Like real estate syndication, we pool investor capital and buy an e-commerce business with a clear plan to exit after three years.
In business, syndication combines resources from multiple parties, such as financial institutions or investors, to fund a specific project or investment opportunity.
Syndication finances large-scale projects, including real estate developments, movie productions, or startup companies.
The best price range to acquire these e-commerce businesses is in the mid-six to low seven-figure range ($350,000 to $2,000,000).
These businesses are well-established, have lower risk, and we identify clear growth opportunities compared to micro businesses and bigger middle market businesses.
The costs to manage these bigger businesses are a lower proportion of revenue than sub $500,000 businesses, allowing us to allocate extra resources to scale them and make them much larger.
We can sell them to strategic acquirers for much higher multiples once we have crossed the $500k EBITDA barrier with an SBA loan.
Most deals we do are private, through our network, and unavailable anywhere else.
We break it into a deal structure and explain how we operate things.
These are set up via a Delaware LLC, where the ownership will be proportional to the equity investment size.
As sponsors, we will also contribute 5% to 20% of the acquisition cost and will be the manager of the LLC/C-Corp.
Investors are not required to be accredited; the minimum investment check is $100,000.
Once investors receive 100% of their investment, 50% of the upside will be distributed to the operator.
Some business owners need help operating the business and preparing it for sale. This can fast-track an acquisition to an SBA-approved lender in less than 18 months.
We evaluate the business and decide on the current valuation at 2x. Example $300,000.
We make a plan to exit the business and sign the engagement fee (5%), $15,000.
We take over operations with a minimum of $5,000 monthly for our operational team and $1,000 monthly for our finance team.
We operate the business and sell it for $1,000,000.
We split the upside with the seller:
Got questions? We’ve got answers. Explore our FAQ section for quick insights. It’s a treasure trove of solutions for common queries from our community. From services to orders, find what you need to know.
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Aliquam vel molestie diam. Duis ultricies vestibulum nisl. Etiam egestas nisi volutpat tellus varius, a congue nibh tempus. Vestibulum dictum, dolor non tincidunt varius, mi diam pretium nulla, vitae faucibus ante nulla id nunc.
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Aliquam vel molestie diam. Duis ultricies vestibulum nisl. Etiam egestas nisi volutpat tellus varius, a congue nibh tempus. Vestibulum dictum, dolor non tincidunt varius, mi diam pretium nulla, vitae faucibus ante nulla id nunc.
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Aliquam vel molestie diam. Duis ultricies vestibulum nisl. Etiam egestas nisi volutpat tellus varius, a congue nibh tempus. Vestibulum dictum, dolor non tincidunt varius, mi diam pretium nulla, vitae faucibus ante nulla id nunc.
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Aliquam vel molestie diam. Duis ultricies vestibulum nisl. Etiam egestas nisi volutpat tellus varius, a congue nibh tempus. Vestibulum dictum, dolor non tincidunt varius, mi diam pretium nulla, vitae faucibus ante nulla id nunc.