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how should I sell my business?

by samuelford
15 replies
I have a list of 5,000 UK home addresses of buyers of my affiliate / internet marketing promotions.

Just running simple direct mail campaigns to this list was giving me about $4000 profit each time and I'd do one every month.

It was a great little earner and income, but I have now started a new business and can no longer dedicate any time to this.

I want to sell this database so that someone else can take continue to make money from it, and i dont want the hassle of renting it out.

Where is the best place to sell this?

I'm not looking to make a huge amount from the sale but don't want to give it away for a pittence.

Thanks guys.
#business #sell
  • Profile picture of the author Jason Kanigan
    I think you should hire someone to manage it for you and keep it, since it's a proven moneymaker. Not everything you or I do will be a moneymaker.

    Even if you pay $1000 or $2000 a month to your outsourcer, you still make a profit for doing nothing.
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  • Profile picture of the author Aaron Doud
    Second the hire someone to manage it. Don't sell a business that is profitable. Hire someone to run it. They make money and you make money. It is a win win.
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    Aaron Doud - Sales & Success
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    • Profile picture of the author BigMak
      On the flip side of the coin:

      Wealth isn't crested RUNNING businesses, it's created by SELLING them.

      A solid business with systems in place can retrieve 4-5 times earnings.

      If (and it's a big IF since we don't know many details of your business)
      you sold for 4 times earnings, you could receive $192,000.

      Now, granted, I'm aware this isn't a typical brick and mortar business, but
      I'm just trying to make the point that real wealth can be had by selling
      a profitable, systematic business and then re-investing.

      Rinse and repeat.

      -Charlie
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      • Profile picture of the author Aaron Doud
        Originally Posted by BigMak View Post

        Wealth isn't crested RUNNING businesses, it's created by SELLING them.
        I completely disagree as do the truly rich people in this world.

        Zuckerberg: Would be a millionaire but not nearly as rich if he sold Facebook like everyone thought he should.

        Walton Family: Richest family in the world by owning one company.

        Buffet: One of the riches men in the world by buying more and more companies.

        Branson: Created company after company.

        Gates: Created one company and made himself one of the riches men in the world.

        Any one of these people could have sold out. But all of them realized you build companies and hire the right people to run them so they continue to make you money.

        You can make a great living building and selling companies but sooner or later you have told hold on to them to become truly rich. The dot com era was the execption to this but that was because people inflated the prices of companies that had no profit model. So the smart people back then like Mark Cuban got out when they could with the most money they could. Of course he used that money to buy and hold real companies.

        So if the business makes money and it is worth doing and expanding you hire people to do it.

        People need to stop building jobs and start building companies.
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        Aaron Doud - Sales & Success
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        • Profile picture of the author BigMak
          Aaron,

          You've misunderstood what I was trying to say. Maybe I didn't articulate
          my thoughts well enough.

          I honestly don't think the OP's small business should be compared with
          Gates, Buffet, etc. That's not what I was referring to, and I apologize for
          not making that clear.

          I was just trying to offer a different point of view of how wealth is created,
          and an alternative that he can consider.

          There is NO DOUBT much money is made by selling a business and reinvesting
          for passive wealth (ie. stocks, real estate, etc.). You create cash flow that way.
          After a time of doing this consistently, you DO have wealth created.

          That's all I was suggesting. Just opening his eyes to another alternative.

          Also, although the VERY WEALTHY like some of those mentioned above are making
          millions running a business, Buffet, Ted Turner, Michael Dell, Richard Branson and others
          make their BIG money when they sell a business. That's when it's realized.

          For smaller players like us on the WF, building a business and selling it is absolutely
          a viable method for large cash flow gains to reinvest either passively, or in building
          another business.

          I was just offering another viewpoint. That's why this forum is great!

          -Charlie
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  • Profile picture of the author Nino
    That's a pretty good asset which I don't recommend selling if it can give you this kind of cash.

    What you could do is build a real business on that database -like an ecommerce store? (i don't know what are they interested in) but this way in 6 months from now you would have leveraged that list to such an extent that it will give you a better multiple when selling than the you would currently get.

