If you want to buy an existing profitable venture, keep in mind that the multiples may be higher than traditional small business valuations since there are so many great benefits to them. You should also know that the financials of most pure Internet businesses are generally simpler to investigate because there are generally no cash sales, and almost all of the transactions are via credit card.
Verify any potential liabilities, guarantees, etc., that may have been offered in the past. Get copies of old site versions from the owner. Some sites began by offering 1-2-or 5-year guarantees on their product. These claims can come back to haunt you. You’ll need the seller to indemnify you from any future claims or you need to have a mechanism to offset any claims against the balance of sale.
It is a bad sign if you cannot find successful products that are similar to yours in the niche of your choice. You won’t have any competitors, but what if the market is dead because you are solving the problem no one cares about? It’s best to choose a niche where there are several other players with differentiated products, so you can compete and bring something new to the table.
Buying an online business for sale might be a great option for some entrepreneurs, and not the best option for others. Just like it takes a certain kind of entrepreneur to build a business from scratch and work through the long hours of hustling and grinding through the business creation process, the same can be said for an entrepreneur who’s ready to step into a thriving and profitable online business and is capable of scaling its growth.
Even though it might sound like an easier and faster route to success than building a completely new brand from scratch, there can still be risks involved. The upfront investment when buying an online business for sale is generally much higher than simply building a business from scratch, you may have to take over processes and systems that are inefficient or outdated, you may take on employees and there could be potential liabilities and legal risks imposed on the business as well. For these reasons, doing your own due diligence is of the utmost importance if you’re interested in purchasing an online business for sale.
For sellers, just download the Shopify Exchange app to your Shopify store and you’ll be able to add a store description and set a price from there. In order to set your selling price, you can use the Shopify Exchange valuation tool to find a recommended selling price which is based on your store’s lifetime revenue, traffic, social media followers and/or email subscribers.
Set up a merchant account. Service businesses in the past had to generally rely on cash or check—setting up an entire credit card processing system was a thankless, expensive task at best. Using a service such as PayPal makes it possible to accept virtually any form of credit or debit card for your services, and includes dispute resolution should the need arise (and it will arise).
This option eliminates the brand conception, monetization strategy and business model development, allowing you to jump right into business development and growth. While buying an established online business eliminates a lot of the early-stage foundational work, its success is still contingent on your ability to run and manage the business. If this option is appealing to you, here are three ways to buy an online business.