Building vs Buying eCommerce Brands w/ Andrea Balletbo – #45

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The Brand Builder Show
Building vs Buying eCommerce Brands w/ Andrea Balletbo – #45
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We all recognize that building a brand is a business model with great potential.

But what if you want to shortcut the journey and go from zero to a thriving, profitable business as quickly as possible?

Well, by buying a business you can do just that – fast-track the start-up phase. 

In this week’s episode of the Brand Builder Show, we’re joined by Andrea Balletbo from Boopos to talk about exactly how you can do that.

In this episode we talked about:

  • The advantages of building vs buying an eCommerce business
  • Knowing where to look to find businesses to buy
  • Evaluating businesses and knowing what to look for in an acquisition
  • Financing options available to entrepreneurs looking to acquire businesses
  • And a whole lot more!

⭐️ EPISODE LINKS ⭐️

> Explore Boopos

> Connect with Andrea on LinkedIn

Ben Donovan  00:00
Awesome. Well, hello, and welcome back to another episode of The Brand Builder Show. Today we’re actually going to be talking about buying businesses. We talk a lot about building brands on this channel. But today we’re going to be talking about buying brands. And to help me talk about that with you is my guest today, Andrea. Andrea. Welcome to the show today.
 
Andrea Balletbo  00:20
Hi, Ben, thank you for having me excited to chat.
 
Ben Donovan  00:23
It’s my pleasure. We’ve had a few conversations over recent months, about what you guys are up to. And and I’ll kind of let you share a little bit more about that. But it’s an interesting proposition. And I think really does open up this potential of buying businesses to a wider audience than may think they could buy a business. And so I’m, I’m thinking that this episode is going to maybe open some people’s eyes to the possibilities, making think about things a little bit different, potentially. So I am looking forward to that. But why don’t we start the episode by just telling us a little bit about yourself? The company that you’re working with how you managed to get there? And what you guys as a company, up to at the moment?
 
Andrea Balletbo  01:04
Yeah, absolutely. So I’m at Boopos, Boopos was the name of the company that we’re helping people acquire e-commerce and SAS businesses, e-commerce, both b2c, and Amazon businesses. And just very briefly about myself, I’ve always been in tech, I’ve always been in the startup ecosystem. I’ve been in the Bay Area, I ran a startup myself. And now I’m part of this amazing team that is offering the possibility, as you were very well mentioning of having just normal people like yourself, like myself being able to acquire a business that’s actually working and that it’s profitable, and given them the opportunity to grow that business. So what do we do as long story short, we’re the financing aid for this. So we offer financing for these acquisitions in the online space. That’s the core of what we do. The expanded version of what we do are more in detail as we’re actually kind of the advisors, the partner in analysis. So we take our buyers by the hand, from the beginning, from the deal flow, help them find the right business, we take no personal guarantees, we’re non diluted, so will tend to take most of the risk in these acquisitions, we want to make sure that businesses that they’re also adapted to the budget, the objectives of the buyer, so we help them find their business. We help them analyze that. And then when they’re ready to close, we’re able to finance the transaction in just seven days, way faster than a bank, everything you can very tacky. Right? It’s kind of the acquisition financing for online businesses. That’s what we do.
 
Ben Donovan  02:33
Yeah, that’s amazing. I think there’s been a lot of attention, rightly so in recent years, particularly last year, aggregators, buyers of businesses, and in our discussion a lot as e-commerce practitioners is, how do I build a business that I could sell. But I think, you know, the more people go through business, they realize that actually buying a business can shortcut so much of the hard yards, you know, because it’s, it’s just as easy to go, you know, not that I haven’t bought business yet, as we’ve discussed is one of my goals down the line to do so. But getting from zero to 100, is really hard. But then 100 to a million is almost like, you know, it’s almost just the same amount of effort, you know, zero to one is one to 10, there’s that compound effect of something that’s really moving forward. So I’m really interested to kind of hear your thoughts as to how entrepreneurs can really leverage this opportunity. But to do that, let’s kind of go back to the start really of this whole idea. Why should entrepreneurs if they want to own a business be their own boss? Why should they look at buying a business as opposed to building a business?
 
