When, Why, And How To SELL An Amazon Business

So we're going to introduce our first speaker now. And so I'm looking at his introduction and I can definitely tell he wrote it.

You'll see why I may do a little paraphrasing here. So this person is a good friend of ours. He's actually an Austin, Texas resident like I am, so we hang out. He's an awesome guy. Spent about a couple weeks in Thailand with him at one point. Really cool guy. So he runs several successful Amazon businesses on pace to sell over $5 million this year 2015. He also recently sold one of his Amazon businesses, which he will be sharing with us today. He had previously been featured at ASM and ASM3, and he was voted best speaker at the most recent event. Ryan was one of the top affiliates for this ASM this past round and and he currently has one of the top business podcasts on itunes called Freedom Fastlane. More importantly, oh boy. He's recognized as the handsomest speaker at ASM events.

And once again, he was recently honored with the handsomest Amazon Seller award.

Which.

Was announced privately at an undisclosed location. So I'd like to welcome the stage, Mr. Ryan Daniel Moran.

Hey, guys.

So, Matt Clark, thank you for writing such an incredible intro.

Hey, asm, it's good to be back. Hey, where is the tribe?

I am so proud of these guys. This is my ASM mentoring group. They have done some incredible things. I'm really proud to be a part of you guys.

So today we are going to change the game.

Today we are going to set the frame a little bit differently. Now, for some of you, it's a little bit early. It seems to be thinking about what it looks like to exit your business.

But I have found that something fundamentally changes in the way that you approach and run your business when you approach it with an end in mind.

Now, I had a second.

Alternative title for this talk, and I thought about going with the name the Second Option.

And that didn't really make much sense when you read it. But my thought there was that what I've discovered is that when you exit a business, you are in a position to monetize what you have built in a way that we've never talked about before. There is a second option to profiting from the business that you've built, even.

If it's still in kind of its early stages. And when you get this, you realize that there's more than one way to put money in your pocket from what you've built. It doesn't just have to be building a business that reaches a certain level and that you take the profit off the table and put in your pocket. Now that works. That works great. But there is another option of putting money in your pocket in a way that we've never talked about before. So today we're going to be talking about when, why, and how to sell an Amazon business. But first, I need to take a selfie.

Will all of you act like you're having a good time.

Or just sit there? That's cool too.

You can find that on Facebook later. All right, let's dive in. So I run a website and a podcast called Freedom Fast Lane. It's currently one of the top business podcasts on itunes. And this year we'll do a little bit north of $5 million on Amazon. In ASM2, I was here on stage and I talked about the launch process that we had used that skyrocketed the pace of the growth of our business. A quick recap there was that one of the ways that you can really accelerate your success is by planning a launch of your business. Now, we did it with a Facebook page in our yoga business. We had no previous audience with yoga. We had no connections in that space. So we built it up organically using a Facebook page. There are several other ways that you can do it too, which we'll talk about briefly. But this is what we focus on at ASM2. At ASM3, I outlined the three stages and what falls into each stage that you need to do in order to put yourself on pace to have a million dollar business within 12 months. We modeled this off what we had tested in our own businesses and what had created the maximum results as a result of us testing those things in our business. Well, this year literally just got the first check a couple of days ago when I was on the airport to here. We sold our yoga business. We sold Zen Activ Sports.

Now, we had no plans on doing this. We had more of the standard narrative, if you will, in our minds of we were going to build up this business and we was going to make a bunch of money. We were going to live off the profits. But when a buyer approached us, when we started looking at how the deal would break down, we realized that the way that we could exit our business would actually allow us to reach the goals that we had for this business to put money into our pocket much faster. Now, it wasn't the narrative that we had in our mind. It wasn't how we thought we were going to make money from our business, but it ended up putting more money in our Pocket than if we had held onto the business.

At the same time. And probably most importantly, and what I really want you to take away from this is when we started to think about selling our business, it completely changed the way that we approach the business from an operations standpoint. These little things that we didn't think mattered before all of a sudden had a tremendous impact on the sale of the company. I'll talk a little bit about those throughout this presentation. So a few years ago I used to buy and sell websites and I would buy them, fix them up and flip them kind of like a house or I would build them from scratch and I would sell them. And what I discovered going through this process is that the same rules that applied for buying and selling websites kind of apply for Amazon businesses. The only difference was that the numbers were a lot bigger. We were dealing with bigger numbers. What's kind of interesting is at least I found it's easier to build a really valuable Amazon business than it was even back to build a website that you could flip. And the numbers that you put in your pocket are much, much bigger. I very strongly believe probably a year from now we'll be having lots of conversations about buying and selling Amazon businesses. It's going to be the next trend. I am basing this prediction not just on my own experience in the last few months of selling our business, but also from just the chatter that I hear among my business connections who aren't necessarily in this community. They're starting to say I've got some money that I'd like to throw at a physical products businesses or I have access to capital and I know people who want to buy several businesses. Do you know anyone that might have a business that's based on Amazon they might like to sell? Well, I might know one or two.

