ThomasSmale
Joined 11 years ago
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Dec 1
Founder of FE International - specialising in the sale of small online businesses.
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Comment · 8 years ago
Thanks for reading! Hope it helped clarify what you needed to know for your online business to be compliant with GDPR and avoid fines.
Comment · 8 years ago
Thanks! Quite a bit of extensive research and expert opinion went into the post :)
Comment · 8 years ago
Glad to hear it was helpful! A lot of the digital businesses we work with were finding themselves lost in the noise, so we wanted to make sure there was a complete, straightforward guide to compliance they could follow.
Comment · 8 years ago
Thank you! We are trying to lead the way with content in the space - we've written a lot about SaaS in the past, but not much about apps in general. It's a hard topic to find credible content on as it's a relatively new space and most of the exits you here about are huge apps like Snapchat and Instagram. 99.99% of apps will never fall into that same bracket but doesn't mean there is not a market to sell.
Comment · 8 years ago
Overall we look at thousands of variables with varying degrees of weighting. Can't just use the same generic approach to each different business model as would over-simplify and ignore (or overplay) nuances of specific businesses that could be strengths or weaknesses.
Comment · 8 years ago
Thanks! Tried to cover a range of apps in there. We've written extensively about SaaS in the past, but not other apps which are also equally popular.
Comment · 9 years ago
Hey Wenshaw,
It would be a little small for us at FE International (we generally look at businesses generating at least $1K MRR).
Your post is a little confusing - you said you chose the former (i.e. raising money) but also that you looked to sell it as a side project.
It's hard to give specific advice without knowing the business itself but you could always try looking for a partner who has time to work on the business. Trying to sell a new product that isn't making any money isn't impossible but you're unlikely to get much for your time.
Good luck!
Comment · 9 years ago
Sorry to hear you had a bad experience - happy to take on all constructive feedback so I appreciate you bringing it up!
The reason we ask for a 2 year NDA is that this is the generally accepted length of time that NDAs are enforceable in all 50 US states. We do ask buyers/investors to re-sign after 1 year so that our sellers are comfortable that there is at least 1 year remaining on all NDAs at the point of us listing a business.
That being said, on some listings sellers request that new 2 year NDAs are signed with all buyers/investors irrespective of how long is left to run on a pre-signed document. This is usually limited to 7 and 8-figure listings.
Sellers and buyers/investors both generally appreciate our strict approach. Making sure that we are operating diligent process when it comes to NDAs and sharing information is important for sellers as well as a new owner of the business.
Happy to jump on a call to discuss further if you would like: https://calendly.com/thomassmale.
Comment · 9 years ago
Lots of reasons. Just beware on marketplaces (Flippa, EmpireFlippers) etc. which have varying levels of vetting (from none to basic verification) as sellers often make up reasons or are lying about hours worked.
Some legitimate reasons to sell something "passive"
- Have another business growing that needs cash - Need a lump sum of cash for X - Lower tax rate (generally) paying capital gains vs. income tax - Cash in the bank often beats future uncertainty - Being passive doesn't mean it's low risk or doesn't keep you up at night
Comment · 9 years ago
I'm founder of FE International (mentioned quite a few times in this thread already). We've done over $100m deals in the online space and have won various awards (e.g. for my business partner, Ismael: https://www.ibba.org/press-releases/2016-ibba-member-excelle...)
When searching for a business to buy, make sure you do your due diligence. There's a lot of junk out there and many "brokers" just make up their numbers/claimed legitimacy to win business. Once you've got past that, you then need to do due diligence on the business itself.
Passive businesses are not impossible to find, but it does depend on your definition. You can't buy any business and do absolutely nothing (truly "passive"). Even something low maintenance will require 1 hour a week, especially if you want it to last for years. Expect to pay a premium for businesses like this but be very cautious around claims from a seller. Number of hours worked is the easiest to misrepresent (and the hardest to prove). Almost every seller claims to work "2 hours a day" but IRL I've never met a business owner who works less than 10 a day :)
To answer your question directly, don't just look at marketplaces, check out brokers and advisors too. If you're upfront with what you're looking for and budget, most will send you options that are a good fit.
Good luck with your search!