Andrea Balletbo  03:46
Honestly, I think you nailed it. At the end of the day, you can go into let’s take Amazon as an example. We’re just kind of, as you were mentioning, with all the process aggregators out there, it’s been the hype more lately, you can go into the Amazon space and try to sell a cup of coffee, and have to compare it with 500. Other sellers and move in other sellers that are already well positioned and try to scale your business from zero to 100. Right, or you can go into the Amazon space, buy something that’s working, that’s already selling exactly what he wanted to sell, and take it from 100 to a million. So there’s this component of hey, you can avoid the whole struggle of having to position your product, find the supplier, find the warehouse, decide whether you want to FBA or not FBA, get the ratings, get the click fast button all of that or you can buy something that already has that in place, and actually bring value to that using your experience to grow it faster. And then in that sense, when you’re looking to buy a business with the fact that Ubers been here, it also allows you to have the financing opportunity or capability to take something that’s working, scale it and then the return of investment down there. or if you take something from 100 to a million, and you’ve only invested part of your money into that is way bigger, right? That if you just start something, you work super hard to scale it to 100. And then you sell it for 3x. Hey, they don’t even realize when it’s not gonna be that huge. So it’s all about getting strategic and finding the right opportunity for each one, I guess.
 
Ben Donovan  05:20
Yeah. And this deal structure, I think, is something that really is interesting for people to consider. Because, you know, I think is one of the things that attracts a lot of people to say something like property because you can leverage the bank’s money to increase your return on investment. And this is the same kind of principle as what groups are offering, right is the way that Can you talk us through like a typical deal structure? Because a lot of people I think, when they think, Well, I’d like to buy a business, but I probably don’t have the capital to buy a six figure seven figure business, how much capital does it actually take? Can you can you break down a bit of a deal structure for us?
 
Andrea Balletbo  05:57
Yeah, absolutely. Let’s do something, let’s say just wants to talk with for a minute. And you mentioned something very interesting, which is the bank. That’s kind of the first thing that comes to our mind when we’re looking for financing options, either to start a business or buy a business. Now, and I’m sure anyone that’s listening to this, that has been looking into the acquisition space for a while has noticed this. But banks tend to be very skeptical when it comes to financing online assets, they don’t really see it as tangible, they don’t really know what to take as collateral, they can be very slow. And at the end of the day, the online space moves very fast. So you need to be able to refinance and fast to secure an offer fast to move fast. So upfront, banks sometimes don’t or aren’t, aren’t always the best option. And when they are, they’ll ask for personal guarantees. It’s not ideal, you don’t know what will happen. Suddenly, there was COVID. Just what last year. So you don’t really know what will happen right? Now, that being said, don’t worry about Boopos SP in that bank from for the online space. No personal guarantees way faster than a bank, so on, when it comes to the structure of the deal. The whole mission behind Boopos was to be able to help any entrepreneur acquire the dream business. So how much do they actually need to put down? Or what is the minimum cash? Right, which is kind of what you were asking, Do I have enough cash to acquire good business or not. So on our end, since we take no personal guarantees, no warrants, the minimum skin in the game that will require for buyers to having the acquisition with us, is either 25% of our lending amount. So let’s say that we’ll have 100k, they will just have to put 25k. And then maybe they could use a seller note for the remaining, let’s say 50. And suddenly, they caught up business that was sold at 175. And they just invested 25k, on direct, right, so it’s just 25% of our lending amount, or 15, one 5% of the total asking price, whichever of the two is bigger. So it’s really a minimum portion that can allow you to buy a great business, or a bigger business, let’s use another very simple example. seller financing. That’s also part of the hype, something that a lot of people use when they’re acquiring a business. Let’s say you’re looking at a business that’s priced at 600k. And at first you think that’s more than half a million. But hey, you can buy that business and just invest 100k, how you can get a financing partner like Boopos, putting 400, you just have to put 25% or $1, for every $4 we invest, you put 100k you use a seller note for the remaining 100k, you just got a business that’s worth 600k. And your investment was 100k. And you can apply the same model to different sizes, according to what your objective is, and what you’re looking for.
 