What's really important that we took away from this was that we realized that there are more ways than one to put money directly into our pocket. And when we sold our business, we realized that doing so put cash directly into our pocket much faster. Faster than when we had been trying to do it in the traditional route. So first let's talk about what type of a business might sell.

Traditionally, a business that sells well is going to be one that's in a stable market. In fact, the person who one of the people who bought our businesses said we love boring businesses. We love businesses that aren't based in some diet trends. Not something that was as seen on TV for six months and was hot and died, but things that were stable over time. Something Like a yoga business was a really stable, growing market. And if you have multiple product, a product line that helps as well. Now here are a couple red flags if you're doing any of these. Might be a little bit of a red flag if you're at least positioning yourself for sale down the line. And that's anything. That's a hot trend that's dying if you're still selling Garcinia cambogia. Nothing wrong with that. It's just a hot trend that isn't going to be around forever. It was featured on TV on Dr. Oz. And that's something that somebody with pockets, money in their pockets who wants to buy a business probably is going to avoid. Anything with a potential FTC violation or anything that might throw up some undue legal attention is going to be something that a buyer, an outside buyer is, is probably going to want to avoid. We were talking in the tribe yesterday at our bonus day about a podcast that I had and one of the individuals that I interviewed was talking about when he sold one of his businesses and he said he started to evaluate his business as he was going through his balance sheet. And he said if I was looking at this from a buyer's perspective, would I even want to buy my own business? And he realized that he probably didn't. We're all biased in our own businesses saying what has more potential or what we could do. But from an outsider's perspective, they're not looking at what the potential is. They're not looking at what you think is best. They're looking at the fundamentals of a business. So even if you are selling a lot of product, if you're in an industry that an outside buyer doesn't want to be in, this probably is not going to be in the best option for you. Again, there's nothing wrong with that approach. It just means that exiting that business is going to be at the very least difficult.

At what point can you start thinking about selling your business? Well, I know buyers who are interested as low at about the $10,000 a month in sales point. But the more the better. You don't have to be several years old, although that can help if you have that type of sales history and you don't need to be selling millions of dollars, although that can attract some higher level buyers. But once you're even at about the $10,000 a month in sales point, you can start to think about this and as we put it in our bonus day in the tribe, put on your big boy pants and start to think like A real business. Because when you look at would someone want to purchase this business? Would outside funding be attracted to my own business? You start to identify the holes in your existing business and where you might be leaving money on the table. I'll explain this further as we go through, but first I want to recap a bit what I consider the three stages to $1 million. Now, this is important for me to recap because until you're at that point where you are growing, this conversation doesn't really make sense. For some of you who haven't made your first sale on Amazon yet, it kind of feels like we're putting the cart before the horse. So let's recap what I consider the three stages to $1 million so you can start implementing this. And when you start to grow, this conversation becomes much more relevant because you'll be in a position where you need to start thinking about will outside funding or an outside buyer be an option for me? So I break them into three stages. The first that I call the grind. This is when you're, you've got your inventory in place and you're going, okay, what the heck do I do now? I'm making two sales a day and I wanted it to go faster than this. I am literally begging, borrowing, and stealing my way to try and make every sale and every review. Every little thing matters. If you are doing less than 20 sales per day or you have less than 50 reviews, then you have no other job except to think about what you need to do to get to about 20 sales a day and 50 reviews. I'll go through my process for this in a second. This second stage is what I call the growth. This is where you duplicate stage one as many times as you can comfortably handle. You are releasing as many products as you can handle without distracting from what you built already. And stage three is the gold. This is where you have several products doing at least 20 sales a day. You are gathering customer data, building up a real base of customers.

And you are starting to think about expanding to new traffic sources. Now, I only put this on here so you can see where certain things fall. For those of you who are still in stage one or stage two, all you need to think about is sales and reviews and then duplicating that process over multiple products. That is all you need to think about. I bring this up because until you're out of this stage one, trying to figure it all out, get sales flowing through the Amazon channel, this conversation is a little bit irrelevant. Besides the fact that when you think about this, you become a better entrepreneur. When you think about building your company with an exit in mind, you just become a better entrepreneur.

