Ep 538 How 2 Brothers Bootstrapped AppArmor to a $40M Exit — The Answer That Almost Cost Them $20M

**David Sinkinson** (0:07)
Hi there, and welcome back to another edition of Built to Sell Radio, the podcast designed to help you punch above your weight in negotiation to sell your business. Today, an exit story. The tale of two brothers who built a campus safety software company from scratch, took no outside investment, and sold for $40 million in cash without an earn out. This episode was actually recorded live at the Value Builders Summit, an annual gathering of advisors who help business owners build more valuable and sellable companies. If you're listening to this, there's a good chance that you're already working with one of those advisors. And if you're not, you can find one over at valuebuilder.com.
David Sinkinson is a returning guest, and this time he goes beyond the deal, into the surprising struggles that come when work becomes a choice, not a requirement, and a controversial take on employee equity that most founders won't see coming. Without further ado, here is John Warlow with David Sinkinson. Enjoy.

**John Warrillow** (1:14)
David Sinkinson, hey, welcome back.

**David Sinkinson** (1:17)
Why no?

**John Warrillow** (1:18)
Tour of Duty number two, Built to Sell Radio.

**David Sinkinson** (1:20)
Pretty awesome, actually.

**John Warrillow** (1:21)
Yeah, it's awesome to have you back.

**David Sinkinson** (1:21)
This is the first time I've been on a podcast twice. Yeah, I know. I'm pretty fun, other than my own, but that doesn't really count.

**John Warrillow** (1:27)
That doesn't really count. The book is called Start Up Different, and I interviewed you last time, like months before the launch of the book, and the book's had a ton of praise, awards, and a lot of traction. So I want to get into some of what's in the book and talk a little bit about your journey. Let's just kind of, for folks who haven't listened to Episode 1, walk through the AppArmor journey. How did this thing get started? How did it go?

**David Sinkinson** (1:54)
Yeah, absolutely. So obviously, big focus on the book is from my company's experience. But so basically what it is is I was working at a university in Canada. I'm Canadian. I don't know if you can tell. You're going to hear a couple of A's and abouts and roof and, I don't know, house or whatever. Yeah. Any other Canadians in the house? Give me something.

**John Warrillow** (2:13)
Yeah.

**David Sinkinson** (2:14)
It's been a rough year for Canadian sports, eh? Oh, man. Anyway, Blue J is still breaking my heart in Team Canada yesterday. Anyway, but back to AppArmor. So basically what it was is we worked with universities and colleges and on every single college and university campus. So these emergency blue light poles, if you're familiar with what they are, you press the button, campus security, your campus police comes and saves the day. And so my alma mater, I was on a committee. We did an audit and about 30 percent of them were broken. Sitting in the right place at the right time, I was sitting across from the associate dean of student affairs, and I said, well, what if you had a mobile app where you could call campus security? And that's where the concept started. This was back in 2011 Like for context, the app worked on Blackberry. If you remember Blackberry, another Canadian legacy there. And it really took off from there. What was different about us is that it wasn't one single app. We actually created custom apps for every single institution we worked with. And they were all focused on public safety. So if you went to Vanderbilt University, it was Vandy safe. If you were at University of Florida, it was Gator safe. If you're at UCLA, Bruins safe, so on and so forth. And this led to a really significant in-market competitive advantage where we got about 50 to 100 times more downloads versus our competitors. So it was a really good way to go to market. And things went well. Lots of, we actually won awards for the app as well. Lots of word of mouth referral. You know, the million steps in between. We hit the hockey stick growth curve, doing a couple of different things, but mostly by adding more software, sort of product proliferation, we moved into this emergency notification space, which is our competitors very much considered safe. We got into that space and we were kicking their butts. And then the pandemic hit, we moved a little bit into health-related functions, and that really boosted... At first, it was terrible because, of course, we were in public safety and people congregating wasn't really allowed. We can go into this more later.
But then we introduced new product lines that worked really, really well with our existing mobile apps. We were approached by a strategic, and I can definitely talk about that process today because I think that's probably pretty interesting to just about everybody in the room. And we sold, and after about a year and a half, I was done, worked at Motorola Solutions for three fabulous months. You keep your business card?