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Comment by leandot | Hacker News Reader

Out of curiosity, what is your expectation for such a project? 3x arr is a standard measure, especially for such small numbers.

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From my experience, x arr is not a reliable metric for products of this size. They don't exactly have risk covered returns due to their size and they're usually bought for their growth prospect than any meaningful return it can give.

I didn't have any particular expectation per se, any x arr with the potential baked in is fine. But the most conversations I've had are bog-standard x months of profit and people looking to acquire it as an asset, which makes sense for them, but doesn't for me as I mentioned before the risk is pretty low in keeping it myself.

First of all congrats for creating something and achieving some traction. However, on the valuation side I think the things are a bit different. The size is just too small to justify a higher multiple, because you have to maintain the product, invest in marketing, etc. Until at least 5-6k mrr the buyer would be at a net negative (either hire someone to maintain or do it themselves and in a lot of countries the mrr is enough for neither).

A strategic buyer might buy it for the potential, but also at that size they can likely copy it quickly and with a bit of marketing scale it up.

I guess it's a bit of this and bit of that. The products I've sold before or discussed with others were on the former side. I think that was largely due to the metrics that are usually used to qualify (churn, MoM growth, etc.) are bit less impactful compared to a mature, stablized product.

It's mostly seen as a jumping board for them to quickly get going, compared to finding idea, building it, getting some SEO footing, etc. That's just my anecdotal experience btw.

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