But from a practical standpoint, there's probably not going to be anybody interested in providing outside funding or buying your business until you are out of this stage one grind. So here is what I consider the magic formula for getting out of the grind. I have absolutely beat this to death in the tribe, and as a result, we've seen incredible results. Because doing just this will get you to the point that you need to be in order to start duplicating the process. The first thing is asking everyone you know. Your neighbor, the pizza delivery guy, your dog, your neighbor's girlfriend, your spouse, your children, anyone with an Amazon account that you can bother to death to try your product and leave a review until you're at 25 reviews. Once you're at 25 reviews, then you turn on Amazon pay per click. Now why do I say wait until this point? Because we need to have conversions in order for pay per click to make sense. And conversions don't really start happening until you've got a few dozen reviews.

Beg, borrow and steal your way to 25 reviews. Turn on Amazon pay per click. Then I suggest that doing some sort of a product launch. There are several ways to do this. I'll talk about my favorite in a second. We've done it with a Facebook page. You can do it with your own list if you have a list in that industry. But do something to spike your bsr. The reason for that is because the majority of your sales are going to end up coming from the keywords that you rank for and from everything that I have tested.

The biggest weight to where you rank for keywords is the quantity of sales coming through that keyword. I have tested. I wish it was more complex than this, by the way. I wish it was a whole bunch of other things that I could test and tweak, but I haven't found that to be the case. I find I'm kind of wasting my time unless I'm thinking about quantity of sales. And every time I spike my bestseller rank through a keyword, my keyword ranking goes up every time. And then the only other thing you need to think about is having a good system for getting consistent reviews. Until you have done this process, I think everything else is just noise because this is what will get you to the point where you're making consistent, consistent enough sales to then think about duplicating the process and moving on to the next thing. Or if you Want to complicate the process more at that point, you're welcome to, but I found that this process works just fine. Now, we have done several many different ways to try and spike bsr. The best one that I have found is a tool called zonblast.com now, full disclosure, these are tribe members. I advise these guys a bit on their business, but this was built specifically out of need and I am a paying customer for this product, as are most of my most successful tribe members. We have tested a bunch of different ways to launch a business to spike our bsr and this is the one that we've had the best results with. So this is a tool, we call it bullying our way to the top, spiking sales enough until we are ranking for the keywords that we want to rank for. And what this does is it syndicates your product out to a few thousand Amazon buyers and doing a discount in order to inflate the quantity of sales that you are pushing through a keyword, I suggest between 100 and 500 units as close to cost as possible. The people who are really aggressive will go into the red on this. I think that's totally cool. I think it's totally a smart thing to do to go into the red until you are ranking for the keywords that you want to rank for, because this will literally bully your way to the top. We've seen where this will overnight spike your BSR into the hundreds for a short time to inflate your BSR to get you ranking for keywords. So you get regular organic sales coming through. There's also since these are Amazon buyers who are trained to leave reviews, you end up getting a lot of reviews from running this process. Now these are tribe members. They're ASM members, so I asked them if I could throw a coupon code into the presentation and it's ASM4 through this URL that's on the screen right now. Really quick. I did a case study with this shortly before we left for Vegas. I have one company that sells a fish oil supplement and for the life of us we could not get this thing onto page one for its main keywords. We were stuck on page two at the top of page two doing about 30 sales a day. We did one blast and this put us onto the bottom of page one and our sales, or our organic sales, our natural sales, went to 100 sales per day. When we break this down, this is an extra $37,000 a month in sales from Just Bumping from page two to page one. By running it through a Zomblast. So this is a tool that we use all the time.

Now that kind of replaced all of the stage one grind that we had been doing before. Instead of begging, borrowing and stealing reviews or running a bunch of Facebook launches or whatever it was, we really just used that tool now. But if you want to see where all this falls into context, where the three stages are. Where the three stages are for building to a $1 million business. I put up the old presentation@freedomfastlane.com.

So you can see the whole presentation then. Now, I put all this in context for a very specific reason.

This extra $37,000 a month or so from doing things the right way, yes, that is good money. Yes, that impacts the number of dollars that are put into my bank account.

But this has a magnified effect when we start talking about acquisitions.

This has a monumental, life changing, family tree changing impact when we start to look at multiples. Because it's all of a sudden not just what affects you on a month to month basis, it is the value of your company.

