The Business Inquirer #021
In this issue I highlight 2 ecommerce listings, 4 SaaS listings, 4 content websites, and What I Learned Last Week.
Every week I highlight interesting online businesses which are for sale adding my own commentary. This newsletter is for those who are interested in business, finance, and entrepreneurship. Subscribe below to receive it directly in your inbox.
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Hello Friends!
In this week’s issue:
🛒 eCommerce - 2 listings
☁ SaaS - 4 listings
🕸 Content - 4 listings
🧐 What I Learned Last Week
🛒 eCommerce
Portfolio of 3 Survivalist Brands - $22.5M
For sale is a portfolio of 3 brands which sell popular subscription boxes and products targeted at survivalists. These include event boxes, skin and beard care, and meat and charcuterie boxes. This is a well known brand featured on major TV networks and even have their own Netflix Special.
Founded in 2015
Operated by 12 FT and 15 PT employees
3.3M website visitors in 2020
LTM Revenue: $23.8M; Profit: $5.2M; Margin: 22%
Asking: $22,250,000; Multiple: 4.28x
📝 TBI Commentary
At this deal size I’m sure there were conversations between the sellers and some PE and roll-up funds. Would love to see notes from those. Otherwise just an interesting listing. Not often you see a business with it’s own Netflix Special come up for sale. I’d think this would have to be a bolt-on acquisition.
You can view the listing on Website Closers.
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FBA Outdoor Baby Gear - $119k + Inv
For sale is an Amazon FBA business selling 3-SKUs of outdoor baby products. 100% positive reviews. Sole operator, no employees. Simple FBA business that can be operated as-is or expanded. Can source additional products from the vendor or design custom ones.
TTM Revenue: $137,125; Profit: $40,745; Margin: 30%
Asking: $119k + inv; Multiple: 2.92x
📝 TBI Commentary
Currently only sold on Amazon so there’s opportunity to branch out. I’d want to get more details on product sourcing, Amazon reviews, and return rate. Could be a good starter business for someone at a decent valuation.
You can view the listing on Quiet Light Brokerage.
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☁ SaaS
CAD Software - $880k
For sale is SolidFace 3D CAD which is a 7-year old SaaS. The software helps designers create 3D models and collaborate on projects. Competitors include AutoDesk, Stratasys, and 3D Systems.
5,110 active users
290k+ e-mail subscribers
20,967 monthly unique website visitors
Monthly Profit: $22,575
Asking: $880k (reserve not met); Multiple: 3.25x
📝 TBI Commentary
This is the type of listing where I think a service which helps sellers list their asset would be helpful. We have a 7-year old business which went from $0 to $22k/m in profit in the LTM. It’s also showing 100% profit margin. No mention of marketing, expenses, or sales channels. No explanation of how for 6 years it was a dud then all of a sudden it went to $22k/m. This could be a very interesting business but the listing doesn’t do it justice.
You can view the listing on Flippa.
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eCommerce Logistics - $650k
For sale is a B2B SaaS which helps ecommerce businesses with shipping logistics. Competitors include Shippo and Shipstation. Selling due to cashflow issues.
Founded May 2017
$1.5m in funding; 6 employees
11k registered users; 10% conversion rate
TTM Revenue: $1.6M; Profit: $0
Asking: $650k (open to offers)
📝 TBI Commentary
This listing is for an experienced operator. Need to add features, implement marketing, increase conversion rates. Need to understand the P&L to see why they’re not profitable. On first glance, 6 employees for an unprofitable business of this size is a bit puzzling. With that, they spent ~$3M ($1.5 raise + $1.6M revenue) on something. This could be an interesting opportunity to buy gross revenue and 11k users. Perhaps there are some easy strategy shifts that can be implemented to make this business profitable.
You can view the listing on MicroAcquire.
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Hotel Booking & Admin - $200k
For sale is a profitable cloud system used by hostels, independent hotels, and larger hotel chains to handle daily operations and bookings. Competitors include Sirvoy, Cloudbeds. Seller is tired from this business and wants to move on to new projects.
