How to Buy an Online Business
5 step business acquisition roadmap
Are you Thinking About Buying an Online Business?
Our team has facilitated hundreds of successful deals over the years. We know what it takes to get you through the business acquisition process from start to finish.
We have also been around long enough to see many first time business buyers trip up and miss out on a big opportunity. Our team will navigate you around the many common pitfalls first time buyers fall into.
With the ever increasing competitive environment, it is imperative that you get an edge over the competition. We shed light on the tactics that the most successful acquisition entrepreneurs are using to maximize their success.
The following guide is a recipe for success that will put you ahead of the competition. Follow these steps, and your business acquisition will surely be successful.
5 Step Process to Buy an Online Business
Getting pre-qualified is the first and very valuable step in buying an online business.
Based on your business acumen, personal liquidity, and acquisition objectives, we are able to determine the price point that you are pre-qualified for.
Additionally, this step will help set you up for a successful search as you compete against other buyers who have not completed this set. Sellers are more likely to accept your offer.
With an extremely competitive environment, this step is essential.
Questions you should ask yourself
- Am I acquiring a business by myself or with a business partner?
- Do I have the necessary skills to run an online business?
- What is my price range?
Connect with a Business Broker
Instead of just being just another email address to an online brokerage firm, proactively contact a business broker. This is something nobody does, and it is so effective!
Ask for a 15 to 30-minute consultation, and during this call outline what type of businesses you are most likely to be interested in. Make sure to give them your price range and timetable.
This dialogue will be a game changer when a business opportunity arises. Many times, they will give you “first look” at a business that is just about to hit the market.
By starting your acquisition process at eCommerce Lending will enable us to connect you with the best brokers in the industry, so you can get access to the best opportunities.
- Ask our team to connect you to the best brokers in the business.
- Ask for an initial consultation call.
- Develop a working relationship with a business broker.
Determine if a Business that Qualifies for Financing
The last thing you want to happen is to have your Letter of Intent accepted, but unbeknownst to you, the business does not qualify for financing.
Businesses do not qualify for financing for a host of different reasons. It can be because of its short historical financial track record.
Perhaps the business is not domiciled in the US. Maybe in is selling a product that are here today but gone tomorrow.
Whatever the case may be, we help our buyer clients by pre-qualifying business, and we can help you too.
This will help them determine if it qualifies for financing, and is something we can help you with.
- Does the business have solid financials?
- Is the business domiciled in the US?
- Have our team pre-qualify the business.
Send a Letter of Intent
Since it is likely that this is your first time buying a business, leaning on others that do if for a living may be a prudent step when formulating your offer.
Part of our process with our buyer clients is to assist them in structuring their offer in a way that separates them for the pack and avoid common pitfalls.
For example, they may want to include an ‘earn-out” in their offer, but they do not realize that earn-outs are not allowed in financing.
We help them structure their offer in a way where they obtain the same result.
The Loan Process
The loan process can be a little bit daunting. It is imperative that you choose a lender who has an efficient system in place, otherwise your frustration level will hit an all-time high.
Secondly, with the many nuances that online business acquisition financing presents, make sure you choose a lender who understands this space, otherwise, you may never close on your acquisition.
After financing over $1 billion just in the online business acquisitions, we understand all the potential pitfalls and know what it takes to guide our buyer-clients through the acquisition process.