So these little things that have an impact on sales, that when I was building my businesses didn't feel like a big deal all of a sudden have a magnified impact. I'll talk about that more when we get through. But I again bring all this to remind you that once you're out of this stage, once you are out of this grind, then you are in a position to start thinking about exiting your business. If this is an option that you want to do. And we'll break down all the numbers as we go through, but first let's talk about when it might be an option for you to sell your business. Once you are out of the grind and you're selling at least about 10 to $20,000 a month, more is better. I was having a conversation with a buddy of mine on Super Bowl Sunday, actually. We were talking about outside funding and how once you reach certain levels, as you go up the chain, more and more money starts to become available. Because people with the biggest dollars, they want the best bang for their buck, literally. So they want the businesses that are profiting the most. But the minimum basis is about 10,000 to $20,000 a month. This is when it becomes a second option for you to begin thinking about. Now, this was a little bit of a weird concept for me to get, but when I got it, it was so liberating. Your company doesn't necessarily have to be putting money directly into your pocket in order to be sellable. It certainly Helps.

But it doesn't necessarily have to be the point where you are personally financially free from your business in order to attract an outside buyer.

I found this point. I call it the second hump. I call it the first hump when you get your inventory in stock and you go, what the heck do I do now?

So we've come up with strategies to get through that. But now I found that there's this second hump. There's a second hump when you have products selling. You might even have multiple products selling, but all of your sales are going back into buying more inventory and growing your business. And you have this realization that unless you get some outside cash.

It'S going to be hard to grow your business to the next level. So what do you do in that position? Well, this becomes an option for you. By the end of this, this will all be crystal clear to you. Let's talk about why you might want to start thinking about selling your business. Now. There's this idea, there's this dream that I know all of you have had, which is I'm going to sell my business for billions of dollars, just like Facebook bought Instagram, and I'm going to retire to a beach and be happy and merry forever. Look, these are the stories we hear about, but these huge acquisitions are a little bit rare.

So why might you want to start thinking about selling your business?

Let's be real about the cost of building a business.

I think for some of my businesses, I had like $10,000 in startup costs. I had a few thousand dollars in marketing, and I had this second product come out. And all of a sudden all the profits that I had went into that second product. And I was happy to invest the money. I believe, in this process. I've made millions of dollars through this process. But I understand that there's this hump of, like, I've got this investment in. I got these sales coming in. I'm profitable on paper. But when the heck do I get to take my money? When the heck do I get to put money into my pocket? When does this happen? I've got sales. I'm making money on every sale. I'm making tens of thousands of dollars a month in sales. But when do I. Where did all my money go? Where is it? Well, the answer is right now. It's in your equity. It's not just the money that's going into your pocket. You're building up a real asset. This is good news. I want you to get something. I want you to realize that even if you're frustrated with the fact that you're not putting money in your pocket right now. You're. You're building up an asset that has intrinsic value. You're building up something.

That is adding to your net worth. It has intrinsic wealth. It is not just cash flow that is going into your pocket, but you're building something much bigger than that. So even if you've hit the point like I have hit, which is, I'm making all of these sales, but where's my money? Why do I keep after putting it into more inventory? It's because you're building something that is much bigger than just cash flow. And when you realize that there are outside buyers who want these types of businesses, all of a sudden you are liberated from this tense feeling of, I have to make sales or a certain amount of money by X date, or I'm going to consider this a failure. It's almost impossible to have that perspective when you get this, when you realize that you're building something that is much bigger than just the cash flowing into your pocket. So imagine when you hit that point where you're like, I need outside funding. I'm not really sure how I'm going to grow this unless I get some outside cash. Imagine if you could just get a check for your entire investment, for your inventory, and a nice check on a multiple of the profit that your business is making. All of a sudden you realize that there's a second option. There's other ways that you can pull money out of this business than just by selling hundreds of thousands of dollars worth of product every month.

Here's a quick example. The company we just sold, Zen Active Sports, was doing about 10 to $15,000 a month in profit, which sounds great, except our salary was zero.

We weren't paying ourselves anything. So we were putting that back into inventory, back into marketing, growing the business.

So instead we hit this point where it was like, yeah, I could take money out of savings and like, infuse this company with more cash and more products and more aggressive marketing. We could do that. Sure. Or we could talk to this outside buyer who's offering to give us a healthy check and also some cash flow right now, which is going to make us get our goals faster. Even though we weren't paying ourselves, we got to pay ourselves by going this route. I'm not suggesting that this is the best scenario for everyone, but this is what was best for my partner and I on this business. This was the decision that we decided to make on this business. So we took this cash and now we have flexibility to say, what do you want to do now? What do you want to do next? Do you want to build another business? Do you want to take a break? So we decided we're probably building another business. And now there's less fear and tension now about even going into a business. Because we know now that it's not just one way, that it has to make sense. It's not just one route that has to be successful in order for us to consider this a success. We have this other option where even if we hit this point again, where we weren't putting money directly into our pocket, we were building up an asset that would be attractive to an outside buyer. So there's more opportunities, so there's less tension and stress going into a business in the first place. It makes it easier to build the business the right way. The second reason we decided to sell was because of timing. There's a consolidation in every market. There is always a wide open west and then a consolidation where sales and income go to the people who already own markets. It happens in every market. There's nothing scary about it. It just means you need to think about business a little bit differently. For us, we knew it would require even more investment for us to grow that business. And we decided we didn't want to go that route. So we sold to the consolidator. We went to the person who was already established to be a big player in that industry. When you have consolidations, marketing costs go up. And that creates new opportunities and new challenges for us. We just decided to exit. We felt like since things are starting to consolidate, since there's more players entering the market, we decided it was time for us to exit this industry.

