Our very own Brant Bukowsky was recently interviewed on Mixergy. Enjoy!
Our very own Brant Bukowsky was recently interviewed on Mixergy. Enjoy!
After being featured in Inc. Magazine in May, we were lucky enough to again be featured in an article on providing services for equity in Entrepreneur Magazine. This concept must be catching on!
This article focuses again on our relationship with Soccer Pro and how we were able to help them grow from a mom and pop soccer retailer in Columbia, MO to a nationwide online leader in soccer equipment and apparel.
Let us know what you think or if you have any questions since there’s no good commenting setup on Entrepreneur‘s website.
We’re extremely excited to write that Growth Partner was featured in the May issue of Inc. Magazine! The article centered on our relationship with Soccer Pro, an online soccer retailer who was our first Growth Partner deal. We wrote a case study on Soccer Pro on our partnerships page.
Jim’s pretty much the de facto face of the personal finance blogging space and has made numerous press and television appearances (big dog places like the New York Times and ABC).
We talked to Jim about how he built Bargaineering and he gave some great insights on how aspiring blog moguls should think about growth and monetization.
Have a listen and let us here your thoughts!
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The Beginnings
Hard Work
Going Full Time
Guest Posts
Site Design
Monetization
)This week we had the pleasure of talking to a local entrepreneur by the name of Brain Null. Brian is based here in Columbia, MO and originally hails from St. Louis. He’s a well known domain investor and has at one time or another owned gems such as OfficeSupply.com, GolfCourses.com, and RestaurantReviews.com. He was also involved in the acquisition of many premier domain names such as Hockey.com and Dance.com.
Brian’s current project is MO.com. His goal with MO is to create a comprehensive online entrepreneurial destination. Johns Wu, of Bankaholic fame, recently came aboard and Brian surely has lots of other great partners in the wings. Be sure to check it out.
Have a listen and let us know what you think!
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Brian’s Background
Starting on the Web
OfficeSupply.com
GolfCourses.com
State of the Industry
MO.com
I had the opportunity to interview a successful entrepreneur by the name of Shane Pike this past week. Shane is the former co-owner of NursingJobs.org. He and his partner sold the site to Internet Brands in 2008. He regularly blogs on Ask Shane and is a mentor to many successful online entrepreneurs.
Our conversation is pretty much informal chatter on my part–I’m an interviewer newb!–but Shane is excellent and dispenses lots of great advice and “insider” tips for small to mid-sized internet entrepreneurs. Let us know what you think by leaving a comment!
Important disclaimer: We’ve never worked with Shane professionally and this profile is in no way meant to pass his success off as something we were a part of. He’s an inspiration to our team and exemplifies the type of entrepreneurs we associate with and aim to help create.
Listen Here:
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Shane’s Background
Competition
Nursing Jobs
Road to the Sale
Closing Advice
Nathaniel and I are big fans of the audio format so we decided to create a podcast for Growth Partner, entitled “Entry/Exit.” Each episode will talk about investing in companies or growing a business (entry) and issues related to selling/leaving/etc. a current business (exit).
The show is going to be an informal round table discussion between Nathaniel, myself (Brandon), and oftentimes a guest or two. Our first episode gives a little background on us and why we started Growth Partner and we chat a bit about valuing pay per click campaigns when selling a business. Listen to the podcast below and follow along with the short summary under the player if you’d like. Enjoy!
Listen Here:
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What is Growth Partner?
Valuing a PPC Campaign in an Exit
The Definitive Guide to Selling a Website is a series outlining the ins and outs of taking a web business or established website ‘to market’. We’ll show you how to take the proper steps to make a lot of money.
What is the low end?
Anything under $100,000 is a pretty small deal in the grand scheme of things. At this level, you’re not likely to need tons of lawyers pounding out purchase agreements (try something like this instead), nor will you need to spend months bickering on every detail. Often times, buyers and sellers can agree to a deal and do a simple transfer via Escrow.com. This size of deal is sometimes just a domain or a site with no revenue.
Pricing theory
There’s a lot of volatility in lower end website purchases. Revenue is obviously low and tends to be concentrated–coming from a single, potentially unreliable, program like Google’s AdSense. Another issue at this level is accounting related. Most webmasters report profit as simply Revenue – Expenses but don’t include their own labor as an expense. This is a pretty common problem and definitely an issue. Adjusted net profit numbers for small websites can change significantly when accounting for labor–even at a low hourly rate.
