On this show I speak with Thomas Smale of FEInternational.com.
Thomas is a serial online business entrepreneur and expert. In his early 20s, he began building and selling small online companies. This turned into a full-time career when he founded FE International in 2010, growing the business with zero funds from ground up and consistently doubling annual revenue, as well as the average deal size. Thomas specializes in advising in the M&A of SaaS, e-commerce, affiliate and content businesses. He has consulted hundreds of internet entrepreneurs on exit strategy, growth and business development.
I’ve actually just successfully sold a site through FE International and can vouch for their process – details to follow in a standalone blog post.
Discussed on this episode
- Is it a sellers market or buyers market?
- New buyers coming in from investment banking, private equity groups and real estate coming into the space – more money than was 5 years ago
- Multiples are increasing every year and will inccrease faster when people are able to leverage against other assets. Not many people have $100k in cash to spend. Cash rich are in a great position to pick up businesses when they are 3x net annual profit and wait for valuations to rise. Check out the Centurica Website Buyers Report
- Will online business always be seen as a risker asset class. Online businesses can be funded by Small Business Administration loans in the US. Will banks ever loan against them? Banks normally take 2-3 months to get financing so waiting for it will likely mean you’ll miss out on a deal. Some companies will lend against SaaS MRR or purchase orders against ecommerce businesses.
- Best business to start first if looking to sell is one that leverages your existing skills set