And I know you've thought about this. Don't act like you haven't, because I have. What the heck happens if Amazon makes a major change and eliminates my category? Or if Jeff Bezos dies and the whole Amazon business goes under? Don't act like you haven't thought about it. I know we've all laid in bed and thought about doomsday scenarios. Even as silly as they are, they're not gonna happen. But I know you've thought about it. Cause I have, too.

So for us in this business, it was the right time for us to think about removing ourselves from this business and letting somebody else run it.

So I hope I have beaten this into your head. And that is that you have an asset that you are sitting on and you can sell it. And there's all this curiosity right now, about what we're doing in this room, there's all this curiosity and buzz right now about what we've done as a community. There are people on the outside who are saying, hey, I think there's actually money to be made on Amazon and are starting to say, I've got this outside funding. I think I might want to buy a business like this rather than build it myself. So there's an argument to be made around, is this the right time for us all to be thinking about, is this a chance for me to get the most for the asset that I've built? Now, I don't know if that's the case, but this is when interest is really high. And I want you to see that it's not just the profit that you're putting in your pocket that makes an impact.

Your inventory, your systems, these are all assets in your business that you can literally monetize. But they don't become monetized until the day that you sell. But you can cash them out at any time. And selling is one way that you can convert these assets into cash, literally in your pocket. Now, the most important reason, I think the most attractive reason to for selling a business is just simple. For reinvestment, we've shortened the grind process through tools like Zonblast, through the process that I've outlined that we've tested a hundred different times, that works. Getting out of that grind stage is really easy right now. It's really easy for us to duplicate that process.

And to get into the realm in which all of a sudden, we're attractive to an outside buyer. We can repeat that process really quickly. I mean, if you get a good product and you repeat that process, it's really easy to get out of that grind stage. So you can repeat that process, build more Amazon businesses, assuming you had more cash.

And just repeat this process. So imagine you would sell one business, take that money, build the next one even better. Instead of like, hey, Mr. Rich uncle of Mine, could you loan me some money? What if you just sold the business, took that money, put it into another business and built that up even more? This is a second option for those of you that it's right for and that it's right timing for. So if you had that option, if you knew that you could sell a business, could you theoretically build and repeat this model over and over again? You could take that cash, you could put some money in your pocket, and then you could have plenty to reinvest into the next thing. Let's talk about how. Let's talk about how you might go about selling your business. And there's several different ways to do this. None are right or wrong. I'm going to tell you the route we took, but nothing is right or wrong. But there's a couple things that you will need to have prepared in order for this process to go the way you want it to. The first is you actually need to keep sales reports and profit and loss statements. If you're not doing that, let's start to think about a real business. Okay, so let's be if you're not making sales yet, be prepared to take sales reports to make profit and loss statements. Also documented systems of who does what, when they do it and how they do it. So and so goes into seller central, creates a new product every time we have a launch.

So and so creates an Amazon PPC campaign using keywords that we find through this. We spend this much and here's when we do it, we check it every Sunday. These documented systems are things that outside buyers want to see because guess what, they gotta run the business after they buy it and they want to be able to grow it. So these are really important.

They also just make you a better entrepreneur. When you start to systemize these things. Legal documents, like when I was asked for my articles of incorporation and I was like, they're in a file somewhere in a box somewhere, I think I have them.

I'm not a detail person. I hope you're better than I am at details. But for those of you who are as detailphobic as I am, might want to keep those in a safe spot. And also just a list of the connections of people who are involved. Your suppliers, your shipping companies. These need to be documented systems. So having all these things in place where you could literally hand it over to a buyer so that they could take it over, it makes the process much easier. Confusion.

Results in lost money. That happens with your customers, that happens with your investors, that happens with your employees. That happens with people who want to give you money for your business. If there is confusion, Confusion is the fastest thing that could kill a deal. I'll give you an example in one second. Now, here's some things that would be nice to have. Here's things you might need.