    So instead of selling it now for 6 months x 4,000 =24k... you could sell in another 6 months for at least 4,000 x 18= 72k.... so I definitely don't advise you to sell it because whatever you do from now on... it can seriously multiply your selling price.

    PS. Chances are that once you see the business and the bigger potential of the business... you will never sell it but instead make a few hundred thousands.
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  • Profile picture of the author bizgrower
    The particular business sounds like it's valuable because of you personally.
    Therefore, I'd keep it and hire someone to run it with you approving the communications and style. The cashflow could be handy to fuel your other businesses, or in case the
    new venture is less than successful.

    Dan
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  • Profile picture of the author Aaron Doud
    Every one of the people I named had a small business that some would say wasn't worth keeping and they should sell out to someone else.

    That is my point. Why sell for 6 to 24 months of earnings when he can hire someone to handle it and maybe other parts of his larger company? That way he is making the earnings off it for life.

    That isn't even getting into the fact that most people don't want to buy a job and the current business he would sell would be someone buying a job. Though someone could buy it and hire someone to do it like we are suggesting the OP do himself.

    The people I named are super rich because they kept building their businesses. They understood that to build a business means hiring people to do the job not only for less than you are worse but to also do the job better than you could. The OP could hire someone for $3k a month and still have $1k a month of relatively passive income. He could also continue to build that part of his business while doing little actual work himself and turn it into a $10k or more per month income stream.
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    • Profile picture of the author Sys4
      How would you go about finding someone you can trust with your list? It would be so easy to copy a list of that value. That kind of temptation can make good people go bad.
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      • Profile picture of the author Aaron Doud
        Originally Posted by Sys4 View Post

        How would you go about finding someone you can trust with your list? It would be so easy to copy a list of that value. That kind of temptation can make good people go bad.
        Hire someone who can handle it but doesn't understand the value of it. Don't let them know how much money it makes. In fact make it seem like a loss leader which is why you can't put your time into it.
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      • Profile picture of the author DaniMc
        Originally Posted by Sys4 View Post

        How would you go about finding someone you can trust with your list? It would be so easy to copy a list of that value. That kind of temptation can make good people go bad.
        Don't give someone the full keys to the kingdom. He doesn't need to give them the full list. He can maintain control of that aspect and have someone else do everything else. Or, have two separate people who do not know each other. One has all the processes, the other has the list.

        The first person just sends the info to a Google folder, the second person simply takes from that folder and does their portion. There are ways to protect trade secrets by dividing labor.

        Personally, I would keep the list private. Seems to me that is the last step in the process anyway, just before mailing.
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  • Profile picture of the author samuelford
    Thanks guys, a lot of food for thought here. I see where both opinions were coming from aswell, and there's a lot to be said for both approaches. Goona have to have a real good think about what I do...but outsourcing to a manager does seem like a good option as long as I dont have to spend too much time managing him.

    Thanks Again!
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  • Profile picture of the author Mohit Anand
    The real issue in hiring someone to run this business is that whether the person can be trusted with 5000 profitable E-mails. I guess OP would be better off by selling it than hiring someone. However, another question is whether it is legal to sell the list.

    Also, the list might be profitable for the OP, however, worthless for the buyer. As it is the OP who has built the relationship with the list.
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  • Profile picture of the author TeamBringIt
    If you make 4ks a month with single mailings, then increase the mailings or hire someone to do more mailing for you. I understand that, such a reliable business is great to keep, but selling it-- can also bring you in TONS of money. Sell the business for 10-12 times and then possibly start another business.
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  • Profile picture of the author DaniMc
    You are very close to making the leap from business owner to Entrepreneur. I would NOT sell this business. Here is what I would do:

    1) Document your exact process for running this business, then hire a COMPETENT person to manage it.

    2) Document how you CREATED this business in the first place, step by step, and then do it again. This could be a different geographical area, or a different niche product. Teach someone else how to do this process and pay them well.

    In a years time you could have 10 of these businesses running with not much time invested. Take that $4k monthly profit and build it into $40k monthly by leveraging the time and talent of other people.

    Always remember two words: Scalable and Repeatable

    When I am working with my clients, I say those words every five minutes. Make every single task scalable and repeatable and make sure you hand it off to someone else as quickly as possible.
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