Ben Donovan  08:42
Yeah. And I think that’s where the there’s so much opportunity because people, a lot of people when they start a business, first and foremost, they want you know, J JRI, job replacement income, you know, they want to be able to be there. They want to just have enough to be able to do that. And but starting a business, it can take time. But you know, you mentioned they’re an example of a $600,000 business that should be generating somewhere in the region of one to $200,000 a year in profit. And so
 
Andrea Balletbo  09:13
even 300, then we’re seeing, it’s actually very relevant that you bring this up, because what we’ve seen as that, with the activity of most applicators in the space slowing down in the past year, multipliers have been stabilized and quite a lot. And whereas a year ago, we wouldn’t be having this conversation and you would get businesses sold or 4x 5x because there was an aggregator out there willing to pay 9x Nowadays, we’re seeing that the expectations of sellers and buyers are aligning. And multipliers for a good Amazon store can be somewhere around 3x 3.5x. So that 600k plus s might be generating 300 in profit and you just invested 100k So that was a very relevant point. What about it?
 
Ben Donovan  09:57
Yeah, yeah, and you know, obviously then you can immediately Stop paying yourself a salary, which with a startup business, you couldn’t. And then you’re going to get a return on investment each year with, you know, significant return on investment. So that’s obviously makes it very attractive. Now, obviously, there’ll be some costs associated with that. What would if someone was trying to finance an acquisition, what would the likely costs involved be?
 
Andrea Balletbo  10:22
Okay, so that will depend, of course, on the financing option. So if we go to the bank, banks will be slower than they for personal guarantees, and so on. And the US work a lot with the US was a little bit the UK anywhere really and around the world. But mainly that the US like the biggest market we have. And the first option that people think of is SBA. SBA loans, they’re the loans that the state will kind of protect and offer at very cheap prices. So that will be an interest rate of maybe around 10% 8%, super cheap up to 10 years, but then there are all the hurdles to actually get in that financing or getting in a competitive way. Now, if you go to venture depth, or venture equity, that will come at the cost of deluding yourself. So that’s also a cost to consider. If you use a financing partner such as Boopos. That will allow you to be fast, no personal guarantees, non dilutive, but it will also be kind of a premium service, that will be a little bit more expensive, right? So pre approval is just put in 48 hours, you also use as a pardon analysis as your free consultants or advisory. And in that case, how much the costs will or how much is the cost will actually depend on when the buyers paying back the loan. So just to clarify, we use a very different model to what you usually see an a bank, which is what allows us to be more data driven faster, take most of the risks and so on, we do something called revenue based financing. Have you talked about that in the past? Because before then, do you think the audio Okay, then, just let’s make sure we summarize, revenue based lending basically means that we lent X amount of money. And the way to pay it back is representative of the business revenue. Okay, this percentage of the business revenue is what we call the royalty. So whenever you hear me discuss about the royalty, whenever you read royalty in our website, that’s not an interest rate. So that’s not the cost per cell for loan, it’s just a unique monthly payment that includes both principal and interest. And that is amortization over time, until you pay back the loan up to six years in our case. Now, the whole idea behind this model is that it offers flexibility. So since it’s a percentage of the revenues, if one month, you sell more, you will be able to pay back a bigger chunk of the debt, you’ll pay back faster, no prepayment penalties. And that’s where we started out about the cost. If you sell less than a month, you’ll simply be paying less in a monetary terms, because that’s just less it will take you a little bit longer to pay back. So the way we designed it is to avoid penalizing growth, or to avoid penalizing buyers that might user financing as fast access to capital and then restructure with a bank, we have a multiplier scheme in place. This multiplier scheme is in place basically means that the total cost of the loan depends on what you pay in Buffalo, if that’s in the first year, and this will give you an idea of the cost. And the first year, if you were to pay off the debt completely at one point 15 times the amount you borrow. So let’s say that we lend your band 100k dollar threshold would have to be 115. Maybe your you bought the company in January 2003. During December, you’ve paid back 50k in royalties, you only have 50k left to pay, you say Listen, I’ll just pay this off from my own pocket or restructure with a bank or whatever. It was at a 50% interest. Pretty straightforward. Once you go past the first anniversary, that increases by 15% every year until the fourth year. So it’s one point 30 The second year, one point 45 The third year and 1.6. The fourth year, which is the cap. Does that mean we’re talking about a 30% interest rate or 45? Interest rate? We’re 60% interest rate? Hell not that’s crazy. Why? Because by the time you get to a 30 year, you’re accumulating three years of repayments that you’ve already done through the royalty so you’re spreading the cost around or along those three years. Yeah, my recommendation here to buyers as this allows you to get strategic. So you can pay back the loan at the beginning of the fourth year, what the end of the fourth year, what’s going to be cheaper for you. Yeah, so it kind of offers that flexibility. Do you think that was clear? It’s a very different model. So I do want to make sure that it’s very clear,
 
Ben Donovan  14:45
I think is clear. I think that is very unique and different anything that anybody may have heard before. So and it would take probably more than a conversation we could have on a podcast but I think the the key learning I think for me is a He will give all the links to check out the Boopos website at the end.
 
