The Business Inquirer #105
In this week's issue, I highlight four listings including two newsletters, a dropshipping store, and a Notion add-on.
The Business Inquirer covers the most interesting business acquisition opportunities. Written for entrepreneurs, search funds, investors, and business owners.
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Hello Friends!
In this week’s issue:
🛒 eCommerce - 1 listing
☁ SaaS - 1 listing
💼 Service/Media/Others - 2 listings
🛠 Tools & Resources
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🛒 eCommerce
Commercial Lighting Dropshipping - $240k
For sale is a 7-year-old commercial lighting DTC dropshipping business.
Products are sold DTC through five e-commerce websites
$1,000 AOV; 88% of website traffic is organic;
3 owners run the day-to-day; SOPs in place;
TTM Revenue: $704k; Profit: $64k; Margin: 9%
Asking: $240k; Multiple: 3.75x
✅ What I Like
There’s a good amount of operating history. Most clients are B2B. I like that there was a strong focus on SEO from the beginning. I’m a fan of the dropshipping model due to its simplicity and low CAPEX. Good for first-time online business owners. There may be an interesting opportunity to move away from dropshipping to increase the margin. High AOV. Not confident about this but I assume that there aren’t too many points of failure in a lighting product which means there are fewer returns.
❓ Questions & Concerns
You have to understand what you’re buying with a dropshipping business. The key assets include brand name, customer acquisition strategy, and suppliers. The products are likely not unique or differentiated. I would try to understand why there are five e-commerce websites instead of just one? There are three owners who operate the business plus a few contractors. It seems like a lot of bodies for a $700k e-commerce business but I may be wrong. Is the profit figure shown after everyone gets paid?
Here’s how I would do the basic diligence on this business:
Analyze website traffic - sources, consistency, conversions, and ROI
Confirm the P&L including all revenue and expenses
Assume all employees quit tomorrow - how much are you spending to re-hire?
Review contracts with suppliers. Review customer service and return policies.
Does the business have client reviews?
Seller Force is a division of Website Closers brokerage. They have a reputation for not vetting their listings so a lot of due diligence is required here.
You can view the listing on Seller Force.
☁ SaaS
Notion Widget Maker - $15,000
For sale is 1-year-old Actions.so, which is a widget maker for Notion. Users are able to create CTAs, buttons, tracking tasks, and data visualizations through the Notion API.
42,000 users on the basic free plan; 300-400 new signups each month;
1,500+ unique website visitors per month
Asking: $15,000
Note: I don’t have premium access to Tiny Acquisitions so I don’t have the revenue numbers for this business.
✅ What I Like
Notion is a wildly popular note-taking, project-management, website-building, and workspace tool. This business is tapping into a very fast-growing market with a large TAM. There are over 42k users of this product so I think it’s safe to say that the demand has been validated. The website was made on Webflow and seems well designed.
❓ Questions & Concerns
Young project without a lot of operating history. Are there any paid users or is everyone on the free plan? How many users sign-up and actually use the product? How does this compare to competing products? What type of tech upkeep is required? Why are the owners selling this business now?
You can view the listing on Tiny Acquisitions.
💼 Service/Media/Others
Business Idea Newsletters - $800 - $2,400
Microns.io has a couple of newsletters for sale that send out business ideas to subscribers. I personally view these types of newsletters similar to Page Six or The Daily Mail - mostly full of BS but can be fun to read.
Google search data shows that there is consistent demand for this type of informational product…
I believe that with AI writing tools such as ChatGPT, these types of newsletters are relatively easy to create content for.
Some of my concerns would be around the quality of the subscribers and how to easily onboard sponsors. Can you simply replicate these newsletters for less than the asking price?
Broadly - you really have to be careful with the micro-acquisition space. There are factories abroad that churn these things out. Launch a product, get a few users, sell for $1k-$5k, rinse and repeat. Not saying these are scams but know what you’re buying and why.
Microns - Startup Ideas Newsletter - 1,200 subscribers; Asking $2,400
Microns - Business Ideas Newsletter - 982 subscribers; Asking $800
🛠 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.
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.
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.
The Website Flip - a newsletter that sends content sites for sale to your email inbox. They send deals each Wednesday and Friday.
Logology - Best automated logo & brand identity tool I’ve come across.
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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