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The blog for ambitious founders.

My blog covers the MANY highs and lows of starting, scaling and selling my business for 7-figures, in just 4 years. If you're an ambitious entrepreneur then add your email below to get a new episode delivered every Wednesday.

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The Molzi Story, flying the nest

It was time to sell

As Molzi turned 4 years old, my mind was set on selling the business. A combination of things driving it, but mainly that I was exhausted, I felt like I had reached the limit of where I could add value, and… I wanted the money!

Up to this point we had received 12 approaches to buy Molzi. Some had been from large global agency groups, some had been large US Amazon agencies and some had been from private equity backed roll ups. So far the faithful gut feel was telling me no. Damn that gut feel I thought, it just doesn’t want me to be happy.

But then Brainlabs came along.

I first heard of the contact via one of our investors who knew someone on the board of Brainlabs. He mentioned that it was a digital media business based in the UK that was growing like crazy, successfully set-up in the US and was all about the data. On the surface this ticked many of the boxes, particularly as we had no business in the US already, and data wasn’t our biggest strength.

It was suggested that I have an intro call with Dan, the founder and CEO. Due to time pressures, the call was set-up the day after I had a hernia operation under general anaesthetic. I left the call feeling very good about the opportunity but wasn’t sure how much was Dan’s charm and how much was the copious amount of painkillers in my bloodstream.

We agreed to meet up again to talk in more detail. The next big tick in the Brainlabs box – the meeting wasn’t in a conference room somewhere, but walking around Hampstead Heath. Just a little detail, but a big sign for me that Brainlabs could be a great cultural fit. Me and Dan hit it off on our walk and parted ways agreeing that we should progress with seeing if a deal would work between us.

Now I had absolutely no knowledge of the M&A process. What needed to happen between someone saying we would like to buy you, and you handing over the keys. Fortunately, our investors had pretty much all been on either side of the M&A table and offered great guidance. My one bit of advice to anyone thinking about selling, no matter how far in the future, speak to people that have done it before and get yourself an advisor.

We hired an M&A advisory firm (SI Partners – I would 100% recommend!) and quick as a flash it was a classic case of ‘my people talking to their people’. A huge amount of pain is taken away by working with experts, and it allowed me and Dan to continue our discussions about World domination while the various teams did the harder negotiations.

After a week or so, Brainlabs provided a Letter of Intent (LOI). Basically, a super compact offer letter just outlining the terms and value of the deal. A bit like someone offering to buy your house. At this point you accept the offer and then the work gets started behind the scenes with surveys etc to identify skeletons in the closet.

Brainlabs took us to Wembley, a good start (apart from the result!)

The day I received the LOI was a very odd one for me. This was the first step in the moment I had dreamed about as a child. Selling the business that I had built. It was written in black and white the amounts of money I would get, and my life was about to change forever. Only, my head went the other way. I briefly thought about how exciting this was and then instantly into why it will probably go wrong.

Clearly on the LOI, underneath all of the lovely high-five type of information was the dreaded ‘subject to the following terms’. The first one was something about contacting our top 10 clients and making sure they are happy with us. Despite that fact that Molzi had little to no client churn, certainly at the top, my assumption was that if someone asked them then maybe they would unload all of the problems they’d just not had a chance to mention. Clearly I was just trying to protect myself from getting too excited and then let down, but it meant that on the various celebration calls I had with people that evening, my face was smiling but I felt sick inside.

Now that we had terms agreed and we were ‘under offer’, it was time to start hunting for those skeletons. The M&A team at Brainlabs were amazing throughout the process in making it clear what they needed, what they were looking for etc. But the due diligence process was pretty daunting none the less, purely due to the sheer size of the requests. The first document request came through from PWC for legal, tax, commercial and technical due diligence. Something like 500 documents, from contracts with clients, previous employee issues, bank account details for Brazil and Singapore, the list went on. My concern at this stage wasn’t that they would find skeletons that we were trying to hide, but that there were skeletons that I didn’t even know about!! The fact that we had legal entities set-up in UK, Spain, Hong Kong, Brazil and Singapore, as well as tax accounts and bank accounts. We certainly didn’t make it easy for ourselves!

Due diligence lasted around 6 weeks, and was intense. But to be honest, I really enjoyed the period. It was very hard work, but I had a super clear idea of what I was doing every day, from 7am until 11pm. Life was tiring but simple. I must add that the simplicity was purely down to the incredible Molzi team, particularly the finance team who had all of our documents in such great order. We were actually told by one of the contacts at PWC that we were the best business that had ever reviewed in terms of our organisation.

Despite enjoying the challenge of due diligence, I was still wrestling with the fact that my life was probably going to change forever, but maybe wouldn’t. It’s a very privileged problem to have, but really does take over your brain space. I found myself checking on a calculator how much money I would get in my bank after tax etc. Even though the number was always the same, I kept doing it for months. It seemed to help for some reason.

Oddly I developed an addiction to the hot tub, to keep me relaxed and sane during due diligence

One rather strange life change that I made during this pretty intense period was to start using the spa at my local gym. I had a daily routine of hot tub, sauna and steam room. Only for around 30 minutes but I was able to really relax and get absolute clarity in my thinking. I solved 90% of all the due diligence challenges in that hot tub. Such is my addiction with continuing my daily spa routine, that my younger daughters first words were ‘hot tub’. That may not be 100% accurate, but they were definitely in the first 10. Even now, at the age of 3 she insists that when she’s a big girl she will live in a camper van with a hot tub. Seems I’ve scarred her for life with the oddest of vices.

One of the most difficult parts of this period was having to keep it a secret from the majority of the Molzi team. Of course, much of the discussions are confidential, but also there is a chance the deal may fall through. And most important is that the business must continue as normal. There’s no point in putting all effort into the M&A process if half the revenue disappears. The Molzi team were phenomenal. I was effectively out of the business for 4 months and Molzi continued to grow and thrive throughout. You could argue that maybe I wasn’t needed at all then, but I’d rather you didn’t.

After 6 weeks, due diligence was completed, and no skeletons made an appearance. This was a great feeling, almost like getting a badge to say I’d run my business well. But no badge was forthcoming, and we proceeded to start drafting and negotiating the Share Purchase Agreement (SPA). The SPA is basically the contract for the sale, including full details of the deal, and every possible thing that could go wrong. Safe to say, my newfound negative brain was loving this as a chance to mess with me for the next 4 weeks while it got finalised. Eventually, 152 pages of contract were done and agreed.

I was a bit of a broken shell of a person by this point. My wife described me as a bit like a zombie. I was physically present around the house, but my mind was somewhere else. I would randomly fall asleep while talking to the kids. Basically, the previous few months of physical and mental demands had taken its toll. It wasn’t until I saw the photo below of me the week before the contract was signed that I realised I was tired. I hope this image doesn’t haunt your dreams.

I was a bit broken by the end!

To celebrate signing the contract, and to try and recover quick enough to start delivering on the earn out, my wife and I booked 5 nights in Greece WITHOUT THE KIDS (sorry for the caps kids). A perfectly made plan, apart from the fact that signing day was delayed by 2 days and now I would be signing the contract from a sun lounger in Greece. Safe to say the lawyers and bankers didn’t share my excitement at this outcome, but those 5 days in Greece were going to become some of the most memorable moments of my life.

I’m going to save that for another blog because it was a very interesting 5 days. I experienced becoming a millionaire. And it didn’t feel like I thought it would. But I did feel lots of things (sounds worse than it is), that I’ll share next time.

See you in Kefalonia (read it here)!


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