Built to Sell Radio Ep 539 Deal Collapsed at LOI, Sold for 6x EBITDA Anyway
Mar 27, 2026
Jay Richards, founder who built Imagine Insights into a qualitative research platform for clients like Visa and Google. He recounts a collapsed LOI, lessons from diligence failures, why valuing on EBITDA worked in his favor, the tradeoffs of an earn-out, and the surprises that followed signing while shifting into a new leadership role.
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Hire Slow And Fire Fast
- Fire fast and hire slow to avoid keeping misfits too long.
- Jay kept people on because he wanted to be liked, which hurt performance and required him later to delegate hiring to better spotters.
Gave Real Equity Too Early And It Bit Back
- Jay handed out unvested equity early to many employees because he wanted everyone on the rocket.
- That created complications later when investors questioned why non-active ex-employees held real shares.
LOI Collapse Forced Jay Back Into The Business
- Jay mentally checked out after an LOI and planned holidays believing the deal was done.
- Five months in, diligence uncovered financial issues and the acquirer walked, forcing Jay to re-engage and run the company again.