How would I reverse engineer a cryptographic algorithm?

Question

I wrote an application that encrypts text in this way:

1. Get the input text

2. Reverse the text

3. Convert to hexadecimal

4. <

Answer 1

Err... I'd say:

1. Base64 decode the output.
2. XOR the output with the input to get the key.

I'm assuming that since this is a simple encryption algorithm, it should be easy to reverse it this way if you know the input and the output, but not the key.