Multiples
Predictably, websites in the low end usually sell for a pretty low multiple. Generally, one year revenue or up two 2x net profit would be a pretty reasonable price. This sounds low to many but the problem is the fact that there’s so much uncertainty at this level. Generally, sites for sale under $100,000 aren’t even a real business–they are simply part of something bigger or a sideline for someone. Unsustainable revenues with a relatively short history also come into play here.
Where to sell
The biggest marketplace to buy or sell sites under 100 Grand is Flippa. Be forewarned, the quality of websites for sale on Flippa is all over the place. Some websites are a complete scam and others posted are legit–do strict diligence before transferring any $$$ for a site for sale on Flippa. Beyond that, try business for sale marketplaces like BizQuest and BizBuySell. These sites target pricier listings but due to the mobility of an internet business, websites are likely to generate a lot of interest from people across the country (or world) even with smaller selling prices.
Who might buy your site?
There aren’t many “strategic buyers” looking at this level. A strategic buyer is someone in a related business that acquires you website because of what it can bring to their core business. If you’ve built a solid niche site such as a tool that’s relevant to an ecommerce site or something similar, you might be able to approach some people directly. You would most likely sell your site to another individual (as opposed to a larger company) who probably operates a network of sites for a living/sideline.
Creative Commons photo courtesy of amagill.
The Definitive Guide to Selling a Website is a series outlining the ins and outs of taking a web business or established website ‘to market’. We’ll show you how to take the proper steps to make a lot of money.
One of the most exciting parts of being an entrepreneur is an EXIT a.k.a. a liquidity event.
Liquidity event = selling all or a piece of your business.
Selling a business is a common path to individual wealth. (There are other terms for “selling”, i.e. refinancing, selling partial ownership, and so on. These all fall under the category of a liquidity event.)
Many people say real estate is where the wealthy keep their net worth… well, selling a business is where they earned that net worth.
Selling Your Website or Web Business
Selling your website may not necessarily make you a millionaire, but a liquid six-figures or more sure sounds like a nice shot in the arm, eh?
Especially if your website is a sideline to a day job, that amount of money could allow you to become self sufficient and work on growing businesses that you own, day in and day out.
The sale itself isn’t making you rich in many cases, but it’s sure affording you the opportunity to have a better shot than most!
Our Experience
From our experience, there are a few categories of internet business sales. We’re not VC-backed, Silicon Valley hippies, we’re just a group of hard working entrepreneurial marketers that build real businesses on the web. We’ve had 2 successful exits and created many more sustainable businesses online.
That’s where we’re coming from.
On that note, our numbers may reflect “regular Joe” dollars. The fact is – the vast majority of internet businesses are sold in the sub-$5,000,000 range and this area is really our sweet spot.
Here’s the deal sizes we’ve had experience with and I’ll delve into more deeply in this series over the coming weeks:
Low End – Sub $100,000
Middle Market – $100,000-$2,000,000
“Big Deal” – Over $2,000,000
This represents our experiences and what we’ve learned over the years. It is NOT necessarily representative of anyone else’s experiences.
Many business owners have negative opinions of online marketing ‘consultants’ because they work in a flat-fee relationship.
It’s our opinion that businesses are much better off working with a team that is paid on performance only. Particularly through an equity stake or sharing of revenues.
Here’s Why
In many flat-fee consulting arrangements, it goes down like this:
You hire RealCoolSEO for $2,200/month. They come in and clean up some title tags, suggest re-doing your internal link structure, and queue up 25 blog links they use for every client.
This takes about 1 day of work. RealCoolSEO is on cruise control from here on out. A few reports per month, a few more blog links to keep your mind at ease. Just enough to keep that monthly check coming in.
The flat-fee consultant’s incentive is slim. The only way for them to make more money is to get more clients like you, which means their best people are off trying to get more clients. You’re working with the maintenance man. The day-to-day.
Any growth in revenues you see from this arrangement is going to flatline sooner or later.
Your Monthly “Fee” Should be $0
The best partners for your business don’t want money up front. The best partners have a vested interest in your growth. Only when you get paid, should they get paid.
Only then will they take an active interest in your business.
A successful online marketing campaign requires constant attention to connect a service to a customer.
You want links? Constant. Branding? Constant. Conversion optimization? Constant testing. Email marketing?
This is not a “set it and forget it” world, no matter how much the ease of the internet makes it appear so.
The best ‘consultants’ understand this. They will dig into your Facebook account and see how your customers talk. They will sit in on Board meetings and learn every aspect of how your business functions.
Takeaway
Forget about paying a monthly fee. Start thinking about what % of 10x in revenues you’d be willing to share with the right partner to make it happen.
Internet Entrepreneur & Investor, co-founder of Growth Partner
Search Marketer & Domain Investor, Managing Partner of Growth Partner
