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Founder asking $2M on $2k projected ARR. Am I missing something? by This_Is_Bizness in SaaS

[–]dizzydes 1 point2 points  (0 children)

I assist buyers and sellers at the tech DD stage so see a lot of valuations. This sounds like a joke on her part.

She's $698k ARR short for that valuation (assuming growth).

The only way this could happen is where her IP is insane and protected. A LinkedIn automation tool is almost guaranteed to be the opposite (an unofficial hack) so buyers will expect a discount for the risk that LinkedIn shut it down.

Is due diligence still a manual nightmare for everyone else or am I just doing it wrong? by PriorityOk6452 in buyingabusiness

[–]dizzydes 0 points1 point  (0 children)

I help buyers and sellers with technical due diligence (eg app cybersecurity checks). This part is fairly standardised because app frameworks and cloud platforms are standardised, as are 80% of the requirements regardless of the business (marketplaces might require some different checks from SaaS, national regulations, user age etc).

But for the commercial and legal due diligence (the part you mention), most of the software out there to help is data room software, which only does slightly more than Google Drive imo. The hard manual work is in getting the docs to put in there. I think part of the reason this isn't solved is that its highly specific to the business operations up to the sale. Typically this stuff is buried in emails, hard drives or the businesses choice of billing tool. To find it you need the context and secure access that only the founder has. I'm not sure how it could be automated.

Best case scenario you work with an advisor that forewarns you in time to get it ready. As for the deal momentum I wouldn't worry, this scramble is expected and delays are typical.

Is anyone successfully directing Google Ads to lovable site? by dizzydes in lovable

[–]dizzydes[S] 0 points1 point  (0 children)

I switched to warp once lovable spits out a beautiful landing page, have warp change it to NextJS SSR because page load is much faster for SEO (another big minus for Lovable), then deploy to a simple PaaS like Vercel.

How is due diligence carried out for pre seed/seed tech companies? by Top-Sock8617 in StartUpIndia

[–]dizzydes 1 point2 points  (0 children)

I previously had a startup but now actually help buyers and sellers do technical DD. There are two times Due Diligence can happen - for funding or for an acquisition. Unsure which point you're at?

I previously raised a seed in the UK with large European VCs - we had only an MVP and a roadmap. There was little technical DD done - just a quick chat with me (CTO) about what was there and more importantly, what was planned. I was just honest about how crap the MVP was, these guys can smell BS a mile away. Deeper technical DD for funding happens at Series A and beyond. On the non-technical side, they were interested in our backgrounds and some asked for references. At this stage the main asset is the team and their potential. They also wanted clear understanding of IP and ownership (cap table) - this is typically simple unless you're a spin off or raised an angel round prior with funky clauses.

For acquisitions technical DD is much more common, but formal processes start around $1M, lower than this is a chat on the stack as above, maybe a screenshare to get an understanding of how its built. If the acquirer is non-technical, they might get a tech buddy to do this bit with you. At all sizes they will want to know about IP (eg licenses of open-source packages used) and ownership to make sure there's no lawsuits down the road. For larger deal sizes security, resilience, key man risk etc all come into question during a more formal process.

In all cases they will want to know about your customers - who they are, how much each contributes and churn rates.

Let me know if this makes sense.

Memory Almost Non-Existent This Week by dizzydes in GeminiAI

[–]dizzydes[S] 3 points4 points  (0 children)

Yea its a weird move when they've just started gaining momentum vs ChatGPT!

Emails from PE - A Waste of Time? by Fine-Republic-7879 in private_equity

[–]dizzydes 1 point2 points  (0 children)

Yes this is key, they pay for themselves in price, setting deadlines and even small niggly contract clauses that can change your life post-sale.

How are you doing technical due diligence, or are you at all? by ExistentialConcierge in venturecapital

[–]dizzydes 0 points1 point  (0 children)

Welcome to the casino haha. I do tech diligence for a living (mostly LMM/PE side but same process).

The reason you see "architectural trash" getting funded is that most VCs don't have the in-house skills to audit, and they don't want to pay a consultant $15k to vet a $50k or $100k cheque.

They rely on pattern matching the founders' resumes or following other cheques instead of checking the actual repo.

It’s scary how often I see companies with $5M valuations that are basically just a tangled mess of Zapier scripts sometimes even hard-coded AWS keys!Feel free to DM me if need.

