GUSTO'S COFOUNDER SAYS AI MADE YOUR REVENUE WORTH LESS TO AN ACQUIRER AND YOUR SPEED WORTH MORE

Summary from the TLDR Founders newsletter

An acquirer may love your product and still decide it's faster to build its own. Gusto's cofounder explains that AI has shortened the time the company expects internal development to take, making acquisitions harder to justify. His example is hypothetical. If buying a company saves 18 months' worth of $50 million to Gusto, a business with $5 million in revenue might fit at a 10x multiple. One with $50 million in revenue probably won't. Your revenue can raise your asking price without increasing how much development time the buyer saves.