They're not always the case, but you might need this. A plan for growth. If you had more capital, how would you invest it wisely in order to 10x this business? This puts you in a position to make your acquisition more attractive because you're literally taking what's in your brain as potential and putting it into a document that the outside acquirer is able to say, I do see the potential here. Maybe this is something that we want to go into. So having a plan for growth is something, if you have it written down, makes you more attractive to an outside acquirer. A competitive analysis of what gives you an edge over the competition. Showing the trend of your market, showing the trend of your sales, showing why you're gonna last in this business when your competition is not going to. These are all things that you might need or would be nice to have to put you in an even better position to sell. And your background. Showing anything you might have regarding patents or anything you want to explain about the product line. These are things that you might need or you might want to have.

And by the way, if you're making any claims that maybe you shouldn't be making, this would probably be a good time to kind of fix that.

Nothing will kill a deal faster than a threat of anything that you might be saying that you know you shouldn't be saying. But it's good copy. It's good for conversions. You might want to knock that off. So let's talk about the buyers. Let's talk about who's bringing the money to the table. Who might be buying your business. There are basically three sources for this. There are horizontal acquirers. I'll explain what that is in a second. There are brokers, and there are aggregators. And I'll explain what all three of these are. A horizontal acquisition is. This is the story that we all like to hear. This is Facebook acquiring Instagram. This is someone in a large industry acquiring one of their competitors. This is the maximum payout. But they very rarely happen. Now, if you. And they never happen unless you're doing at least north of $1 million until you are at at least $1 million in profit. Horizontal acquisitions usually don't happen. But these are the highest payouts. But they're extremely rare. But these are the nice story of going to the beach and relaxing for the rest of our lives and never working again. The reason for this is because somebody who's buying a business in a horizontal acquisition, they're doing it not just for the cash flow. They're doing it for the customers. They're doing it for their position in the marketplace. And there are different factors than just the amount of money a business is making. So I tell you this to put this in context, because I know that this is kind of the dream, but it's a little bit rare. But this is the situation in which it happens this north of $1 million, you've got a good customer base or you have something new in the market and somebody wants to acquire you to increase their market share. The second and most more common one is working with brokers. There's brokers all over the place who will match your business to potential buyers who might want to buy your business. Now, this has its challenges and its opportunities. One, somebody is going out and finding buyers for you, but they're going to take a cut. And I mentioned this story earlier. I had a tribe member who was working with a broker and they were getting on the high end of this valuation, a multiple of their profit. And it was a really healthy valuation. I encouraged him to move forward with the deal based on the valuation. It looked really, really great for him. He was working with a broker, the broker found a buyer, but because of some confusion in his systems, that buyer got scared. And last I heard, the deal had fallen through. This is one of the challenges worth working with brokers is that you've got this kind of hurry up and wait, get all your systems in place, get all of this ready, and then if one buyer falls through, you gotta wait for the next one. Now, I know plenty of people who have had really, really good experiences with brokers, and I've had some really good relationships with brokers as well. Has its opportunities. Valuation can sometimes be higher. There's not as much creativity in the deal. This is one where it's usually all cash up front. There's not as much. There's gonna be more negotiation because it's one buyer. So it has its opportunities and its challenges. You can Google brokers, but you can just Google business brokers. Once you're at all the other criteria that we talked about, when you have your systems, when you're at the sales level, you can just Google business brokers, read reviews like you would on Amazon and interview a couple brokers. And you can. There's usually not a fee to have conversations and start working with them. And, and they can start to market your business to potential buyers. If this is the route that you want to go now, you have some legal exposure because brokers are not attorneys, they're experienced business sellers. But you don't always have the legal protection if you're doing something you shouldn't be doing. And that comes back to bite you later. So for these reasons, we decided to go the third route. We decided to go with an aggregator. Now, an aggregator is a company that is in the business buying businesses. That's what they do. And they're usually focused in a specific area of interest. They usually buy multiple businesses in one area of interest. And because they're experienced business buyers, they were able to guide through the process, they were able to help us mitigate any risks that might come up. And there was a lot more flexibility in the deal, which helped us reach our goals that we had in our business faster than if we tried to build the business just our own and focus only on cash flow. This also created that mental flexibility of knowing that we could repeat the process over and over again. That's what an aggregator is. That's the route that we went through. So our final deal looked something like this. We maintained a small interest in the upside of the company. And because of this, this is attracted to us because the aggregator is an experienced business builder. So if they're going to invest in your company to grow it, then one thing that caught our attention was that the small interest that we kept might end up being worth more than the company that we were holding beforehand. So it's an opportunity to be part of something much bigger than I could have built all on my own. So this starts to become a really cool second option to be a part of something that's much bigger than I could have done just by myself. It becomes more about just what you got up for for the business. It becomes much more about just the first check that you get when you realize that there are different ways that you can structure deals.