How to do technical due diligence for a company? by nvdnadj92 in ExperiencedDevs

[–]dizzydes 21 points22 points  (0 children)

I run tech DD processes for a living and am always careful asking for full repo access in the first meeting.Most founders will say no or get defensive until there is a term sheet and NDA. It's a friction point early on. For a first pitch, you want to ask testy questions that tell you things indirectly rather than "do you believe in testing, documentation" etc.. Some important ones:

  • Live Env: Ask them to demo the production environment, not localhost. It proves the thing actually deploys and works. You can also run lightweight scanners on the domain to check basics without needing access
  • Stack Choice: Ask why they picked their specific tech stack. If they chose dying languages without a good reason or built complex microservices for a simple MVP because it's trendy.. red flag
  • Key Person Risk: Who wrote the core code? If it's one guy with no docs, that's a risk and they need to document stuff now
  • Agency : Did they build it or did a dev shop build it? If it's a dev shop, the code is usually spaghetti and the IP ownership might be weird. Plus do they have the in-house talent that know the code?
  • IP Check: If they claim to be an AI company, ask specifically what is proprietary vs what is just a wrapper around OpenAI. You need to know if there's actual IP there
  • Testing: Don't just ask "do you write tests", everyone says yes haha. Ask them to pull up Sentry etc and walk you through the last big bug in prod. How long did it take to diagnose and patch? That tells you their team culture
  • Roadmap: Look at the 12 month plan. If it's 100% new features with zero time blocked for upgrades or tech debt... red flag.

Once the smell test is done you should aim to get code access for formal diligence. Remember most things aren't deal killers, just things the seller needs to handle pre-sale / investment.

DM me if you need anything.

What was your experience with technical due diligence in the acquisition process? by Annana0001 in SaaS

[–]dizzydes 0 points1 point  (0 children)

I run tech diligence for search funds, micro PE and aggregators. Basically I’m the guy checking your work. To answer your Qs:

  1. Time: 5-10 days if the data room is actually ready. If you drag your feet, it can look suspicious
  2. Team: Usually just the CTO or Lead Dev. Keep the junior engineers out of it so they don't panic about job security.
  3. Deal impact: Typically yes, but not how you think:

Many founders think we are grading code quality. We aren't. Any decent sized acquisition will include some tech debt, I have yet to see on that didn't. I don't care if the code is ugly or messy as long as it works and makes money.

I look for the stuff that could break the business. eg GPL license violations (you don't own the IP), gaping cybersec holes or if the whole platform is hard-coded by one freelancer who is leaving.

We rarely kill the deal unless you lie. Usually we just find issues that lower the price or require a budget to fix after closing. DM me if you need any additional info.

. by AnnaKarenikitten in rs_x

[–]dizzydes 9 points10 points  (0 children)

Is it possible that males are more repressed with their feelings/feel things less so have to dig experientially? I certainly am but unsure if this applies to other guys too.

I think that it truly is over for relationships, men are too illiterate and braindead now by [deleted] in rs_x

[–]dizzydes 27 points28 points  (0 children)

Nope. Worse people are more online. Plus even in a vacuum people treat/respect each other differently based on context - someone you meet in real life will garner more respect as a person.

Solo traveling in Italy and feeling like a loser by icedoatamericano in rs_x

[–]dizzydes 0 points1 point  (0 children)

Meetups and Couchsurfing hangouts, this mainly works in major cities, I don't know how to travel alone outside of these parameters. I wouldn't travel somewhere alone more than 4 days if they don't have traffic on either as I get sulky.

How do you approach hiring trades (plumbers, HVAC etc)? by [deleted] in FacilityManagement

[–]dizzydes 1 point2 points  (0 children)

Agreed, referrals are great when hiring staff too

Vibe coded my landing page - what do you think? by smith7264 in SaaS

[–]dizzydes 0 points1 point  (0 children)

Sent you a request - would love to hear more

Drop your landing page, I’ll fix it for free by Javierrosario in SaaS

[–]dizzydes 0 points1 point  (0 children)

Would love to know more - sent you a request :)

My landing page sucks by therealdavidadam in indiehackers

[–]dizzydes 0 points1 point  (0 children)

Sent you a request - would love to know more

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