Andrea Balletbo  15:04
Also, you put them here in the subtitles.
 
Ben Donovan  15:07
Yeah, that’s it. Exactly. Yeah. And but also be, is there are a lot more creative financing options than people realize. And so the potential of buying a business is something that I think most people shouldn’t write off, especially when they’ve got some of the skills required to, you know, take a business that’s already got proof of concept, already got momentum and then grow it. So. So yeah, no, I think it’s really helpful. I’d love to talk a bit about the experiences you’re having with people that are buying businesses, and just Yeah, at the start of the journey, what how, when people are looking for a business to buy, obviously, there would be a number of options, how does someone that’s looking to buy a business choose what kind of business to buy or find that business? What was the right steps to take?
 
Andrea Balletbo  15:59
That’s such a good question. And it depends so much on every profile of person, right? So you get buyers that jump on the first conversation with you, and they know exactly what they want, they even have a target in place that they’re interested in, and then use that as proof of concept. So hey, they can bring you the target. You know, we were very fast and just 48 hours, we’ll be able to provide them with feedback, a term sheet that was fast, ready to go. And then you also get that other buyer, which is probably where you’re orientating the question more that wants to buy a business, but doesn’t really know what to look for. There are several resources in place. My first piece of advice, there is always just and you mentioned it yourself. Where can you add value? How can you apply your experience to grow a business, if you’re a great marketer, look for a business that is, of course already established, of course, business profitable, etc. But that has a low marketing spend. Because you know that just by pulling that lever, you’ll be able to grow it if you’re great with operations and managing efficiencies in the supply chain and product development may be prioritize low cost of goods sold, because that will give you more room to invest in that to grow the business, right. So think about what kind of value can you contribute to make sure to grow that business. Now, that being said, there are a lot of resources out there for deal flow. The most are the first one that comes to any new buyers mind is just broker sites, marketplaces, there are tons of out there, there’s Empire Flippers, there’s flipper, there’s quiet light, there’s website closers. There’s investors clips there, plenty plenty out there. And they all have a lot of options. It’s like buying a house, you can go to different real estate agencies, different realtors, there’s offer a lot. So you can just browse around that, see what appeals to you. And then when you’re working with whoopers as your financing partner, you also get to get her help and this analysis process and selection process because since we’re willing to take most of the risk and this acquisitions, we can finance a maximum of 80% of the asking price, we want to make sure that good businesses, so you can bring us the target that you’re looking at. And we can help you understand it as a good business or not. If we’re able to approve it, you already know that that’s a good business, hey, you already narrowed the search. If we don’t feel comfortable with proving it, we’ll let you know why we’ll say Hey, Ben, this one had very thin margins, they have been decreasing what’s going on? Or hey, this one had a very good peaks and 2021. But we’ve seen that it’s really slowing down. You might want to ask the seller why this is going on? Or this one spending way too much in affiliate content, does the product have value per se. So you also get that input from us. And, and simultaneously at the same time, because we also partner with all of the brokers and marketplaces out there. We also receive a lot of deals from from them. So brokers will be sending us their deals, we’ll look at them, the ones that we think are good enough. And that will last at least six years, which is the maturity date or knows, we’ll pre approve them. And we’ll post those on our marketplace that we have aggregated listings. That’s also a resource that our partner buyers can use to narrow down the search and just focus directly on businesses that we’ve already pre approved that we already have in there. Good enough.
 
Ben Donovan  19:22
Yeah, no, that’s really good. Really good. You mentioned declining revenues declining margins there. Are there any other what other criteria are you looking at when you are analyzing evaluating a business to purchase?
 
