EXIT
A business exit refers to the sale of equity and transfer of corporate ownership to another entity. Exits allow stakeholders to recoup the capital initially invested in the company and hopefully turn a profit.
MockDraftCentral.com
For many software entrepreneurs, growing their company quickly and selling it to the highest bidder is the end goal of all their long days and sleepless nights. It may sound easy, but upon successfully exiting his company after growing it for nearly eight years, and going through two rounds of funding in the process, Jason Pliml needed one thing: a break. “You can only put in so many 80-hour weeks before it catches up to you,” Jason said. Jason Pliml founded Mock Draft Central (MDC), a software platform to hold fantasy sports drafts, in 2002. He funded initial development through his work as a consultant at 43rd Parallel Technologies (a company he co-founded), but as MDC began to take off, Jason soon found that he could not continue to fund development on his own, and so he sought investment. At the time, the company was MOCK DRAFT CENTRAL founder Jason Pliml
generating over $20,000 in annual revenue, but pre-seed funds and startup accelerators were not widely publicized back in 2004, if available at all, so the process of seeking funding came down to good, old fashioned networking. “It took a while, but in the end I knew somebody who knew somebody who knew somebody, and I was all of a sudden talking with the boxer, Thomas Hearns, about investment,” Jason said. While Hearns ended up not funding Mock Draft Central, Jason soon connected with the newlyformed Grand Angels, who invested in the company after a due-diligence process of nearly seven months. In addition to the money, which allowed him to hire a full-time programmer and focus on proactively growing the company, the Grand Angels provided another huge value to Jason, a formal board of directors. Pliml’s board of directors held him accountable, and forced him to
take an objective look at himself as a business owner, and re-evaluate his focus based on what was best for Mock Draft Central. They helped transform him from an entrepreneur into a businessperson. It was not long after that a large player in the fantasy sports space came looking to acquire MDC, but Jason was not ready to sell. He still saw growth ahead. “Trying to sell a company is a huge distraction, but we had to listen,” said Jason in reference to the myriad spreadsheets, plans, financials and summaries required in acquisition conversations. “You kiss a couple frogs in the process, and sometimes, they’re just frogs. The timing just wasn’t right.” But after two more years, an opportunity to be acquired by one of two major fantasy sports companies came along. With an NFL labor dispute on the horizon and an influx of competition, both Jason and his board saw the opportunity as too good to pass. He and his board decided to sell the company. “Thankfully, we ended up selling it to a really solid organization,” Jason said. “I was contracted to work for them for up to 18 months after [the acquisition], so had it been a different organization, that might not have been as pleasant. But the highest bidder was also the best fit.” After three months, Jason handed over the reigns of Mock Draft Central to its new owners. Jason did not do anything for at least two weeks after the sale. He took about five months to reflect, and did a lot of reading and writing. “Decompressing from eight years of a startup is no joke,” Jason noted. And now, less than six months after a successful exit, Jason is already looking for his next project.
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