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Andrew Gazdecki:
All right. I am here with Eyed from Awesome Motive. I’m super excited about this one. I’ve been a big fan of Eyed and everything that he’s doing. So, Eyed, thanks for joining me on this podcast man.
Syed Balkhi:
Thanks dude. Good to be here. Thank you for having me.
Andrew Gazdecki:
So to kick things off, do you want to give some background on Awesome Motive and what the firm is, what it does, how it works?
Syed Balkhi:
Yeah. Awesome Motive is my baby. I started this company where we build and buy software to help small businesses grow and compete with the big guys. And over the last decade, have built a portfolio of companies in WordPress space specifically, some in the SaaS space. And collectively, are now powering over 20 million websites.
Andrew Gazdecki:
20 million websites. Are you serious?
Syed Balkhi:
Yeah.
Andrew Gazdecki:
Dang. Well, congrats on that. I mean, that’s a few. That’s a good start. I know you’ve Acquired multiple companies. How many companies have you Acquired up to this day?
Syed Balkhi:
We have over 30 different brands across the Awesome Motive [inaudible 00:01:25]
Andrew Gazdecki:
So how did you get into this? So there’s a lot of people buying SaaS businesses today, but you’re one of the OG’s that was doing this before, I think everyone else jumped in. How did you get started and if possible, maybe what was the first acquisition and how did it go?
Syed Balkhi:
Yeah, sure. So a lot of people may know me from my blog called WPBeginner, where we create helpful work preceptorials to help non-techy people make their websites. And that’s how we got started. We saw and we were working with so many different plugins and SaaS companies, and we always had unique insights to share with those software developers and founders. And then, one day decided that I think we can do a better job at that with the insights that we had.
Syed Balkhi:
First acquisition was a slider and photography solution, Soliloquy and Envira Gallery, and they’re focused primarily on the WordPress market. The founder of that company ended up becoming my co-founder ain Optin Monster. His name is Thomas Griffin and he approached me at a word camp, which is WordPress specific conferences. I believe it was in Atlanta. And he said, I see that you promote competitor X. I am building a killer of that product. And I said, “Okay, well, whenever you’re done ready, come talk to me and we’ll help promote it,” and then he disappeared. He launched the product and then I forgot. And then we later reconnected and ended up rolling that business end and that gave it a start. And then since then we’ve been doing quite a bit.
Andrew Gazdecki:
That’s awesome. I love how you play the long game with founders. I’ve heard this a few times from you where I can’t remember what acquisition it was, but you had previously met the founders. So I love hearing that. My next question would just be, how do you evaluate startups? I know you alluded to specific focus on WordPress, but can you dive a little bit more into that? If you had to, maybe this is a harder question, but what’s like a perfect fit for Awesome Motive. If you could just, “This is the exact startup, I want to Acquire, size, market type,” what would that look like?
Syed Balkhi:
Sure. So we look at a value chain. We have many different solutions that provide across a different value chain journey for the user, from landing pages to analytics, to forms and so on. So we look at this user journey and see where the gaps are. For us the perfect acquisition and software, is something that fits along this line because one of our strengths is the side of our sheer network at this point. So that for us is above and beyond anything in terms of what we look for.
Syed Balkhi:
In terms of how we evaluate that is fairly standard. We look at where the revenue is, where the EBITDA is. What’s your growth rate year over year? What’s your churn? Those standard metrics are what we’re using, but for us, it has to be a fit into our portfolio. We’re not just going to go out of our way and buy something on completely this end of the spectrum that’s software that might just only be serving 30 enterprise customers.
Andrew Gazdecki:
Yeah. I love how your approach is strategic in a sense that you’ve built such a strong distribution channel. And then when you Acquire the companies, you improve them and you take them a little bit farther than they may have gone with the original founder. So that’s awesome.
Andrew Gazdecki:
This might be a hard question, but if you could only look at one metric when acquiring a company, what would it be? Just what?
Andrew Gazdecki:
Just one metric.
Syed Balkhi:
Probably net revenue retention.
Andrew Gazdecki:
That’s a good answer. Most say churn, but I like that one. That definitely is a good…
Syed Balkhi:
Factors all of it in.
Andrew Gazdecki:
Yeah. Someone recently told me basically, I don’t know if you would agree with this but, a good question asked is what would happen to your business if you doubled the prices? Which shows how churn would be affected and also net revenue retention. So I like that.
Andrew Gazdecki:
So we’re moving into 2022, the year’s just flown by. It’s already April, but there’s a lot of founders looking at, sell their business. And I know probably look at a lot of businesses. If you had to give just one or two pieces of advice to founders looking to potentially get Acquired, what would that be?
Syed Balkhi:
I’ve been on the founder shoe, I’m a founder myself. So I’ve gone through this journey myself a few times. And I’ll say to one, know exactly what you’re looking for. Oftentimes when founders enter this selling cycle, they’re still unsure about, do they want a clean exit? Do they want, and are now terms where they want to stay around for three years and so on? Don’t have this debate. I know what you’re really looking for in life. Otherwise, hold onto your business, don’t sell it if you’re unsure. That’s my number one advice, is to know what you really, really want. And I think that ends up being a better life decision long term.
Andrew Gazdecki:
I think that’s a really good one. Because there’s so many startup founders at start companies and they don’t think about their outcome. And I think the best example is, you raise a bunch of venture capital, but really maybe you would’ve been happy with a $3, $4 or $5 million exit, which is a large sum of money. But you feel like you need to build this billion dollar business when really that would’ve made you happy. Or that’s really just your goal. I say that option too.
