{"id":313091,"date":"2025-09-14T07:10:05","date_gmt":"2025-09-14T14:10:05","guid":{"rendered":"https:\/\/www.saastr.com\/?p=313091"},"modified":"2025-09-12T10:52:05","modified_gmt":"2025-09-12T17:52:05","slug":"whats-better-selling-for-50m-today-or-1b-later-it-can-be-murky","status":"publish","type":"post","link":"https:\/\/www.saastr.com\/whats-better-selling-for-50m-today-or-1b-later-it-can-be-murky\/","title":{"rendered":"What&#8217;s Better, Selling for $50m Today or $1B Later?  It Can Be Murky"},"content":{"rendered":"<div class=\"embed-twitter\">\n<blockquote class=\"twitter-tweet\" data-width=\"550\" data-dnt=\"true\">\n<p lang=\"en\" dir=\"ltr\">An early investment I made, I met with the CEO of a public company that wanted to buy them for $50m<\/p>\n<p>The startup hadn\u2019t raised much, they said No<\/p>\n<p>Years later, they sold for almost $1B<\/p>\n<p>The founders made about the same they would have, years earlier, in the first deal though\u2026<\/p>\n<p>&mdash; Jason \u2728\ud83d\udc7eSaaStr.Ai\u2728 Lemkin (@jasonlk) <a href=\"https:\/\/twitter.com\/jasonlk\/status\/1921936254628675690?ref_src=twsrc%5Etfw\">May 12, 2025<\/a><\/p><\/blockquote>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/div>\n<h3 class=\"text-2xl font-bold mt-1 text-text-100\"><strong>Why That &#8220;$50M to $1B&#8221; Acquisition Offer Isn&#8217;t Always What It Seems: A Founder Reality Check<\/strong><\/h3>\n<p class=\"whitespace-pre-wrap break-words\">I&#8217;ve seen this story play out multiple times as an investor, and the lessons are both counterintuitive and crucial.<\/p>\n<p class=\"whitespace-pre-wrap break-words\"><strong>TL;DR:\u00a0 In one of my very first investments, the founders turned down a $50M acquisition to see their start-up sell for $1B years later &#8211; yet walked away with roughly the same personal outcome they would have had by taking the first deal.<\/strong><\/p>\n<h2 class=\"text-xl font-bold text-text-100 mt-1 -mb-0.5\">The Tempting Early Offer<\/h2>\n<p class=\"whitespace-pre-wrap break-words\">Way back in 2013, I made an early investment in a promising startup. The team had built impressive traction without raising much capital &#8211; maintaining strong ownership and control.\u00a0 It was early, but by $1m ARR they&#8217;d pulled ahead of their seemingly similar legion of competitors.<\/p>\n<p class=\"whitespace-pre-wrap break-words\">Then came the moment many founders dream of: the CEO of a public company wanted to acquire them for $50 million.\u00a0 The founder actually reached out to me to have lunch, and asked if the founders would. be receptive.\u00a0 I said I thought so, but I didn&#8217;t know.<\/p>\n<p class=\"whitespace-pre-wrap break-words\">With minimal outside capital raised, this would have been life-changing money for the founding team. But they had bigger visions. They said no.\u00a0 In fact &#8212; they said &#8220;No at Any Price.&#8221;<\/p>\n<h2 class=\"text-xl font-bold text-text-100 mt-1 -mb-0.5\">The Long, Long Road to a Bigger Exit<\/h2>\n<p class=\"whitespace-pre-wrap break-words\">8 years later they were acquired for $1 Billion.