MyFitnessPal · B2C · calorie tracking app
Sell the app again after its growth has already slowed
Resold for over $100M less than the $475M paid five years earlier
Failedexit-ma
What they did
Under Armour paid $475M in 2015, pricing in future growth. Growth then slowed and the peak passed; when Francisco Partners bought it in 2020 the buyer paid for past performance rather than future growth. Guest's lesson: sell before you need to and before the peak, when you have alternatives and negotiating leverage.
What happened
2020 sale price was over $100M below the 2015 price.
“But the growth slowed down. You know, the the peak was in the past.”
“they paid over 100 million less for it, because they weren't buying the future as much as they were paying for the past.”
Related topics
Get tactics like this every Monday
New tactics from the week's founder interviews, each linked to where it was said.
More from this episode
- Flo: Pitch the app as #1 in women's health instead of competing in all of healthBecame the first women's health unicorn: $200M+ raised at a $1B+ valuation
- Runna: Aim the app at first-time runners doing couch to 5K, not all sportsEarned a strong valuation; Strava bought it to reach beginner runners
- Waking Up: Charge $20 a month or $150 a year for a meditation app~25K downloads a month bring in over $1M a month (Sensor Tower estimate)
- Waking Up: Build the app around a trusted podcaster, and put his voice in the first sessionTiny download numbers earn $200K-$1M+ a month; creator-dependence makes the app harder to sell
- Flo: Run over 100 experiments a monthGuest cites it as part of what made it a top health app; no direct numbers
- Strava: Buy a beginner running app so new runners later move up to your app
- MyFitnessPal: Buy a viral food-scanning app for its knack for pulling in new users
- BlueThrone: Buy apps that already found fans, then add a full team to grow themWorked really well, per the guest; no portfolio numbers given
- BlueThrone: Buy apps that get lots of downloads but lose users, then fix the productA couple of such deals brought outsized returns for founder and buyer, per the guest
- If you charge under $10 a month, test $20 on 10-20% of users
- Use weekly plans for apps people need for a short time, like datingWorks well in dating and follower-tracking apps; fine for cash flow, weaker for an exit
- Pick a buyer type, study its last 5 deals, and start talking a year earlyGuest's favorite deals came from founders he'd messaged with for ~12 months
- Once a TikTok works, spin up 20 to 100 more videos on the same ideaBuyers value a repeatable viral machine over one-off hits; no numbers given