Founded Jan 2015
Raised $500k
TTM Revenue: $150k; Profit: $22k; Margin: 15%
Last Month Revenue: $10k; Profit: $3.5k; Margin: 35%
Asking: $200k; Multiple: 4.76x
📝 TBI Commentary
Valuation is rich on first glance but keep in mind that we’re in a COVID depressed revenue for this business. I’d be curious to know what it was generating in normal years. This analysis may show that it’s actually a great asset at a cheap valuation. This would be an interesting acquisition for someone who already has a product serving this space.
You can view the listing on MicroAcquire.
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Referral Program Integration - $25k
For sale is a micro-SaaS which allows anyone to setup a referral, affiliate, or loyalty program on any website or mobile app through integrations or an API. Competitors include Impact Radius, Tapfiliate. Customers include developers, marketers, and business owners.
Founded March 2020
Last Month Revenue: $250; Profit: $200; Margin: 80%
Asking: $25k; Multiple: 10.42x
📝 TBI Commentary
I like this space. Affiliate and referral is becoming more and more important in driving revenue for all types of businesses. I think this trend will only grow. If this was a content website you’d slap a 36 - 40 multiple on it and price it around $8k. In SaaS they tell you “don’t think about valuation for such low revenue business.” If you’re a marketer and have a clear path to grow this SaaS then it’s a great listing.
You can view the listing on MicroAcquire.
🕸 Content
Grow Getters Newsletter - $2k
For sale is the Grow Getters newsletter by Codie Sanchez founded in Aug 2020. The newsletter highlights tips and growth hacks for how to grow a newsletter. Primary readers are other newsletter writers and those interested in joining the creator economy.
Built on Substack
List Size: 2,283; Open Rate: 35%;
No revenue
Asking: $2,000
📝 TBI Commentary
Interesting to see this for sale. I wrote a guest post in this newsletter a few months back. I think I got 2 subscribers from that effort but it’s also not really my target audience. The listing is missing a key variable which is the CTR. Tough to put a value on it without that detail. I think the 35% open rate isn’t too hot either. Having said that, this newsletter could be a good purchase if you’re either already writing about growth/marketing/sales or would like to start.
On a similar note - Codie Sanchez’ Contrarian Thinking newsletter is not bad.
You can view the listing on Duuce.
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Paid Directory of Importers/Exporters - $57k
For sale is a 4-year old business directory that is used by importers and exporters of goods to connect with each other. The website has a free components as well as paid access.
Avg monthly revenue: $2,153; Profit: $1,953; Margin: 91%
Asking: $57,429; Multiple: 29.41x
📝 TBI Commentary
This listing is vague without any detail on traffic numbers or subscribers. I like marketplaces and directories as they are hard businesses to grow but simple to operate once there’s volume. They’re less dependent on Google algorithm changes and affiliate fee payments. This business has a steady $200 expense and relatively smooth revenue. I wish there was more detail provided in the listing but definitely something to explore if this type of business model is of interest.
You can view the listing on Flippa.
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2 Sound Proofing Review Websites - $210k & $68k
Two separate listings for two soundproofing websites. Both websites are in the same niche, both are around the same age (1.5 years), and both generate revenue from Amazon Associates & a display ad network.
114 articles; Ranking 13k keywords; 17 Domain Authority; 51k unique monthly visitors;
Revenue from Amazon Associates (US, CAN) and Mediavine
Monthly profit: $5,447
Asking: $210,648; Multiple: 36.84x
158 articles; Ranking 12k keywords; 27 Domain Authority; 32k Unique monthly visitors;
Revenue from Amazon Associates (US) and Ezoic
Monthly profit: $2,082
Asking: $67,680; Multiple: 35.51x
📝 TBI Commentary
I love finding two very similar looking assets with widely different earnings. I don’t know if these are being sold by the same seller. Here’s a summary of the key stats between the two listings:
The clear difference here is traffic, SEO, and ad networks. I didn’t lookup the bounce rate so conversion could be another factor. Motion Invest typically has higher quality, vetted listings.