Andrea Balletbo  19:36
It’s a lot like our proprietary model is complex. Yeah, the two most important ones or the ones that kind of summarize the rest as first of all the product. So do we think it’s going to be a product that is going to be just as successful in the following five years or six years? So if it’s a product where we might see Some risky business in terms of ESG, for instance, we might say a waiver is does a product that has good reviews, how is it positioned compared to the competition? Does it have some recurrence or revenues in there that we might also want to take into consideration. So anything related to the product, we always recommend checking out. And then of course, the numbers, you always want to make sure the numbers make sense. And my motto here as one that I borrowed from a teacher had in my MBA, which was, hey, cash is king. So you want to make sure that it’s a profitable business, you want to measure the numbers add out, you want to make sure that hopefully, it’s growing. And then if it’s not growing, it’s stable, and they have some opportunity for you as it was in before to grow it, you want to make sure that the margins are not are not too thin, because that might be risky, down the road. If anything changes, if suddenly Amazon increases their fee, that might impact your margins considerably. If they don’t have a lot of room there, you might want to check out their cost of goods sold or not also over the top, you might want to start with the advertising spend. Basically, anything that you can see on a p&l is worth taking into account.
 
Ben Donovan  21:05
Yeah, that’s really good. You mentioned, you know, like a term sheet before, I’d love to know, the kind of the duration of this process, you know, someone starts looking at a business to buy, can you give us the maybe three or four main steps? Like, obviously, you don’t have to go into the minute detail, but eight main steps when someone’s buying a business? You know, like a letter of intent term, she explained it to me like I’m a five year old, how does the process work?
 
Andrea Balletbo  21:34
Absolutely. Okay, let’s roleplay it like if we were five years old? Exactly. Yeah, the value here, Ben, you’re just our business. Let’s take the final thing out of the picture for now, just to outline the process, very simple. Let’s say you saw the business or the mugs, and we’re talking before I’m selling the business, you’re interested in it. Let’s say you saw it on a broker site on let’s use this Empire Flippers as an example. And through Empire Flippers, you’re going to reach out to me, we’re going to start the negotiation process. So you’re going to ask me questions, I’m going to answer we’re going to talk about the valuation. And eventually you’ll come up with an offer, and you present that letter of intent with the offer. I think, Hey, I trust Ben, he’s a good buyer. And I think it’s a good offer, I’m signing that letter of intent. Now after the letter of intent will come the more of specific due diligence process. So now Ben, that you know that he has an exclusive time with me as your seller. And you’re my unique buyer right now on the table. Because we’re under a letter of intent, you’re going to go more into it as into the numbers, you might want to kind of match his account, make sure that what I send you over in a p&l actually matches what you can see behind the Stripe account or the merchant account, you might want to come to hire a third party provider for due diligence and so on. And then once you feel 100% convinced, you’re going to come through with an asset purchase agreement was signed up, or your funds will be transferred to an escrow account. And then we’ll start the migration process. How much does that last will actually depend on by your seller and on the business per se. On an average, we see the migration process last time around two weeks. During that time, my job as the seller will be to make sure that I’m handing over the steering wheel to you so you can run it without the business declining. Sometimes you might even convince me to stay with you for six months, one year, that will depend on the negotiations, the fact that by the time the migration has finished, the business is yours. And now that you’re owning this wonderful We Work Month business.
 
Ben Donovan  23:42
That’s amazing. And helpful, I think for everyone to understand the stages of the journey, because buying a business is obviously a huge thing. Selling is something a lot of us aspire to do one day and but that’s, I don’t want to say it’s easy, because it’s not but you know, it’s not as complex because ultimately, we just have to prepare our business as best as possible, and sell it for as much as possible. But when you’re buying you are investing a lot of money into this, which I think is where you guys bring so you unique insight, because you are co investing into this. And so there’s lots of new diligence that you’re doing. And it was very interesting to hear about that due diligence because you guys, you’re taking on a lot of the responsibility, aren’t you?
 
