The Business Inquirer #090
The Business Inquirer #090
In this week's issue, I highlight four listings including a cannabis testing startup, a GovTech business, a travel media brand, and more.
The Business Inquirer covers the most interesting tech-enabled business acquisition opportunities. Written for entrepreneurs, search funds, investors, and business owners. It’s completely free and you’re guaranteed to learn something new.
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Hello Friends!
Seeing a lot less interesting business listings lately. Could be a summer slow down or other factors.
In this week’s issue:
🛒 eCommerce - 0 listings
☁ SaaS - 2 listings
🕸 Content/Service/Other - 2 listings
🛠 Tools & Resources
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🛒 eCommerce
☁ SaaS
Cannabis & Hemp Testing - $630k
For sale is 5-year-old Delta Leaf Labs which is a SaaS + web3/DAO business that conducts genetic testing of cannabis & hemp. Must read the “Reason for Selling” section to see the downsides of taking VC money.
SaaS subscriptions for data analytics apps
Data monetized through a web3 marketplace
2,000 clients; 3,000 e-mail subscribers
Full laboratory & machinery
TTM Revenue: $420k; Profit: $120k; Margin: 29%
Asking: $630k; Multiple: 5.25x
✅ What I Like
Launched by a molecular biologist with deep subject-matter-expertise. He’s willing to stay on in the business in some capacity. I have an acquaintance who runs a large cannabis grower and he always mentions that lab testing is the biggest bottleneck for his business.
❓ Questions & Concerns
Very niche business that requires specific expertise. Susceptible to changes in government regulation (good and bad). Not an asset-light operation. Clearly, a lot of due diligence is needed.
You can view the listing on MicroAcquire.
__ __ __ __ __ __
LegalTech Tool - $78k
For sale is a 1-year-old LegalTech business that converts deposition transcripts into cross-examinations using AI. Not profitable.
Competitors: LegalMation, Luminance
Tech: GPT-3, AWS
Priced at $100 per deposition; $9M TAM;
TTM Revenue: $26k; Asking: $78k;
✅ What I Like
As a co-founder of a LegalTech business, I have a soft spot for these listings. This startup has some minimal traction. Founded by an attorney who knows the industry. Could be an interesting project for someone to take over.
❓ Questions & Concerns
You’re trying to sell a productivity tool to lawyers. GFL! 😂
You can view the listing on MicroAcquire.
🕸 Content/Service/Other
Travel Guide Newsletter & Website - $20M
For sale is a 4-year-old modern travel guide for users to discover new destinations.
Competitors: Renee Roaming, Conde Nast Traveler
Tech: Ghost, WordPress, Ongage, AWS, Adbridg, Kibana, Airtable
4M e-mail subscribers; 100k daily website visits;
2-3M daily e-mail sends; 50k - 100k daily e-mail clicks; $38.81 RPS;
Monetized through advertising;
TTM Revenue: $3.2M; Profit: $2.54M; Margin: 79%
Asking: $20M; Multiple: 7.87x
✅ What I Like
Really interesting media business. The ~5% CTR is pretty good for a list of this size. Low operating costs lead to high margins. A lot of opportunities to grow revenue further by introducing an e-commerce component, a paid community, and more.
❓ Questions & Concerns
For an e-mail business, you have to determine the quality of the e-mail list and verify engagement. Tech stack is key as sending e-mails at that scale is not simple. Inbox deliverability directly impacts revenue. How are subscribers acquired and for how much? Who manages content? This requires an experienced operator who knows this type of business model. The valuation seems elevated. Here’s a somewhat related discussion around this topic…
You can view the listing on MicroAcquire.
__ __ __ __ __ __
Detention Systems Integrator for Govt - $3.6M
For sale is a 7-year-old business that provides turnkey safety and security solutions for corrections, detention, and homeland security facilities.
Multi-year service agreements with US govt entities
A growing portion of the revenue is recurring
19 employees; Personnel will stay on with the new business owner
TTM Revenue: $5.6M; Profit: $1.0M; Margin: 18%
Asking: $3.6M; Multiple: 3.60x
✅ What I Like
There’s a natural moat around GovTech businesses. Very large TAM. Low client churn. Opportunities to expand to other markets.
❓ Questions & Concerns
Why is the margin so low? How easy is it to hire employees in this business? What’s the strategy to scale? This business may not have a lot of pricing power. What % of revenue is recurring and what’s the strategy to increase it?
You can view the listing on BizBuySell.
🛠 Tools & Resources
I want to share some tools & resources that I have found helpful. Please note that some of these may contain affiliate links. This means that I may receive compensation if you sign-up and use them.
Cerebro Capital - Cerebro has a network of 1,500+ lenders who can provide debt financing for your acquisition, refi, etc. $500k minimum.
X5 Deals - Proprietary deal sourcing. They do the outreach and send you relevant, actionable deals directly into your inbox.
Curators - Proprietary deal sourcing. You need targets that fit your investment criteria, and Curators delivers week after week - we even update your personalized database on a daily basis with new information on best-fit targets.
BizNexus - Proprietary deal flow, deal aggregator, and exit prep. Local Boston company and I consider the founder (Adam Ray) a friend.
PrivSource - Deal aggregator for lower and middle-market listings.
Kumo - Find every deal in one complete platform. Spend less time sourcing deals and more time closing them. Kumo aggregates 180K+ business listings into one easy-to-use platform.
ProjectionHub - Access to 50+ CPA-developed financial projection templates. 25% discount using code “duedilio” at checkout.
Logology - Best automated logo & brand identity tool I’ve come across.
DeepBench - Access a cutting-edge expert network. $200 discount.
OpenPhone - The best VoIP phone solution that I have found. I use this for DueDilio. You get a $20 credit if you sign-up.
Eloquens - Knowledge marketplace. I’ve purchased a few templates from them.
Deal Flow Scout - Peer-to-peer deal flow exchange. Free, open, transparent.
Deal Sourcing Guide - A directory I put together of online marketplaces, brokers, DFY deal flow, and more.
That’s all for this issue of The Business Inquirer!
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