\u00a0 What followed was the entrepreneurial equivalent of climbing startup Everst:<\/p>\n<ul class=\"[&amp;:not(:last-child)_ul]:pb-1 [&amp;:not(:last-child)_ol]:pb-1 list-disc space-y-1.5 pl-7\">\n<li class=\"whitespace-normal break-words\">5 different management teams<\/li>\n<li>2 more CEOs<\/li>\n<li class=\"whitespace-normal break-words\">4 more venture capital rounds<\/li>\n<li class=\"whitespace-normal break-words\">Years of grinding, pivoting, and scaling<\/li>\n<li class=\"whitespace-normal break-words\">Significant dilution with each new funding round<\/li>\n<\/ul>\n<p class=\"whitespace-pre-wrap break-words\">Eventually, the company sold for nearly $1 billion &#8211; a 20x multiple on that original offer!<\/p>\n<p><a href=\"https:\/\/www.saastr.com\/when-should-you-sell-your-startup\/\"><img data-recalc-dims=\"1\" decoding=\"async\" class=\"aligncenter size-full wp-image-313092 lazyload\" data-src=\"https:\/\/i0.wp.com\/www.saastr.com\/wp-content\/uploads\/2025\/05\/Screen-Shot-2024-01-11-at-11.04.14-AM.webp?resize=1000%2C484&#038;quality=65&#038;ssl=1\" alt=\"\" width=\"1000\" height=\"484\" data-srcset=\"https:\/\/www.saastr.com\/wp-content\/uploads\/2025\/05\/Screen-Shot-2024-01-11-at-11.04.14-AM.webp 1000w, https:\/\/www.saastr.com\/wp-content\/uploads\/2025\/05\/Screen-Shot-2024-01-11-at-11.04.14-AM-980x474.webp 980w, https:\/\/www.saastr.com\/wp-content\/uploads\/2025\/05\/Screen-Shot-2024-01-11-at-11.04.14-AM-480x232.webp 480w\" data-sizes=\"(min-width: 0px) and (max-width: 480px) 480px, (min-width: 481px) and (max-width: 980px) 980px, (min-width: 981px) 1000px, 100vw\" src=\"data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==\" style=\"--smush-placeholder-width: 1000px; --smush-placeholder-aspect-ratio: 1000\/484;\" \/><noscript><img data-recalc-dims=\"1\" decoding=\"async\" class=\"aligncenter size-full wp-image-313092\" src=\"https:\/\/i0.wp.com\/www.saastr.com\/wp-content\/uploads\/2025\/05\/Screen-Shot-2024-01-11-at-11.04.14-AM.webp?resize=1000%2C484&#038;quality=65&#038;ssl=1\" alt=\"\" width=\"1000\" height=\"484\" srcset=\"https:\/\/www.saastr.com\/wp-content\/uploads\/2025\/05\/Screen-Shot-2024-01-11-at-11.04.14-AM.webp 1000w, https:\/\/www.saastr.com\/wp-content\/uploads\/2025\/05\/Screen-Shot-2024-01-11-at-11.04.14-AM-980x474.webp 980w, https:\/\/www.saastr.com\/wp-content\/uploads\/2025\/05\/Screen-Shot-2024-01-11-at-11.04.14-AM-480x232.webp 480w\" sizes=\"(min-width: 0px) and (max-width: 480px) 480px, (min-width: 481px) and (max-width: 980px) 980px, (min-width: 981px) 1000px, 100vw\" \/><\/noscript><\/a><\/p>\n<h2 class=\"text-xl font-bold text-text-100 mt-1 -mb-0.5\">The Surprising Math Reality<\/h2>\n<p class=\"whitespace-pre-wrap break-words\">Here&#8217;s where things get interesting. Despite the massive headline number, the founders made approximately the same amount they would have walking away from that original $50M deal years earlier.<\/p>\n<p class=\"whitespace-pre-wrap break-words\">Why? Three critical factors:<\/p>\n<ol class=\"[&amp;:not(:last-child)_ul]:pb-1 [&amp;:not(:last-child)_ol]:pb-1 list-decimal space-y-1.5 pl-7\">\n<li class=\"whitespace-normal break-words\"><span style=\"text-decoration: underline;\"><strong>Dilution is relentless<\/strong><\/span>: Each funding round chipped away at founder ownership<\/li>\n<li class=\"whitespace-normal break-words\"><span style=\"text-decoration: underline;\"><strong>Liquidation preferences stacked up<\/strong><\/span>: Later investors received their returns first.\u00a0 While minor, it still impacted returns.<\/li>\n<li class=\"whitespace-normal break-words\"><span style=\"text-decoration: underline;\"><strong>Time is expensive<\/strong><\/span>: The founders spent years of their lives getting to the bigger exit.