You can view the listings on Motion Invest.
🧐 What I Learned Last Week
State of the industry report
Empire Flippers just published their 2021 state of the industry report. In total they analyzed over 800 sales to uncover long-term trends. They published it this morning so I haven’t yet had a chance to do a deep dive.
For 2020 they sold 298 businesses. Big spike in average sales price, total sales volume.
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Micro-payments are coming
Omar Ismail is an early-stage VC investor and publishes the excellent MediaTech newsletter. In the latest issue he talks about micro-payments, specifically for media purchases.
What are micro-payments?
A micropayment is a financial transaction involving a very small sum of money. For the purposes of this post, I define this as a payment under $1. I believe that most of the interesting benefits emerge at a cost far below this - in the range of $0.001-0.1.
Omar goes on to outline the benefits of micro-payments:
Monetizing the occasional user
Facilitating new types of (micro) content
Facilitating new business models
Supporting niche content
I agree that the space looks very interesting especially when combined with crypto. There’s still a lot of work to make micro-payments a reality but things seem to be moving in the right direction. The end of third-party tracking and user-cookies could be major catalysts. Imagine being able to access any online content you want and be charged a very small amount. No more need for monthly subscriptions or paywalls.
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Scale FBA like Thrasio
By now everyone should know Thrasio. Empire Flippers had their VP John Hefter on The Opportunity podcast to share some strategies that Thrasio uses to scale their FBA acquisitions. Admittedly I haven’t had a chance to listen to it yet but it’s on my to-do list. I’m sure anyone in FBA would benefit from listening to the podcast (unless it’s just a giant promotion for EF).
On the same topic, the NYT had a great piece titled “The Great Amazon Flip-a-Thon”. It highlights the FBA industry and how FBA businesses are started and flipped. Would highly recommend.
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Sportswear giants shift to DTC
The world’s largest sportswear companies are all moving in the direction of DTC and cutting out the middlemen.
DTC doesn’t necessarily mean online. It can be digital channels, company owned stores, and factory outlets. Selling direct has the potential to drive top- and bottom-line growth, it’s also not simple. Whether it’s shipping individual parcels to consumers instead of in bulk to wholesale partners, handling returns or taking full advantage of gained customer insights – running a DTC business efficiently at that scale requires significant investment in marketing and supply chain management. These same challenges are faced by any DTC brand. Tools which address those problems should continue to see strong adoption and growth.
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Opportunities in the WordPress ecosystem
Last week Jakob Greenfeld published an interview with Iain Paulson who owns successful WordPress plugins and a popular community.
Topics discussed:
It’s crowded (but that’s a good thing)
Ecosystem is becoming more professional
Important trends into the WordPress ecosystem
Themes are the past, plugins are the future
Build or acquire an existing plugin
In the article there are links to a database of WordPress plugins and other resources to look into this space for acquisitions. We forget but in many ways, WordPress is really the first no-code tool. Another interesting angle is that there’s currently no business marketplace to specifically buy and sell WordPress plugins businesses.
The whole article is a great read.
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The a16z Marketplace 100: 2021
The VC firm just published their ranking of the largest consumer-facing marketplace startups and private companies. Keep in mind that this data is for 2020 so it’s all impacted by COVID at least by some degree.
Just looking at the top 10 above, I’ve only heard of 4 of them.
Cameo & OnlyFans led the growth for celebrity engagement category below.
Highly recommend to checkout the full report.
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Complete guide to productized services
Robin Vander Heyden is the CEO/Founder of ManyRequests and publishes the excellent Productize News newsletter. He and his team just published a complete guide to starting growing, and operating a productized service. It’s an extremely valuable resource for anyone who’s thinking about this space.
I came across a productized design service startup you can buy on MicroAcquire. It’s built on top of ManyRequests.
On a similar topic - checkout this story of how an entrepreneur built a six-figure business by productizing and selling SEO audits.
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That’s all for this issue of The Business Inquirer!
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