The second Red Gate million dollar challenge

Are you a micro ISV or do you have a software product you want to sell? We’re setting aside a million dollars to buy the right desktop and web apps. Here’s why, and what you have to do if you want to sell.

When I kicked off the first Red Gate million dollar challenge last April with those same three sentences, I wasn’t sure what to expect. It seemed like a cool thing to do, and my gut instinct said that it might lead to interesting things. It did: we ended up buying {smartassembly} from Jean-Sébastien Lange.

It turns out that this was a great thing for Jean-Sébastien (he got some cash, he got out after the fun part of building a product, and {smartassembly} has continued to thrive), and it was a great thing for Red Gate (we’ve been able to take the product to a wider audience, and are continuing to develop it).

We’ve had similar successes with other products we’ve bought., .net Reflector, SQL Prompt, SQL Backup and SQL Hyperbac have all thrived under our ownership. In all these cases we’ve tried to do the same thing: introduce the products to a wider audience, and help them fulfil their potential beyond the means or ambition of their original creators.

We’d like to do this some more, and now seems like a good time. So we’re going to run another million dollar challenge.

We’re setting aside a million dollars to purchase third party technologies. We might buy a single thing for a million dollars, or ten for a hundred thousand, or any other variation. We might decide to spend more, or less, but a million dollars is our target.

Interested? Here’s what we’re looking for:

  • You’ve got to have a product. We’re not interested in prototypes. You must have customers. Happy customers, who – ideally – are happy to give you money for what you’ve built.
  • If you’re giving away, not selling, your product then we’re looking for high numbers (10,000+) of users.
  • We’re most interested in software aimed at .net developers, SQL Server developers and DBAs, Oracle developers and DBAs and Microsoft sysadmins. We’ll consider software outside of this area, but those are our sweet spots.
  • The product might be a desktop app or a web-based app. We don’t mind.
  • if you’re selling your product then it must have at least a 10% conversion rate. In other words, if ten people download it, or trial it, then, on average, one person should buy it. For us, this is a sign that you’ve got a product that works. We don’t care how many customers you’ve got – the fewer the better, in fact. It’s the ratio of trials to purchases that counts. If you’re not charging for it then we’ll look for a sign that a significant proportion of your users are actually using it regularly.
  • Now is a good time for you to sell. Maybe you’re struggling with marketing your product, or maybe you’re worried about the recession we’re in. Or maybe you just need the cash, or are bored.

If you’re interested, here’s what you have to do:

The closing dates for entries is August 16th 2010.

Here are some questions you might have:

Will Red Gate invest in my company?

No. We’re interested either in buying your company, or buying the product you’ve built. We won’t take a stake in your business.

Why should I sell?

You might have a number of reasons. The emotional ones might involve fear, boredom and excitement. Maybe you’ve taken the product as far as you can, or want, to and would like somebody else to continue to make it succeed.

If your product is worth more to us than to you, then you should at least consider selling it.

Why should I sell to Red Gate?

We’ve got a track record of buying products and, frankly, not screwing up.

Who is Red Gate?

Here’s Red Gate’s web site

What’s the process?

Send me an e-mail at explaining what your product is and why it fits what we’re looking for. The closing date for entries is August 16th 2010. We’ll get back to you shortly after, either to let you know we’re not interested or to ask for more information. At some point, we’ll meet up with you, make a yes or no decision, and sort out the details. It will probably take a month or two to go through the process.

Will you sign an NDA?

Not at this stage. If we decide to take things further, and start asking for sensitive information, then we might do.

Will I be able to carry on working on my product?

Maybe, maybe not. It depends a lot on you – why you’re selling, and what you want to do long term. Sometimes we’ve bought technologies and people have carried on working on them, but sometimes they prefer not to.

Why is Red Gate doing this?

We’re always looking for new ideas. We get e-mailed them occasionally, and stumble across them sometimes, but we figured it’s better to be systematic. If buying technologies is a good thing to do, then let’s do it well.

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