound Interest For Acquiring Your App

Being able to generate inbound interest and offers for your app and company is powerful.

It puts you in control and gives you more strength in negotiations. So, how to sell your app?

Get Those Downloads

Running a great business is going to get you noticed. Rack up those app downloads.

Generate Revenues

Your acquirer may or may not care about the direct revenues that this app can generate for them. Yet, being able to generate paying customers says a lot about your product.

Show Your Brand Love

Show off how much people love your app, service, and brand. That goodwill has value too. Cultivate good reviews and write-ups.

Publish More Content

Make some noise about your app and achievements with content. Push out those blogs, and press releases, use article marketing, and get guest appearances on podcasts.

Try Out Partnerships

Trial partnerships with companies that may end up acquiring you. This is your chance to build contacts and relationships, prove the integration works, and show your value.

Run A Fundraising Process

M&A and fundraising processes are similar in many ways. They share many similarities in the preparation and materials you will create.

If you are in a position where you need cash to keep going, then laying the groundwork for a new fundraising round is smart, and will help keep your options open to do either, or both in some order.

In this situation, you may specifically try targeting strategic corporate investors who may end up buying you and integrating your app later.

Get Networking

Whether it is finding hires, cofounders, investors, or acquirers, the startup game is all about who you know, and who knows you.

Networking and developing those relationships will be some of the highest ROI time you can invest. Get out there and meet other founders who have had exits, business owners and executives, other app developers with connections, investors, and others. The more people that know about it the better.

Starting Marketing Your App For Sale

There are several ways to begin getting the word out that you may be willing to sell your app and company.

Which is best, most effective, and logical will depend greatly on the size of your business. Small business ventures and lifestyle businesses may be able to list themselves for sale online or use business brokers.

You may also find some connections by getting your investors involved in promoting the company for sale.

For mid-sized to larger transactions, it is just wise to enroll the help of an M&A advisor. They can help you value your company, advise on positioning it for sale, and make important connections to active and targeted buyers who may be shopping for something like you have.

You can then use them to help with preparing your business, negotiating the terms, and managing the transaction from due diligence through closing.

Preparing Your App Business For Sale

If you haven’t been diligently organizing and optimizing your business for a sale, then you may have some work to do.

You will want to get your bookkeeping and finances in order. You may need to tighten up your employee contracts, and vendor agreements, as well as corporate documents. You may have a lot more data to compile and organize.

Then you will need to create a very powerful and effective pitch deck or pitch book. This process will also help you work through your strengths and advantages, USP, augment your value, and show why they should buy you.

Summary

If you’ve created a great app, selling it, or your entire business can be the next great achievement in your life.

It is an opportunity to grow to another level. To not only potentially put a lot of zeros in the bank, but also enable your app to have a far larger scale impact, and set you up to do something even more fantastic next.

Work these steps, get expert help, and you could achieve a much grander exit than you realize. Follow these tips that will guide you through how to sell your app.

You may find interesting as well our free library of business templates. There you will find every single template you will need when building and scaling your business completely for free. See it here.