2024.11.10 - Online Biz Acquisition Opps

Happy Sunday peeps.

In going through the listings, I found a bunch that seemed decent when I first crossed the headline, but as I read more, things just went down hill.

So we’ve got 1 decent business here, followed by 5 ‘interesting but not for me’.

The decent business here is in the supplement space, which I’ve never really been interested in as the products seem to be very ‘buzzy’, in other they take off and scale high but then die out. Perhaps I am wrong about that as there are lot of people out there that have made a ton in the supplements ecom space.

If you have experience in the supplement space, let me know.

// Nutritional Supplement Brand with High Recurring Revenue | 3.5x Multiple

💰 Asking Price: $5,140,000
📊 Gross Revenue: $3,478,733
💼 Cash Flow: $1,467,443
📅 Established: 2019

Overview:
This premium supplement brand has built a strong customer base with proprietary products and a 61% recurring revenue stream. Operating with a 3PL, it achieves a 39% net margin and 60% YoY growth. While supplement brands are known for consistent sales, they can often be trend-dependent. This brand’s performance, however, is heavily tied to Facebook advertising, which a skilled buyer could diversify across additional channels to strengthen stability.

Highlights:

• Proprietary Formulas & High Recurring Revenue: 61% of revenue comes from subscriptions or repeat buyers.

• Efficient Fulfillment Model: 100% 3PL managed, minimizing overhead and operational complexity.

• Premium Market Position: Average order value of $100 and high LTV with a dedicated customer base.

• Heavy Reliance on Facebook Ads: Currently dependent on Facebook, creating an opportunity for an adept buyer to expand to other platforms.

Questions:
❓ Are there risks associated with the brand’s dependence on Facebook ads, and how prepared is the business for diversification?
❓ What product development or expansion opportunities exist to build on the current SKU lineup?
❓ Given the market’s competitive nature, how sustainable is the brand’s current growth trajectory?

View Listing

Interesting But Not For me….

These deals looked good at a glimpse but after reviewing the listing their was glaring red flags in my opinion.

// Career Change Training Programs. 1mm SDE, Asking 3.5mm. 3.5x Multiple

The title reads well, and the multiple on the SDE is nice, but as I read it, it seems to be some type of life coaching type of thing which I find very gimmicking. The seller also adds “The company is just waiting for you to help it grow and multiply its revenue/profit by 2, 3, or even 5 times each year” — which sounds like straight baloney. And then I see it was only started in 2024. It seems like seller has found a nice money gab and wants to cash out before it collapses.

View Listing

// Distressed Patent Food Containers Ecom. 515k SDE, Asking 1.5mm. 2.8x Multiple

Has patented products. Strong social. Multiple sales channels. Distressed position, owners invested heavily in r&d of new product but do not have the funds to launch it.

I don't a see a 2.81x straight buyout happening here at all.

The bull case: this business has innovative and value add patents. You inject capital and structure some type of earn out to keep the sellers involved.

The bear case: the patents are just an 'alternative' design and really add no value.

There may be some good upside potential for the ‘deal maker’ type of person, but personally I don’t feel like dealing with business partners for a 15% ecom business, so Im out.

View Listing

// Holistic Brand Online Training & Ecom. 184k SDE, Asking 600k. 3.2x Multiple.

Let’s start with the product, meta physics education and artisanal crystals. That’s too much astrology for me. But it is doing 600k in revenue with $309 aov, for 15 years and is SBA eligible. Maybe I’m the sucker?

View Listing

// Remote Staffing agency. 120k SDE, Asking 600k. 5x Multiple

These businesses can have high scale and great margins, but they’re very susceptible to competition (no barriers to entry). 5x is way too high. 2.5-3.5 is realistic.

View Listing

// Online Marriage Service. 60k SDE, Asking 159k. 2.9x

Not exactly sure what this does. 35% margin and less than 3x multiple is attractive. But it’s small, has 7 employees (high for relatively low revenue), and can’t say I find the industry appealing.

View Listing