So there were multiple reasons that made this attractive to us. We had some cash up front, plus we had some payments since we didn't get it all up front. So we had some cash flow coming in, plus. Oh, man, this was when I got this. I didn't get this right away. And this was. This really made me even more excited about the deal. When I sold the business, all of a sudden, the money that's been in the bank that I've had to reserve for more inventory, to reserve for more marketing, all the money that I've been keeping reserve now it was mine. It almost felt like a second payday, because the money that I had been keeping in reserve for the business, now we got to keep it ourselves.

I believe very strongly that you are not your business. Your business is a separate entity. There's a very interesting thing that shifts when you realize that you're building a business and you're not attached to the money that's there, because it's not your money, it's the business's money.

Makes you a better entrepreneur. When you think like that, but it was pretty cool when I got to go back into the bank account and take that money as my money. That was fun. It was literally a second check. So it wasn't just about the money we got up front, but all of a sudden we got the money that was in the bank account, plus we got paid for the inventory that was in place. That's common in deals to get paid for basically the inventory that you have there. So all that you have invested is almost like a second check. Plus this company decided to keep us on for a short time as consultants as a transition, and we get paid for that time. So that was an additional source of revenue for us. Plus that small interest that we got to keep in the business. No idea what's going to result from it, but that's another source that made the deal even more attractive. So again, it wasn't just about what we got up front. And it's important here to note, every deal is going to be unique. Every deal is going to be a little bit different depending on your goals, depending on who you're working with, who's acquiring you, depending on what type of business you have. But it's a second option that you can explore. So I asked if it was okay if I included this slide to talk a little about the buyer that bought us. Specifically because they're ASM members, they're actually an Amazon specific aggregator. They focus specifically on our types of businesses. It's a company called Q Brands. They're here. Where are you guys? You're in this room somewhere, aren't you? Somewhere. I heard a woo. So, hey, so they're a subsidiary of a major company, which means they've got the capital, they've got the systems and the growth and the insight into these types of businesses. That made it interesting for us to have conversations with them, but really it gave us that true second option of flexibility with the deal of them knowing the nuances of this business so that we could have conversations of them. I really enjoyed working with these people, so I asked if it was okay if I included them since they're here. I asked if it was okay with them if I put their website on here. I don't want to flood you with a bunch of email inquiries, but they do have a submission form if you want your company to be considered for an acquisition. And they're like, well, we're looking for deals all the time. So this is their website where if you want to submit your business to be looked at, you can submit it for Potential consideration. So thank you for letting me include that link, by the way.

So here are.

Here are a couple things I wish I had known.

Because when we get this in context.

This has magnified impact on every little thing that we do.

There was a time in our yoga business that we ran out of inventory.

This is natural thing that has happened to a lot of us.

So let's play with these numbers for a second. We were doing about.

10 to $15,000 a month in profit. We were out of inventory for an entire month because our inventory was stuck on a boat somewhere in the Pacific Ocean.

So we lost about 10 to $15,000 in profit. Now that hurts.

But that's manageable.

We consider that almost like an expense of us doing business is part of the process. We say, this is the narrative that I was telling myself.

But when it came from a valuation standpoint, it wasn't just the 10 to $15,000 that was taken out of my pocket. You see, it's not like you just value your business.

Based on the best month that you had. You can't have a doubling at Christmas and be like, look outside, buyer. This is how much money my business is making. I wish it worked like that. But it doesn't work like that. It's your sales history that plays a factor. How consistent are your sales? What's the average of your sales? So when we took.

One month's profit out of the equation, and then we multiply that by the multiple that we got from our exit, all of a sudden that hurts. All of a sudden these little things that when you're thinking like a solopreneur, you're like, ah, it's not a big deal. Inventory will get here. All of a sudden that matters. All of a sudden you being conservative and playing on page two for your keywords and not being aggressive enough to get onto page one for your keywords, and in our case, that $37,000 a month that we had been leaving on the table.

That becomes much more impactful when we're looking at it from the perspective of what will this do to our valuation as a company. I know this is meaty, guys, I know this is heavy stuff, but when you get this, you become a better entrepreneur. You run your business better. Regardless of if you are selling your business or if you are building this for the long term. You grow your business better when you ask yourselves these questions. When you put on your big boy pants and you start playing like a real business, you become better at this.