\u00a0 In fact, one passed away before the exit.\u00a0 I think about that a lot.<\/li>\n<\/ol>\n<h2 class=\"text-xl font-bold text-text-100 mt-1 -mb-0.5\">The Hidden Costs Nobody Discusses<\/h2>\n<p class=\"whitespace-pre-wrap break-words\">What the headlines never show:<\/p>\n<ul class=\"[&amp;:not(:last-child)_ul]:pb-1 [&amp;:not(:last-child)_ol]:pb-1 list-disc space-y-1.5 pl-7\">\n<li class=\"whitespace-normal break-words\">The psychological toll of multiple management team changes<\/li>\n<li class=\"whitespace-normal break-words\">Founder burnout and relationship strain<\/li>\n<li class=\"whitespace-normal break-words\">Opportunity cost of other ventures never pursued<\/li>\n<li class=\"whitespace-normal break-words\">Years of life dedicated to a single outcome<\/li>\n<\/ul>\n<p><iframe title=\"Jason Lemkin on &quot;Avoiding bad advice when selling your company.&quot;\" width=\"1080\" height=\"608\" data-src=\"https:\/\/www.youtube.com\/embed\/Y4dxrSvgrao?feature=oembed&#038;enablejsapi=1&#038;origin=https:\/\/www.saastr.com\"  allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen src=\"data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==\" class=\"lazyload\" data-load-mode=\"1\"><\/iframe><\/p>\n<h2 class=\"text-xl font-bold text-text-100 mt-1 -mb-0.5\">When To Take The Early Exit<\/h2>\n<p class=\"whitespace-pre-wrap break-words\">Here&#8217;s my hard-earned advice for founders:<\/p>\n<p class=\"whitespace-pre-wrap break-words\"><span style=\"text-decoration: underline;\">If an early acquisition offer would be truly life-changing for you personally, give it serious consideration<\/span>. The glamour of pursuing a unicorn exit often masks the brutal reality of what it takes to get there.<\/p>\n<p class=\"whitespace-pre-wrap break-words\">Sometimes the &#8220;smaller&#8221; win that puts millions in your pocket today is worth more than the theoretical bigger win that might come years later after significant dilution.<\/p>\n<p>In fact, my advice today is Default Yes.\u00a0 Default &#8212; take an M&amp;A offer if it&#8217;s good.\u00a0 If you are 95%+ sure you can built something 10x bigger, then say No for sure.\u00a0 Go Long.<\/p>\n<p>But default to Yes for a strong M&amp;A offer.\u00a0 At least to talk about it from that perspective.<\/p>\n<p>Brian Halligan, co-founder and Chair of $30B+ HubSpot &#8230; agrees:<\/p>\n<p><iframe title=\"The Honest Truth About Selling Your Company with HubSpot Co-Founder Brian Halligan\" width=\"1080\" height=\"608\" data-src=\"https:\/\/www.youtube.com\/embed\/gMTNrjZNw2w?feature=oembed&#038;enablejsapi=1&#038;origin=https:\/\/www.saastr.com\"  allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen src=\"data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==\" class=\"lazyload\" data-load-mode=\"1\"><\/iframe><\/p>\n<h2 class=\"text-xl font-bold text-text-100 mt-1 -mb-0.5\">The SaaStr Bottom Line<\/h2>\n<p class=\"whitespace-pre-wrap break-words\">Don&#8217;t automatically chase the bigger headline number. Do the math on what you&#8217;ll actually take home, factor in the true cost of time, and make the decision that&#8217;s right for you &#8211; not what looks impressive on social media.<\/p>\n<blockquote class=\"wp-embedded-content\" data-secret=\"wszTbPCTfQ\"><p><a href=\"https:\/\/www.saastr.com\/dear-saastr-how-do-i-know-if-its-the-right-time-to-sell-my-company\/\">Dear SaaStr:  How Do I Know If It&#8217;s The Right Time to Sell My Company?