The Business Inquirer - #9 (12/28/2020)
In this week's short issue I highlight a lead gen business 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.
Join The Business Inquirer Facebook Group.
Hello Friends!
In this week’s short issue:
Happy Holidays!
Marketplace - Lead Generation for Moving Cos
What I Learned Last Week
Happy Holidays!
As this is the last newsletter for 2020 I want to wish everyone a happy holiday season. For 2021 I wish you much wealth, health, and happiness!
I’m doing some planning for 2021 and thinking through ways I can add more value to you. I’d love for this to be a collaborative process. Simply hit reply and let me know how I can most helpful. Share any thoughts (positive or negative) you have about the newsletter.
What are you working on? I’ve had some great interactions with readers and have made a few connections which I think have been helpful.
Finally, I want to share a small gift with you. I’ve created a Dropbox folder which contains 3 book summaries. The summaries are of Traction, Never Split The Difference, and Start with Why. Each PDF is a quick summary highlighting the main takeaways from each book. Not a substitute for reading the full thing but a good start. These are three books which I found helpful over the last year and I hope you will find them interesting as well. You can access them here: Book Summaries
Cheers!
Marketplace - Moving.biz Lead Generation (Asking: $205k)
Description
For sale is Moving.biz which is a lead generation business for nationwide moving companies. The business owns several domains and generates leads through Google PPC campaigns. Seller is CTO/Partner in an 8-figure ad-tech company and is selling his smaller assets to focus on the larger business full-time. Listing is very detailed with a lot of great info.
Details
Seller purchased business in 2015 and revamped it in 2016
Flagship brands include Moving.biz, MovingLead, MovingOrbit, LeadGrab
Leads generated through Google PPC campaigns
Custom-built, proprietary technology used to capture and distribute the leads
Leads sold to moving cos and other lead aggregators
TTM Revenue: $340,756
TTM Profit: $82,991
Profit Margin: 24.4%
Asking Price: $205,000 BIN: $275,000
Profit Multiple: 2.47x
🤓 Why I’m Highlighting This Business
I’ve always been curious about the details of these types of lead-gen businesses and this listing provides great insight into the business model and operations. For me, there’s a lot to learn here. I think this same model can be applied to other service verticals which have high-ticket pricing. Some verticals that come to mind include accounting, legal, home theater installation, home security installation, car dealers, wealth management, IT management, apartment rentals, loan brokers. Besides the educational aspect, I think the listing itself is interesting for purchase. Would be a great purchase for an experienced online marketer or someone with an adjacent business.
People search for “moving company” 24k times per month with a CPC of $23.23…
✅ What I Like:
Evergreen niche
Fully automated business. Just requires monitoring the PPC campaign
Many ways to add revenue streams to existing model
Seller can stay on as consultant/adviser after the sale
Business has moat/barriers to entry
Not a lot of competition
Valuation seems reasonable
❌ What I Don’t Like:
Moving business has seasonality
Single revenue source which is dependent on movers ad-spend
Requires a dev to keep the technology running
🚀 How I Would Grow This:
Expand lead capture to Bing, Facebook, and other platforms.
Implement a content marketing strategy to acquire leads for free.
Add affiliate marketing revenue to the business. People seeking to move also require many other services/products.
Expand to other adjacent verticals such as car transport.
You can view the listing on Flippa.
🧐 What I Learned Last Week
Highlighting VC & startup content
SandHill.io recently launched as an MVP from Ali Afridi. The goal is to help readers find and reference the best content around building and investing in new tech ventures. The website aggregates content from 190+ VC & startup-oriented writers in a single feed and shares a digest of a selection of the top posts each week in a newsletter.
——
SBA business loan eligibility
I’ve been doing some research on SBA loans and came across SBA7a.loans (yes, that’s a .loans domain). They have a very clear outline of the requirements to be eligible. For those unfamiliar, and SBA loan is a small business loan that is guaranteed by the federal government. Since it’s guaranteed, it is easier for lenders to lend money to riskier, small business ventures.
Eligibility Requirements
You must be officially registered as a for-profit business, and you must be operating legally.
As the business owner, you can’t be on parole.
Your business must have fewer than 500 employees, and less than $7.5 million revenue on average each year for the past three years
Your net income must be under $5 million (after taxes and not counting carry-over losses), and your tangible net worth must be less than $15 million.
You must show you’re investing your own time and money into the business, having “invested equity.”
Your business must be physically based in the United States, and you must be doing business with the U.S. and its territories.
Your small business must be in an SBA-eligible industry (speculative, illegal and non-profit businesses don’t get to play). Learn more about Eligible and Ineligible Industries for SBA 7(a) Loans
You’ll need to show that you’ve already tried and failed get funds from other financial lenders, fully exhausting non-SBA loan options.
You’ll need to prove you’ve got a sound business purpose for the loan you’re requesting, and that your intended funds usage is approved by the SBA.
You’ll need to prove you’re not delinquent on any existing debts to the U.S. government (taxes, student loans).
Additional Beneficial Business Qualities
In addition to the eligibility requirements, there are a few additional qualities which can increase your likelihood of SBA 7(a) loan approval.
A good credit score - preferably above 680.
A history free from recent bankruptcies, foreclosures, or tax liens.
Having been in business for at least two years.
The ability to provide collateral for loan requests over $25,000.
The ability to make a down payment of 10% if your intended use of funds is to purchase a business, commercial real estate, or business-related equipment.
Sufficient cash flow to meet your debt obligations.
Sufficient working capital (once you subtract liabilities from assets).
“Good character” according to the SBA (partially decided based on your track record of managing your resources and day-to-day business affairs).
You can view the full list of requirements on their website.
——
That’s all for this issue of The Business Inquirer!
I wish everyone a very safe, healthy, and happy holiday season. Much success in the new year!
If you enjoyed reading this newsletter, why not share it?
As always, please don’t hesitate to contact me with any questions, comments, or feedback. I also check all comments in the web version of this newsletter.
Let’s connect: LinkedIn, Twitter
Join The Business Inquirer Facebook Group.
Important Disclaimer: This newsletter is provided for informational & educational purposes only, and should not be relied upon as legal, business, investment, or tax advice. This newsletter may link to other websites and certain information contained herein has been obtained from third-party sources. While taken from sources believed to be reliable, it has not been independently verified. The Business Inquirer makes no representations about the enduring accuracy of the information or its appropriateness for a given situation. References to any companies, securities, or digital assets are for illustrative purposes only and do not constitute an investment recommendation or offer to provide investment advisory services. Charts and graphs provided within are for informational purposes solely and should not be relied upon when making any business, tax, or investment decisions. Content in this newsletter speaks only as of the date indicated. Any projections, estimates, forecasts, targets, prospects and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others.