Syed Balkhi:
You know what I find?
Andrew Gazdecki:
Go ahead.
Syed Balkhi:
What I find that’s interesting, Andrew, is when there’s lack of clarity, you may take a business to market and let’s say you’re using Acquire, then they’re already at the top 1%. But if they try to go and run a traditional process and let’s say they didn’t get what they wanted because they were actually unsure of what they wanted. In this period a lot of times founders lose the love that they had for their own business. And I’ve seen this happen way too many times. And I think knowing what you want ensures that you have a successful exit and you’re not back to running the business and not with you being 110% in there. Because that negatively impacts the business and I’ve seen that where you’ve Acquired something on the second go round and the business was worse than where it was in the first go round.
Andrew Gazdecki:
That’s some good advice.
Andrew Gazdecki:
I love the way that you Acquire businesses, you do it through the lens of an entrepreneur. And so you understand what it’s like to go through an acquisition as an entrepreneur. It’s a very emotional process. And also I’m assuming you’ve worked with a lot of founders that you have to explain how the acquisition process goes. So I’m just curious, what’s your favorite acquisition because you’ve created life changing outcomes for some entrepreneurs? Is there one that sticks out that is your favorite acquisition? That’s really broad, but…
Syed Balkhi:
Yeah, that’s a tough one. We’ve been doing acquisitions for quite some time now and just about every single one have turned out quite well. I would say, one of the ones that we recently did, about the beginning of 2020, it was called All In One SEO. And I’m still very, very excited about that because we use that tool internally on all of our businesses. Just the innovation that the team has been able to do since the acquisition is quite exciting and what’s coming next is very, very exciting as well. Favorite is tough, but I would say this is the one I’m super excited about that we’ve done in maybe in the last two years or so.
Andrew Gazdecki:
Nice. Yeah. It’s like asking, “Who’s your favorite child out of all of them?” I guess my last question is just to keep this quick is a, lot of founders probably look at you and see that you’re you’re successful, but I know your story. When did you start WPBeginner?
Syed Balkhi:
That was 2009. When I started the blog. I was using WordPress in the community since 2006.
Andrew Gazdecki:
So you’ve been doing this for two decades, so that’s just two decades of great work compounding. If you were just giving advice for founders looking to achieve what you’ve achieved with your businesses, what would you tell them?
Syed Balkhi:
Yeah, I think you just have to be consistently good for a long period of time to build something great.
Andrew Gazdecki:
I agree. I think you’re the big proof of that.
Syed Balkhi:
If you really believe in the mission that you’re serving, I really believe in the mission. We want to help level the playing field for small businesses and we can see the impact that we’re having, right. And we’re literally helping shape the web for billions of people World wide.
Syed Balkhi:
So it’s important that if you believe in that, just aim for consistency. Don’t try to compare your story, your chapter one to chapter 28 of somebody else’s story. Look at you and where you were yesterday and only have that. It’s you versus you all the time. And as long as you stay that, that helps you stay motivated. That helps continue to push forward and you are consistently good for a long period of time. And then one day you realize, “Oh man, this is awesome, what we built.”
Andrew Gazdecki:
Yeah, I’ve always admired. You made a very early bet on WordPress and then you’ve built so much around that. So again, consistency, patience, and just focus on a singular category can pay off. So congrats on all that.
Andrew Gazdecki:
Okay. So last two questions. These are ones I just always ask. Who’s an entrepreneur that you admire? I know you got two in the back of you, but let’s say you had the opportunity to get lunch with one entrepreneur. Maybe you’ve already had lunch with this entrepreneur. Who would he or she be?
Syed Balkhi:
I mean, you nailed it. I have two amazing figurines right behind me. These bust of Warren, Warren Buffett and Charlie Munger. I’ve religiously read their annual newsletters, biographies books. So the those two guys, always.
Andrew Gazdecki:
Nice. So I guess you maybe ruined my next question, which was, what’s your favorite book? Or what’s a book you’d recommend every entrepreneur reads?
Syed Balkhi:
This is probably not in everybody’s reading list. Lesser known book. It’s called The Dhandho Investor by Mohnish Pabrai. If you’re an entrepreneur trying to make the leap of investments, I would say dhe Dhandho Investor by Mohnish Pabrai. But otherwise The Psychology of Money by Morgan Housel is one of the top ones in my list as of late, I even paid my brother to read it.
Andrew Gazdecki:
You paid your brother to read it?
Syed Balkhi:
Yes.
Andrew Gazdecki:
Wow, that’s…
Syed Balkhi:
I think it’s a book that every entrepreneur, kid, adult needs to read. Just to understand, what’s the psychology behind money? It’s a corny title, but it has lots of practical examples in there. Of just compounding something that we often take for granted.
Syed Balkhi:
Then I have a list of books, but another one I would say is Atomic Habits by James Clear, because your habits determine your outcomes.
Andrew Gazdecki:
Nice. Did your brother actually read the book when you paid him?
Syed Balkhi:
Yes, he did.
Andrew Gazdecki:
So this has been great Eyed. I guess for entrepreneurs listening to this and maybe, they have a business, they want to reach out to you to potentially talk about getting Acquired by your firm. What’s the best way to get in contact with you?
Syed Balkhi:
Yeah. They can just shoot an email through AwesomeMotive.com. Or if they wanted to get through to me personally, they can go to syedbalkhi.com. But most of the time it will get to the same place.
Andrew Gazdecki:
Right on. Well, Eyed thanks so much for your time and congrats on everything, man.
Syed Balkhi:
Thank you, Andrew.
Andrew Gazdecki:
Cheers.
