Thread by @jakobgreenfeld

Since selling his app business for a life-changing sum, Daniel Sim has monitored the Shopify app acquisition industry like no one else.

Here's what I learned from him about what going on right now 👇

Getting from zero to one on a new app if you have no audience is hard.

You can skip that by buying an existing app (e.g. on MicroAcquire) if you can get the numbers to work. (That's a big if.)

The sub-$500k space for Shopify apps is seeing extremely high multiples.

That means if you're just buying these apps for a financial return it's going to take a long time and has a lot of risk.

As a pure financial acquisition paying 8x doesn't make sense. But what's happening is that folks are spending $50k cash to fast-track learning.

Instead of starting from scratch, they start with a working app with existing customers and history.

This is also, for example, the idea behind @ShaanV's micro-SPAC experiment.

They ended up buying the Sold Stock app for $22k and gave it to @TheDanielMitch. I doubt there's a better way to learn.

If you can break out over $1m then multiples get back to sanity and can be a good financial investment.

Then further up the market we see multiples go high again as strategic buyers enter the picture.

Daniel created a private database to track acquisitions and other industry trends.

I convinced him to share it with others and you can get access here.

gumroad.com/l/shopify-app-…

Thanks for reading!

Make sure to follow Daniel here on Twitter: @drsim.

And if you enjoyed this thread, you might like my newsletter where I regularly share stuff like this.

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