So I wish we had been much better at managing our inventory. I also wish we had known that it wasn't just about the cash flow we were getting, but it was about the asset that we were building. What would we have done differently if we had always thought about the fact that we're building an asset, not just a cash flow stream? How would we have done this differently? Because this matters all of a sudden. I also wish we had kept better records. I wish we had had all of our systems in place beforehand. I wish we had everything ready beforehand because we had to go back and kind of catch up on this. But most importantly, I wish I had known that there was more than one way to profit from this business. And it doesn't have to be just by growing a business for the cash flow. So now you have several options. You can build and hold. You can build and sell. You can build multiple businesses, sell some, hold some. This becomes almost more fun when you get to customize the process a little bit more. Selling is one way that you can put money in your bank account to grow and invest into the next business and do this again and again if that's one way that you want to go. So I have some action items for you that just kind of summarize what we've talked about. If you have not seen the 12 months to $1 million presentation I did at ASM3, I put up the YouTube video at this redirect. It's freedomfastlane.com.

There'S not an opt in or anything. It's just link to the YouTube video. Also, the tool that I mentioned that we use all the time is called ZonBlast. The page they set up specifically for ASM is ZonBlast.com Vegas if you want to talk to the people who bought our business specifically, the link is on the screen there. If you want to take a. This would be a good one to take a picture of. If you want to take a picture of the slide. And your one takeaway question that I want you to ask yourself.

What would we be doing differently if we had more cash to play with and we were playing for the very long term. Would you do anything in your business differently if you are building it like a real business?

Because when you ask yourself this question, you start to see those holes in your business that you didn't see before because you were playing like this was an income stream, not a business. And they're different things and you approach them differently. I was talking with the folks who acquired us and they were even saying like there's instances which like, if people knew that there was capital available to them, they'd probably run their business a lot differently. And like, those are conversations that we want to have. Like, there's capital everywhere. So if, assuming you had it, how would you grow your company differently? Because if there's anything differently, you probably just want to start doing that because that will make you more successful in the long term, whether you build your business or you sell your business or not. Look, we all have the same goal. We all have the same goal of financial independence. But there are many ways to get there and there are many ways to approach your business to get there. And for us, selling our business made the most sense.

Here are a couple extra goodies for you guys. I've put the slides up@freedomfastlane.com asm4 so if you want to go through these slides again, I've got them there. I also, I did this last time and it was a huge success. So I've decided to do it again. I'm going to be doing this talk as a podcast on my podcast, which is freedomfastlane.com iTunes. If you have an iPhone in here, if you just pull up the podcast app and you search for Freedom Fastlane and you hit subscribe, it'll automatically be downloaded to your phone when I post it. I'll probably do it sometime when I fly back to Texas after I leave. Also, if you are at the level, if you're doing over $25,000 a month, I know you have some unique challenges. I know that you have some unique opportunities. If you're at that $25,000 to $100,000 mark and you're looking to go to that next level, I do some hands on workshops in Austin, Texas where I work with people to get them to literally the next level, to get them beyond that six figure a month point. And that is, I actually think this is a typo. It's event center singular.freedomfastlane.com I don't work with everybody, but I work with the people who would benefit the most from having that hands on experience. Guys. I love this community. It's such a privilege to work with all of you. I've never seen such massive success. I think we all owe a lot to Matt and Jason for changing so many people's lives, our lives, our children's lives, the lives of those in our community.

I'm so proud to be a part of this group. You all have impacted me and it's a blessing for me to be able to impact you in some small way. Thank you so much for having me back. Thanks, everybody.

All right, Good job, man.

Thanks. So one thing I want to really.

Make sure you get from that, because I know that was a lot of information, but one of the best decisions Matt and I ever did with our business was start making it sellable. And what that means is like, you heard from Ryan, start getting your paperwork together, start making things legitimate. You need to make it so that you're not afraid to show anybody your books. That's the thing. If you're practicing short tactics that are going to game the system and all those kind of things, it's not going to be a sellable business. If you're not tracking things like doing sales reports, looking at your reports, you know, you probably don't even know what you're doing. You know, the reality is, if you're not treating it like a sellable business and just think about it, if you wanted to buy a business, what are the things that you would want to see from that company? Make sure you have those things. It'll help you get to that next level because you'll know your numbers, you'll know everything about your business. You'll be in control. So that was a great, great presentation, Ryan. Thank you so much. And congratulations on your success, buddy.

All right, everybody, we've got some prizes coming up and a very, very special speaker. Remember, the prizes up to $500, we're going to be giving them out right after a short 10 minute break. So countdown is going to be up there. You've got 10 minutes. Bathrooms are out there. Do whatever you have to do. And we're going to be having some prizes. Remember, when the break song comes on, that's your cue to come back in.