Episode Overview

Title: Capacity Acquires $5m ARR Bootstrapped YouCanBookMe To Build AI Support Mega Platform
Host: Nathan Latka
Guests: Bridget Harris (CEO & Co-Founder, YouCanBookMe), David Karandish (CEO, Capacity)
Date: February 4, 2025
Theme:
This episode dives deep into the recent acquisition of the profitable, bootstrapped scheduling SaaS “YouCanBookMe” by “Capacity,” a fast-scaling AI-powered support platform. Host Nathan Latka unpacks the motivations, deal structure, founder philosophies, and the future vision behind this $5m ARR combination, offering rare transparency and practical takeaways for SaaS founders considering their own scaling, acquisition, or bootstrapping journey.

Key Discussion Points and Insights

1. The Acquisition Announcement and Immediate Context

• Capacity Acquires YouCanBookMe
  • David announces the acquisition:
    “Capacity has acquired YouCanBookMe. This brings world class online booking into our collection of AI powered platform pieces… We’re now able to do that on the tune of a million bookings a month.” (01:42 - 02:09)
  • Both companies highlight synergy between AI support and advanced scheduling as the driving rationale.

2. The Bootstrapping Journey of YouCanBookMe

• Bridget’s 12-Year Bootstrapping Path:
  • Grew from $0 to $5M in ARR through profitability, product-led growth, and family ownership, never seeking to sell (“We weren’t for sale… Capacity approached us and we liked the offer. We liked the fact that they’re in customer support and AI…” 02:36)
  • Bridget reflects on the need for bootstrapped founders to turn profit for real sustainability.
  • On reaching this stage:
    “If you’re bootstrapped over the long term, you need to start making money to make it worthwhile, frankly… It’s really exciting, something that means something for our team, our company, but also our customers.” (02:36)

3. Why Capacity, and Why Now?

• Finding the Right Fit:
  • Respect for founder-led structures:
    “There was something very obvious about the deal… the day before we signed… it got easier and it got more exciting… We knew this was the right thing.” (04:50)
  • Decision punctuated by a personal moment:
    • The deal closed on December 18th — the night of a Paul McCartney concert.
      “We told the lawyers… we have to close today because we’re going to see Paul McCartney tonight… Paul McCartney is more important.” (04:54)

4. Capacity’s Acquisition and Scaling Strategy

• Capacity’s Product and M&A Philosophy:

  • David describes breaking the customer journey into 24 steps, searching for “build or buy” opportunities across self-service AI, agent assist, and workflow/campaigns.
  • On the need for world-class scheduling:
    “As we got into it and started working with a lot of these support teams, particularly marketing and sales, we realized our biggest workflow was getting leads in, booking appointments… Scheduling is one of the biggest ones.” (06:29 - 08:04)
  • Acquisition selection involves market research, careful outreach, and prioritizing cultural fit.

• Acquisition Process:

  • David’s original outreach subject (LinkedIn, March 2024):
    “I sold my last company for $960 million… started Capacity to help automate support… Given the overlap, would love to sync up re: partnership or M&A opportunity…” (17:43)
  • Capacity has acquired 8-9 companies to date; uses tools like getlatka.com for market research.

5. Deal Structure, Founder Equity, and Motivation

• Deal Structure Transparency:

  • 50% cash, 50% equity deal—rare for founder-led, bootstrapped exits
  • Both the acquirer and acquiree value ongoing investment and upside:
    “For us, we feel like we’re handing over a founder-led company to a founder-led company.” (16:55)
  • Bridget:
    “We got a really generous amount of equity that we’re super happy with… because we’re bootstrapped, for me and Keith, we could take a hybrid offer much more easily than so many people who… take on far too much complicated cap table nonsense at the very beginning.” (26:15)

• Founders' Philosophies:

