8 Reasons Why I Bought THIS Online Business.

If you’ve followed this newsletter for the last weeks, you know that I’ve been in the process of acquiring a business. Welp we closed… about a week ago.

The Deets

• Digital Product; CPE courses for accountants that are accredited (by Nasba).

• 70k/yr profit. Paid 250k.

• 75% cash at close with a 25% earnout based on Udemy revenue.

• 7 years in business.

Here is the brokers listing for it. And here is the original inclusion I made in the Acumen Wire.

At this time I will not be giving away the business name. While this business does have a good moat of quality/accredited products and time in business, publicly sharing the names of online businesses I own has never brought anything ‘good’ and a few headaches.

The business was initially listed for sale in March and I was planning to make an offer but they accepted an offer pretty quick. I was immediately disappointed in a way that I had never felt. After noticing the business was still ‘pending sold’ after 7 weeks I contacted the broker and indicating that I had cash and could close quick. And like that I was back a the table.

A quick word on the negotiation / diligence… it was ‘consuming’ as I didn’t want to embark on any other projects. Had the deal not closed a lot of time would’ve been wasted. I lightly asked why their original offer didn’t close, and was told that they couldn’t get financing and a business partner backed out. I didn’t push it as ultimately it was up to me to uncover any issues with the business.

On that note let’s jump into why I chose this business.

1. Digital Product. As a digital product the whole thing ‘lives’ in the cloud. No inventory, no return shipping, and there is basically $0 cogs for each order. Hence the margin for the business is about 90%.

2. Quality/Moat Product. The courses for the business are well reviewed and they’re accredited by NASBA, so anyone looking to jump in and compete would have a hurdle to get over. It’s not a huge hurdle but it is substantially more than throwing up a Wordpress site and cranking out a mediocre course in a weekend.

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3. Huge, Evergreen Market. This isn’t a trendy fidget spinner business. CPAs have annual CPE credit requirements, and that will never change in my lifetime.

4. Stable revenue / profit. The numbers aren’t rocket-shipping upwards, actually they’re in slight decline, but this has held out with very minimal seller involvement. They seller has really let this business stagnate.

5. Time in business. 7 years of customers, and domain age (this gives an incredible foundation for SEO). Hello re-engagement campaigns.

6. I Like The Niche. My undergrad degree is in accounting, and I am an accounting/finance person by nature. I can understand the material, I know what is good/bad product and I’d much rather be consumed with this type of content/product that I would something in the arts & crafts niche.

7. Multiple Channels of Revenue. The business drives a about 50% of it’s revenue from organic Google, while the other 50% comes from Udemy. Not a one trick pony.

8. Not Online Biz Person Owned. Although last, this is quite possibly the most valuable. Businesses that are owned but an ‘online business person’ are often well built out and look robust, but they’ve done everything that I could/would do. The seller of this business was not an ‘ebiz genius’ and clearly was consumed with his job in finace and family. This means Easy Wins.

With the business in my hands, I’ve got my work cut out to grow it, albeit from a strong foundation. I’ve already crossed off the first easy seo win, moving to a fast server and passing Core Web Vitals.

It’s a beautiful thing.