Looking to sell my company. Any advice on posts to read?

[pro]

You will have to sell it yourself as the deal size is too small for most people to be interested.

"I'm my only sales person and I run the entire team by myself."

Without you the business seems like it would slowly fade. It doesn't seem like a fastlane business as the growth rate potential doesn't seem to be there.

 

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[jon.a]

He said it's a web development company.

Read and devour built to sell. It will give you a new perspective on your business. I have a feeling, that if it's a service based business, your business will be difficult to sell. But, that doesn't mean you can't get it there.

Good luck!

Does that mean he builds websites?

 

[Ultra7]

I mentioned it above.

Its certainly not rocket science. But you need to have the right formula.

Unless I missed it, you haven't been very transparent as to what the business does. Is this because it could be replicated for far less than you're hoping to cash-out for?

 

[Ultra7]

A bit more to what we do than this. Not looking to give out too much info.

Does that mean he builds websites?

 

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[Aivix231]

You will have to sell it yourself as the deal size is too small for most people to be interested.

"I'm my only sales person and I run the entire team by myself."

Without you the business seems like it would slowly fade. It doesn't seem like a fastlane business as the growth rate potential doesn't seem to be there.

If someone buys his bussines im sure he knows the risk, if their bussines falls , it isnt OP's fault!

Same happened with MJ , he sold company and it faded away, was it his fault ? NO !

When its sold its sold and seller dont take responsability if new owner just lose all bussines. Thats how it should be.

 

[Ultra7]

Been a year or so since I posted. I tracked all the expenses, etc, for 2014 and would appreciate any feedback on what you guys think the company is worth? Here are the numbers:

Total gross profit in 2014 was $480,938.95
Total expenses for 2014 $131,492.00

Net profit for 2014 is $349,446.95

Thanks in advance!

 

[pro]

Ultra7,

It could be worth $0 and it could be worth $1 billion based on the above.

Many other factors can change the valuation like:

• Debt/liabilities
• Quality of earnings
• Seasonality
• Regulations/lawsuits
• Contractual obligations
• Customer base
• Inventory
• Equipment
• Real Estate

Also there's multiple valuation models. The only thing that matters is what buyers offer you.

If you don't know how to sell it yourself, you can get a broker to assist you if you think they can do a better job selling it for you but expect to pay up to 12% based on this deal size

 

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[randomnumber314]

Been a year or so since I posted. I tracked all the expenses, etc, for 2014 and would appreciate any feedback on what you guys think the company is worth? Here are the numbers:

Total gross profit in 2014 was $480,938.95
Total expenses for 2014 $131,492.00

Net profit for 2014 is $349,446.95

Thanks in advance!

Okay...what was % growth year over year, last 5? What role do you play in the operations--is it "turn key?" (god I hate that term)

Let's back up from this and think of it as though I approached you as a seller. I have a business that does $30k a month, do you want to buy? What questions would you ask me, and how would I sell you on it?

It's all about proving the value in sale to the buyer. You could get $100m or $100 yen depending on how you sell it. All that matters to the buyer is the money I pay to buy it worth the risk? Sounds like you've spent a year trying to sell, and I wouldn't touch it with a ten yard stick.

 

[FTLane]

So you're saying you went from earning 20-25k a month in 2013 to 40k a month in 2014? The growth rate seems to look decent but there's still a plethora of information lacking to give this business a meaningful valuation. Have you considered contacting an agency to sell your business for you? If you're interested I could help you sell your business for a fee, I have access to a network of people eager to get into online businesses.

 

[Ultra7]

Ultra7,

It could be worth $0 and it could be worth $1 billion based on the above.

Many other factors can change the valuation like:

• Debt/liabilities
• Quality of earnings
• Seasonality
• Regulations/lawsuits
• Contractual obligations
• Customer base
• Inventory
• Equipment
• Real Estate

Also there's multiple valuation models. The only thing that matters is what buyers offer you.

If you don't know how to sell it yourself, you can get a broker to assist you if you think they can do a better job selling it for you but expect to pay up to 12% based on this deal size

Thank you for your feedback. To answer some of your points:

-Zero debt. Only expenses.
-Quality of earnings I would say is pretty high. Chargeback rate is like 1/1000.
-This is not a seasonal.
-No lawsuits. Not a very regulated industry. 100% legal.
-Aside from ICA's for staff and the very occasional NDA, we do not have any contracts.
-Approximately 3,000 clients.
-No inventory.
-No equipment (just need a computer and software).
-No physical office building. Staff works remote.

 

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[Ultra7]

Okay...what was % growth year over year, last 5? What role do you play in the operations--is it "turn key?" (god I hate that term)

Let's back up from this and think of it as though I approached you as a seller. I have a business that does $30k a month, do you want to buy? What questions would you ask me, and how would I sell you on it?

It's all about proving the value in sale to the buyer. You could get $100m or $100 yen depending on how you sell it. All that matters to the buyer is the money I pay to buy it worth the risk? Sounds like you've spent a year trying to sell, and I wouldn't touch it with a ten yard stick.

For growth, the sky is the limit. It would depend on how many more staff you want to hire, if you want to hire sales people, advertise more, etc. I also have never actually made a move to sell.. so I certainly haven't spent a year trying to sell it.

 

[Ultra7]

So you're saying you went from earning 20-25k a month in 2013 to 40k a month in 2014? The growth rate seems to look decent but there's still a plethora of information lacking to give this business a meaningful valuation. Have you considered contacting an agency to sell your business for you? If you're interested I could help you sell your business for a fee, I have access to a network of people eager to get into online businesses.

It's only $29k/month on average.. so its not a massive increase but approximately 20%-30% seems decent to me in a year.

And no, I've never contacted an agency.. nor taken any steps to sell aside from making this post to get advice on the subject.

 

[randomnumber314]

Sounds promising for you. Do what Mark Cuban did when he sold Broadcast.com--find a company that would benefit from purchasing your company and persuade them to buy it.

 

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[Aivix231]

as i know in Internet space, websites get sold for 10x+ Month profit
But you have established bussiness and huge history and growth so it will go for huge $$$

You just need right person if that would be website it would go for $1 million + EASILY

I would reccomend these guys : http://feinternational.com/

They have sold my friends bussiness and they ahve tons of clients with deep pockets

 

[empireflippers]

Hey Ultra7,

Is this business still available? We might have some investors willing to take a look + make an offer.

We help broker websites and online business transactions in the $10K - $1M range.

Don't worry about anyone who says an online business without a physical office won't sell - that's rubbish.

My guess is your business would sell for somewhere around $700K - $900K depending on a number of factors.

For a quick/rough estimate, you can use our free Valuation Tool:

http://empireflippers.com/valuation-tool/

If you'd like us to take a more in-depth look at listing and selling your business, you can submit it for sale with us here:

http://empireflippers.com/sell-your-site/

 

[mrf]

It sounds like your business is a service (web development) and you're heavily involved in it.

Your most realistic buyer is another web developer who wants to supplement their existing work with your brand's advertising leads / client base / established outsourced support.

Most financial buyers aren't going to have the technical expertise to know if the people you are outsourcing to are doing a good job or not, which makes the opportunity less attractive.

I'd try contacting other web developers / small agencies directly before engaging a broker.

 

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