Fastlane Success (8 figure exit!) - Now Back to the Starting Ground !!

[Drups]

Wow 30 employees is crazy. We had 3 handling our entire operation. What are the roles of all the 30 people there? Your payroll must be huge if they are all in-house.

4 marketers
1 Graphic designer
1 product developer
1 customer service
1 wholesale
2 operations managers
2 warehouse managers
10 warehouse employees
Executive assistant
2 Admins/e-commerce support
Me
1 PT does custom CAD and patent designs
1 PT graphic designer
2 temps for seasonal labor
Plus or minus 1-4 depending on the season.
I’m working on getting the whole operation to run without me. Currently I work remotely and I’ve been working myself out of the operations.

 

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[NeoDialectic]

4 marketers
1 Graphic designer
1 product developer
1 customer service
1 wholesale
2 operations managers
2 warehouse managers
10 warehouse employees
Executive assistant
2 Admins/e-commerce support
Me
1 PT does custom CAD and patent designs
1 PT graphic designer
2 temps for seasonal labor
Plus or minus 1-4 depending on the season.
I’m working on getting the whole operation to run without me. Currently I work remotely and I’ve been working myself out of the operations.

@fastlane_dad & @NeoDialetic,
Thanks for sharing your story! I’ve got an FBA. Business with around 30 employees. I’ve scaled to my current revenue through acquiring and merging 6 smaller brands in the e-commerce space.

Congratulations on your success! It looks like a big part of our employment differences had to do with how much you decided to do in-house versus contracting. We outsourced everything that we could to 3PLs, graphic designer contractors, customer service centers, etc...

As long as you are OK with managing an army of employees, there are many benefits to having in-house employees. It's no coincidence that most large businesses have large payrolls.....

You seem like you’re about 3-4 years ahead of me as far as where I’d like to be at an exit given our current growth rate. I’d love to hear more about what you’re suggesting for maximizing value at an exit. What do I you wish u you ou would have known going into selling a business?

We have a whole series on selling our business that we have had on the back burner to finish. But I'll add a few things that come to mind.

Your valuation will be roughly based on your profit multiplied by a multiple. So the most important thing in your valuation would be your profit. I'm guessing you are already trying to maximize revenue/profit, so not much info there. So most your work will be on the multiple side of things. They will most likely look at your last 2 years. The most important factor for your multiple will be that the profit trend line has been increasing over the last 2 years.

So depending on how your business is run, you may want to strategically deploy advertising campaigns during the last year. Or if you know certain times of year are better, timing the exit to match with that. Investors know about seasonality, so it's not a huge variable as they will take that into account. But the line going up is the equivalent to "curb appeal" when buying a house.

Next, you want to make sure nothing shady or sloppy is going on in your business. Especially during those last two years. Are your employees all above board? Is everything being done by the books with payroll and/or management? Are you running any iffy marketing campaigns? etc..This is increasing liability for the investor. So while you will find interest in your business no matter what the answer to these questions are, higher liability will mean a lower multiple.

Decrease dependencies. MJ's not the only one that knows not to violate the Commandment of Control! If 100% of your sales are on Amazon, you are at their mercy. If you could take 20% of your customers off Amazon and onto your website, that would be a big deal.

Then there are a lot of things that may not affect your valuation but will give you ammo during negotiations. I.E having a lot of customers signed up on your email list could be a powerful tool for the buyer to utilize not just on your products but other businesses they may have. It's your job to point out that the brand X they already own would be a perfect fit for your customers. As luck would have it, you have a list of customers that are just waiting to be given a coupon code for that type of product! The day they buy your company, will be a fantastic day for their other brand X!

Have you thought about acquiring a business for your next play rather than starting from scratch?

We have been looking around and thinking about buying a business. We haven't found the right one for us yet. Our motivation for buying a business is less about the passive income and more about the skills and knowledge we can learn from taking over a business in a different field (and marketing strategy).

 

[Fernandezg]

OK so there's a lot to my story - my journey and how it all happened (I'd be willing to share if there's any interest) - but long story short I have recently achieved the pinnacle of the 'fastlane journey' - selling my online business a year ago and amassing a low 8 figure net worth.

This was not a 'get rich quick' story either as this took the better part of the last 15 years to begin my entrepreneurship journey full time, and eventually build a business to the point of sale a decade later. I was working a full time corporate job (with my slowlane degree!) prior to embarking on this wild ride. I quit at 25 years old, and never looked back again or had a boss since that lovely July day. There were MANY failures, trials and tribulations along the way. If you want a 'process' and not an 'event' ---> I am no better example of that.

I am now at a point of figuring out what the best next steps forward are. Some of the things I have started working towards is thinking about starting another business for fun rather than just profit (orienting it closer towards a passion), currently investing the proceeds of the business sale, and gauging if there are other values to chase in this lifetime vs. the constant pursuit of building / scaling / selling businesses and building wealth for wealth's sake (once you figure out your 'enough').

I am late 30s with a small family (one child) and *think* I have close to enough to make my money last until the day I die, so pursuing extra wealth through hard work and additional sacrifice is becoming less and less appealing with each passing day. I have experienced all the exotic rides, dream vacations, top restaurants and parties (all responsibly of course) and many of all the other luxury goods we all aspire to. While great in its own right, and was a lot of my motivation from the get-go -- much of that has lost its charms on me over the years.

Additionally, I am looking forward to merging my life towards providing value to any/all that want help with business advice in any facet. My schedule is open now (as I consider myself partially retired) and I am open to mentoring / coaching anyone who is interested in entrepreneurship, scaling a business or just thinking of ideas / niches to pursue.

I haven't participated much on these boards while pursuing my entrepreneurial journey but am at a point now where I have the time, motivation and willingness to engage in helping others achieve 'the dream.'

In a way I am now back to ground zero - and yes, even though the pressures of day-to-day paycheck are further beyond me, I am in many ways faced with the same but different constraints that I was bootstrapping and growing a business, or trying to figure what is it now that I'm 'optimizing' for.

I am very conservative in my investments as well, so having money does not automatically enroll you in some special club where now 'making money' becomes much easier (in facts sometimes its the opposite when you are afraid of losing it all).

For those wondering how I made the bulk of my money it was through various e-com ventures, latest being an Amazon FBA business that led to an exit. The 'process' took me the better part of the last decade (the Amazon business actually was started exactly a decade ago this month!) - but I have been entrepreneurial in various facets since the age of 14.

While I haven't hit all the tenets of CENTS with my last business (primarily violating control and entry) - the rest of them were hit right on the mark to make it a success.

I'm still learning and browsing these forums weekly but will plan and contribute more as time goes on!

What a great story of success! Thank you for sharing and thank you for offering your mentorship. I figure I will need mentorship one of these days, thank you for offering.

 

[Two Dog]

You know several hundred millionaires? ‍

Well, it turns out when you want to raise money, it helps to know people who actually have money to invest.

First company I worked for IPOed after five years. Quite a few right there. Later in life, I spent several years helping tech startups raise money pitching to angels and VCs. Attend lots of conferences and events attended by dozens or hundreds of accredited investors and the names add up pretty quickly. Same thing doing RE with private investors, hard money lenders, business brokers, etc. Same thing with helping small biz owners raise money through private placements.

Didn't say I was dating their daughters. I said "knew them".

 

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