<description>&lt;div class="OutlineElement Ltr SCXW77883335 BCX8"&gt; &lt;p class="Paragraph SCXW77883335 BCX8"&gt;&lt;span class= "NormalTextRun SCXW77883335 BCX8"&gt;At some point every founder needs to ask a simple question: is it better to own a big slice of a small pie, or a smaller slice of a bigger pie?&lt;/span&gt;&lt;span class= "EOP SCXW77883335 BCX8" data-ccp-props= "{"134233117":true,"134233118":true,"201341983":0,"335559740":240}"&gt; &lt;/span&gt;&lt;/p&gt; &lt;/div&gt; &lt;div class="OutlineElement Ltr SCXW77883335 BCX8"&gt; &lt;p class="Paragraph SCXW77883335 BCX8"&gt;&lt;span class= "TextRun SCXW77883335 BCX8" lang="EN-CA" xml:lang="EN-CA" data-contrast="auto"&gt;&lt;span class= "NormalTextRun SCXW77883335 BCX8"&gt;In this week's episode, we hear from someone who chose a smaller slice of a bigger pie. Simon Lorenz co-founded Klara, a patient communication platform for medical practices, and raised &lt;/span&gt;&lt;span class= "NormalTextRun SCXW77883335 BCX8"&gt;roughly $32 million&lt;/span&gt;&lt;span class= "NormalTextRun SCXW77883335 BCX8"&gt; across six rounds of outside capital before selling to &lt;/span&gt;&lt;span class= "NormalTextRun SpellingErrorV2Themed SCXW77883335 BCX8"&gt;ModMed&lt;/span&gt;&lt;span class="NormalTextRun SCXW77883335 BCX8"&gt; at 15 times forward revenue.&lt;/span&gt;&lt;/span&gt;&lt;span class= "EOP SCXW77883335 BCX8" data-ccp-props= "{"134233117":true,"134233118":true,"201341983":0,"335559740":240}"&gt; &lt;/span&gt;&lt;/p&gt; &lt;/div&gt; &lt;div class="OutlineElement Ltr SCXW77883335 BCX8"&gt; &lt;p class="Paragraph SCXW77883335 BCX8"&gt;&lt;span class= "TextRun SCXW77883335 BCX8" lang="EN-CA" xml:lang="EN-CA" data-contrast="auto"&gt;&lt;span class= "NormalTextRun SCXW77883335 BCX8"&gt;The path there was not a clean one. Every funding round was painful. Most of them came down to a single term sheet, take it or leave it, because an early valuation had set an equity story Simon spent years chasing. He hired salespeople he later had to fire. He took on an apparatus he could not easily shut off. And when &lt;/span&gt;&lt;span class= "NormalTextRun SpellingErrorV2Themed SCXW77883335 BCX8"&gt;ModMed's&lt;/span&gt;&lt;span class="NormalTextRun SCXW77883335 BCX8"&gt; CEO first reached out, Simon almost ignored the email because the company had finally started humming and he was preparing another round.&lt;/span&gt;&lt;/span&gt;&lt;span class="EOP SCXW77883335 BCX8" data-ccp-props= "{"134233117":true,"134233118":true,"201341983":0,"335559740":240}"&gt; &lt;/span&gt;&lt;/p&gt; &lt;/div&gt; &lt;div class="OutlineElement Ltr SCXW77883335 BCX8"&gt; &lt;p class="Paragraph SCXW77883335 BCX8"&gt;&lt;span class= "TextRun SCXW77883335 BCX8" lang="EN-CA" xml:lang="EN-CA" data-contrast="auto"&gt;&lt;span class= "NormalTextRun SCXW77883335 BCX8"&gt;What turned a distraction into a deal was Simon's willingness to act genuinely uninterested, which pulled &lt;/span&gt;&lt;span class= "NormalTextRun SpellingErrorV2Themed SCXW77883335 BCX8"&gt;ModMed&lt;/span&gt;&lt;span class="NormalTextRun SCXW77883335 BCX8"&gt; up to a price that made his eyeballs pop out. What let him walk away twelve months after closing was a single clause his lawyer negotiated into the contract.&lt;/span&gt;&lt;/span&gt;&lt;span class= "EOP SCXW77883335 BCX8" data-ccp-props= "{"134233117":true,"134233118":true,"201341983":0,"335559740":240}"&gt; &lt;/span&gt;&lt;/p&gt; &lt;/div&gt;</description>

Built to Sell Radio

John Warrillow

Ep 542 The 15X Multiple That Let Him Walk Away in 12 Months

APR 17, 202668 MIN
Built to Sell Radio

Ep 542 The 15X Multiple That Let Him Walk Away in 12 Months

APR 17, 202668 MIN

Description

At some point every founder needs to ask a simple question: is it better to own a big slice of a small pie, or a smaller slice of a bigger pie? In this week's episode, we hear from someone who chose a smaller slice of a bigger pie. Simon Lorenz co-founded Klara, a patient communication platform for medical practices, and raised roughly $32 million across six rounds of outside capital before selling to ModMed at 15 times forward revenue. The path there was not a clean one. Every funding round was painful. Most of them came down to a single term sheet, take it or leave it, because an early valuation had set an equity story Simon spent years chasing. He hired salespeople he later had to fire. He took on an apparatus he could not easily shut off. And when ModMed's CEO first reached out, Simon almost ignored the email because the company had finally started humming and he was preparing another round. What turned a distraction into a deal was Simon's willingness to act genuinely uninterested, which pulled ModMed up to a price that made his eyeballs pop out. What let him walk away twelve months after closing was a single clause his lawyer negotiated into the contract.