As an entrepreneur, it's important to not only focus on building a profitable business but also to consider the potential for a future exit. In this blog post, we'll discuss some key factors that appeal to buyers and how you can increase your potential multiple for exit. We'll also take a look at the "Exit DNA" course by Mac Lackey, which offers valuable insights into the exit process.






Time Stamps


00:00 | "Delegating Your Way to a Sellable Business: A Conversation with Yoni Kozinski"




03:30 | "The Benefits of Building a Business with a Clear Plan"




04:41 | "Maximizing Your Exit Potential: Strategies for Achieving a Successful Acquisition"




06:41 | "Strategies for Selling a Business: Understanding Aggregators and Prospective Buyers"




08:24 | Exploring Strategies to Maximize Exit Value for Businesses




14:00 | "Understanding the Challenges of Selling an Ecommerce Business"




14:54 | Discussion on Setting Financial Objectives for Business Success




16:45 | Exploring the Process of Preparing to Sell a Business: A Discussion




19:54 | "Maximizing Your Business Multiple: A Step-by-Step Guide"




21:56 | Heading: Considerations for Building Toward an Exit in Ecommerce




23:26 | "The Importance of Budgeting and Inventory Management for Building a Sellable Business"




29:05 | Exploring Growth Strategies for Ecommerce Businesses with South Coal




32:28 | Discussion on Ecommerce Business Investment Criteria




33:43 | "Exploring the Benefits of Working with a Consultant Who Has Skin in the Game"




34:55 | Heading: Exploring Southcool Co's Ecommerce Valuation Tool with Yannie of Southcool Co




36:51 | "Interview with Yoni Mazor: Building Business Value and Evergreen Skills"


Understanding Your Ideal Buyer
To build towards a successful exit, it's essential to understand who your ideal buyer is. This requires looking years out and considering the types of businesses that would be interested in acquiring your company. For example, if you're in the e-commerce space, you might be looking to sell to private equity or strategic acquirers.
Assessing TAM & Competitor Position
Investors always look at TAM (Total Addressable Market) with an eye towards growth opportunities. Consider the level of competition in your niche and whether there is an opportunity for you to take market share. Is there a private equity or strategic acquirer in the niche? If so, building towards a market-leading position in that niche could make your business more appealing to buyers.
Why Start in the USA?
Starting a business in the USA offers a significant advantage due to the large population of 350 million people, with 50% of e-commerce sales happening on Amazon. This provides a vast TAM to penetrate and build market share. While other markets like Australia may offer less competition, the smaller population makes it harder to achieve meaningful scale.
Maximizing Multiples
To increase your potential multiple for exit, it's essential to have a clear distinction between getting ready for exit and maximizing your multiples. This requires identifying areas of the business that are critical to the multiple, such as SOPs, training videos, and documentation. Automating and delegating to people who are better than you are at certain tasks is also crucial.
Building Relationships with Suppliers
Building strong relationships with suppliers is also essential to building a sellable business. Aggregators and other buyers are interested in businesses that are operationally sound and can continue to grow even without the founder's involvement. Having clear SOPs, training videos, and documentation helps ensure that acquirers can understand how the business works and can integrate it into their operations.
Inventory Planning and Budgeting
Inventory planning and budgeting are also critical to building a sellable business.