  • Capacity: Keep as much founder control as possible; David still has a third of equity and full board control despite multiple funding rounds ($100m+ raised), a uniquely non-dilutive pathway for a venture-backed SaaS.
    “I own just under a third of the equity and have complete board control.” (16:41)
  • YouCanBookMe: Prioritize team culture and continuity over financially maxing out through PE or “roll-up” acquirers.
    “I started to strongly feel we needed continuity… there needed to be some continuity there that I could be a part of… On the day after close, all of us felt like we’d applied for a job to work for Capacity.” (21:25)

6. Negotiation and Cultural Fit

• Negotiation Process:

  • Bridget rebuffed initial outreach but ongoing conversations built trust.
  • Emphasis on culture: first in-person due diligence in St. Louis led to the “aha” moment:
    “We… met David, met team… everyone was enthusiastic… Me and Keith went back… we just stared at each other, ‘this is on.’” (23:53)

• Deal “Hot Button” Issues:

  • Bridget initially thought she’d only accept a full-cash exit and leave.
  • Ultimately realized shared vision and continued involvement was more meaningful:
    “This way… I would always have felt like I was walking away… This way, never did… This feels safe to do this.” (24:44)

Memorable Quotes & Moments (with Timestamps)

• On closing the deal at a concert:
  “We told them on the day, we have to close today because we're going to see Paul McCartney tonight. No matter how important the Capacity team are, Paul McCartney is more important.” – Bridget Harris (04:54)

• On founder-led deals:
  “The fact that David and Chris have complete control of Capacity was a plus point for me and Keith, not a negative. Because for us, we feel like we're handing over a founder-led company to a founder-led company.” – Bridget Harris (16:55)

• On acquisition deal structure:
  “It was 50 cash, 50 equity. We were happy… we could take a hybrid offer much more easily than so many people who, as David says, take on far too much complicated cap table nonsense at the very beginning.” – Bridget Harris (26:00)

• On best outreach practices:
  “I sold my last company for $960 million… started Capacity… Given the overlap, would love to sync up re: partnership or M&A opportunity.” – David Karandish (17:43)

• On founder control and dilution:
  “I own just under a third of the equity and have complete board control.” – David Karandish (16:41)

• On the moment it clicked:
  “We did a face to face in St. Louis… everyone was so enthusiastic… we just said, ‘this is on’… The emotional feeling of like, yeah, we can do this. This feels safe.” – Bridget Harris (23:53)

• On integrating as founder-owners:
  “The day after close, all of us have felt like we've applied for a job to work for Capacity.” – Bridget Harris (21:25)

Important Segments (with Timestamps)

• [01:42] Capacity’s acquisition announcement
• [02:36] Bridget on scaling YouCanBookMe and approaching the deal
• [04:54] Closing date, Paul McCartney concert story
• [06:29] Capacity’s 24-step customer journey M&A philosophy
• [11:07] Capacity’s revenue and funding journey
• [16:41] David’s founder ownership and control
• [17:43] Original M&A outreach subject line
• [18:59] Bridging initial outreach to an eventual deal
• [21:25] Bridget on culture and continuity post-acquisition
• [23:53] St. Louis on-site DD leading to emotional buy-in
• [26:00] 50/50 cash and equity deal structure

Flow, Tone, and Practical Takeaways

The conversation is energetic, candid, and at times playful—most notably around the Paul McCartney anecdote—while providing hands-on, numbers-driven insights. Both founders deeply respect founder-led approaches and discuss their decision frameworks with unusual transparency, offering valuable lessons for founders contemplating bootstrapping, exit, or scaling via acquisition.

Practical Takeaways:

• Founder-led, bootstrapped exits can achieve both strong cash and continued upside with the right partner.
• Cultural alignment (not just valuation) makes or breaks M&A success.
• Maintaining founder control through funding rounds is possible but rare and valuable.
• Acquirers value fit, operational excellence, and alignment more than just price.

For SaaS founders and operators, this is a masterclass in how to build, scale, negotiate, and sell (or acquire) with integrity, clarity, and long-term vision.