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They’re likely to end up at Empire Flippers, Flippa, QuietLight, FE International, or another marketplace: https://www.skipblast.com/empire-flippers-vs-fei/ htt

They’re likely to end up at Empire Flippers, Flippa, QuietLight, FE International, or another marketplace: https://www.skipblast.com/empire-flippers-vs-fei/ https://www.skipblast.com/empire-flippers-vs-fei/. Google for ‘empire flippa quietlight fe’ for more. Your seller’s revenue is significant but profit margin will matter more for valuation, and their profit margin is in the range that any of them could probably handle.

tomcam 6y ago
Interesting. I’d assume some level of interest from the IB world at that level.
- troydavis 6y ago
  If it was SaaS or even licensed software, absolutely. Multiples on earnings are really low for FBA and similar e-commerce businesses, though. 2-4x earnings (earnings, not revenue) is typical (more: https://www.digitalcommerce360.com/2020/12/23/why-now-is-a-great-time-for-amazon-sellers-to-sell-their-business/ https://www.digitalcommerce360.com/2020/12/23/why-now-is-a-g..., https://feinternational.com/blog/how-to-sell-an-amazon-fba-business/ https://feinternational.com/blog/how-to-sell-an-amazon-fba-b...). Unless there's something truly unique - like they're creating and manufacturing products based on their own IP, or have a large share of a market that itself is growing - roughly 3x earnings is typical. In this case, 3x would be about $10 million. A banker might take your call, but that's still too small to really be worth their effort. Also, the prospective buyers of bigger FBA-style businesses like this one are already interacting with the brokers/marketplaces I mentioned. It's unlikely that someone who has never owned an FBA business is going to just jump in. It's sort of a self-contained community. Some examples: https://www.webretailer.com/b/thrasio/ https://www.webretailer.com/b/thrasio/, https://quietlight.com/101-fba-businesses/ https://quietlight.com/101-fba-businesses/. Of course, a banker could approach these prospects, but I don't know how they'd increase valuation by more than their fee.

tomcam 6y ago

Interesting. I’d assume some level of interest from the IB world at that level.

troydavis 6y ago
If it was SaaS or even licensed software, absolutely. Multiples on earnings are really low for FBA and similar e-commerce businesses, though. 2-4x earnings (earnings, not revenue) is typical (more: https://www.digitalcommerce360.com/2020/12/23/why-now-is-a-great-time-for-amazon-sellers-to-sell-their-business/ https://www.digitalcommerce360.com/2020/12/23/why-now-is-a-g..., https://feinternational.com/blog/how-to-sell-an-amazon-fba-business/ https://feinternational.com/blog/how-to-sell-an-amazon-fba-b...). Unless there's something truly unique - like they're creating and manufacturing products based on their own IP, or have a large share of a market that itself is growing - roughly 3x earnings is typical. In this case, 3x would be about $10 million. A banker might take your call, but that's still too small to really be worth their effort. Also, the prospective buyers of bigger FBA-style businesses like this one are already interacting with the brokers/marketplaces I mentioned. It's unlikely that someone who has never owned an FBA business is going to just jump in. It's sort of a self-contained community. Some examples: https://www.webretailer.com/b/thrasio/ https://www.webretailer.com/b/thrasio/, https://quietlight.com/101-fba-businesses/ https://quietlight.com/101-fba-businesses/. Of course, a banker could approach these prospects, but I don't know how they'd increase valuation by more than their fee.