<\/a><\/p><\/blockquote>\n<p><iframe class=\"wp-embedded-content lazyload\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; visibility: hidden;\" title=\"&#8220;Dear SaaStr:  How Do I Know If It&#8217;s The Right Time to Sell My Company?&#8221; &#8212; SaaStr\" data-src=\"https:\/\/www.saastr.com\/dear-saastr-how-do-i-know-if-its-the-right-time-to-sell-my-company\/embed\/#?secret=QYcFLfwGDD#?secret=wszTbPCTfQ\" data-secret=\"wszTbPCTfQ\" width=\"600\" height=\"338\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\" src=\"data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==\" data-load-mode=\"1\"><\/iframe><\/p>\n","protected":false},"excerpt":{"rendered":"<p>An early investment I made, I met with the CEO of a public company that wanted to buy them for $50m The startup hadn\u2019t raised much, they said No Years later, they sold for almost $1B The founders made about the same they would have, years earlier, in the first deal though\u2026 &mdash; Jason \u2728\ud83d\udc7eSaaStr.Ai\u2728&#8230; <br \/><a class=\"more-link fade\" href=\"https:\/\/www.saastr.com\/whats-better-selling-for-50m-today-or-1b-later-it-can-be-murky\/\">Continue Reading<\/a><\/p>\n","protected":false},"author":19,"featured_media":313092,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","om_disable_all_campaigns":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"_wpscp_schedule_draft_date":"","_wpscp_schedule_republish_date":"","_wpscppro_advance_schedule":false,"_wpscppro_advance_schedule_date":"","_wpscppro_custom_social_share_image":0,"_facebook_share_type":"default","_twitter_share_type":"default","_linkedin_share_type":"default","_pinterest_share_type":"default","_linkedin_share_type_page":"","_instagram_share_type":"default","_medium_share_type":"default","_threads_share_type":"","_selected_social_profile":[]},"categories":[31],"tags":[],"class_list":["post-313091","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog-posts"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/www.saastr.com\/wp-content\/uploads\/2025\/05\/Screen-Shot-2024-01-11-at-11.04.14-AM.webp?fit=1000%2C484&quality=65&ssl=1","jetpack_shortlink":"https:\/\/wp.me\/p5oib2-1jrR","jetpack_sharing_enabled":true,"fifu_image_url":"https:\/\/www.saastr.com\/wp-content\/uploads\/2025\/05\/Screen-Shot-2024-01-11-at-11.04.14-AM.webp","_links":{"self":[{"href":"https:\/\/www.saastr.com\/wp-json\/wp\/v2\/posts\/313091","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.saastr.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.saastr.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.saastr.com\/wp-json\/wp\/v2\/users\/19"}],"replies":[{"embeddable":true,"href":"https:\/\/www.saastr.com\/wp-json\/wp\/v2\/comments?post=313091"}],"version-history":[{"count":1,"href":"https:\/\/www.saastr.com\/wp-json\/wp\/v2\/posts\/313091\/revisions"}],"predecessor-version":[{"id":313093,"href":"https:\/\/www.saastr.com\/wp-json\/wp\/v2\/posts\/313091\/revisions\/313093"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.saastr.com\/wp-json\/wp\/v2\/media\/313092"}],"wp:attachment":[{"href":"https:\/\/www.saastr.com\/wp-json\/wp\/v2\/media?parent=313091"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.saastr.com\/wp-json\/wp\/v2\/categories?post=313091"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.saastr.com\/wp-json\/wp\/v2\/tags?post=313091"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}