Andrea Balletbo  24:26
Absolutely, absolutely. So you cannot say any better. I suppose you could just do a monologue next time. No, but really, I mean, at the end of the day, we’ll be taking no personal guarantees. Right. So if the business doesn’t work out, we’ll take nothing else put the business preset and we don’t want to present that has no value. So as you were saying before, we are co investing, which is why we don’t see ourselves just as a financing partner, but we actually see ourselves as our partner. So we’re gonna help you find the right Do we want to make sure it’s a good enough business? Going to have your back during the negotiation process? If you have any question that you want to run through us, we’ll be here everyone helped with the restructuring the offer was we’ll be here, our success is based on the buyer success, it’s definitely a core investment. And at the end of the day, what we’re talking about, or what this means is that we’re offering leverage, right? So then you could have 100k, and invested 100k, and buying a business that’s worth 100k. If that person doesn’t go out as planned, you lost it all, kind of end up within those 100k. Now, when you’re using a financing partner, you have two options, you can buy a bigger business, back to the example business worth 600k. And you just invest in 100k. So hey, if that doesn’t go out, well, what do you lose is nothing proportional to what you had, and when you manage. Or you can also say, actually, let me diversify my risk even more. So let me buy three businesses that are worth 100k. I have Cooper’s finance 70%, I’ll just invest 30k in it. And you just call yourself a portfolio of three brands, which, obviously will allow you to diversify your risk. And then down the road, you were talking about excellent businesses selling them. If you sell three businesses versus just one, their return of investment, of course has tripled. Yeah. And you’re still invested just 100k?
 
Ben Donovan  26:26
Yeah, this idea of leverage is I think, really, really key. As you know, when people are just starting out in E-commerce, they just want to make some money. But I think the longer you go, the more you do this business, the more you realize there are opportunities to leverage other people’s money to put it, frankly, to be able to grow. Yeah, absolutely. You know, there are options that open up with that. So I think that this is I think something that a lot of people in time will look more at. When it comes to then the acquisition. It’s been completed. What’s what’s then the next steps? Does someone that’s acquired a new business? New what what are the key things that you would say they need to focus on, in order to really make a successful acquisition come to the fore? Is it just keep things going? As they have been? Is it to try and keep it as stable as possible? Or should they be aggressive? What What are your recommendations there?
 
Andrea Balletbo  27:19
So that will depend on the strategy of the buyer, right? If you’re someone that owns another business, or you have a full time job, and you’re just looking for a business that requires minimum time to maintain for some extra income, and you just want to sit on it, continue to make care go as it goes and keep it stable. That’s just as legit. Like maybe someone has a full time job at, let’s say, a real estate agency. They’re a realtor, they’re just trying to diversify into other asset classes, they buy something that’s already open work, and they just want to invest four hours on the weekend and keep it running, pay back the debt over those six years, and then eventually sell it and just make the whole benefit from the return of that exit, because they just invested 25% of our lending amount, or 15% of the total asking price that works, that’s good to go. Maybe you’re a buyer that is very experienced, and Amazon and E-commerce and you want to be very aggressive about it. And you know what levers to pull for growth, because you’ve done it before, go for it. If you’re able to repay the loan faster, you’ll get no penalties for that. You might want to buy three business at the same time, or use that acquisition to grow your own business because you bought a competitor. Right? So really, what are your focus should be after the acquisition is more about what is your objective with with acquisition? So are you looking for just an additional revenue stream? Are you looking to replace your income down the road? Are you looking? Are you viewing that as a portfolio investment? So really, anything is legit? It just depends on what you’re after?
 
Ben Donovan  28:52
Yeah, no, that’s really helpful. The I know I’m putting you on the spot a little bit here. But do you have any stories from people that you’ve worked with? Maybe they’ve acquired a business and seen some great success with it and some great momentum and case studies that you might be able to share with us?
 
Andrea Balletbo  29:13
Yeah, so my favorite case studies are those of buyers that have successfully grown a small portfolio of businesses just by using our, our financing to the point that they’ve evolved into becoming smaller aggregators. Right? So one of the first clients that we actually had was TELUS brands. I’m not sure if have you heard of them before. So yeah, like, I think they probably own like, five or six brands and they finance all of those acquisition with us. They started with zero brands, but the first brand smaller side, that’s big a first place second brand 100k their brand 300k by the Then they got to the fifth brand that was 1 million, hey, the portfolio you have the valuation of that portfolio just went from zero to five brands over a million. Now, if you want to go and raise venture capital equity or debt, you have a more stronger position to do that. And that’s for people that are thinking about roll up strategies eventually, during the holding company, or just like scaling it up pretty fast, pretty big. There are also cases in which we see buyers that come from backgrounds that have nothing to do. And I was talking about real estate before, because that’s quite of anecdotally a profile that we tend to get a lot, I guess, because they have that mentality or that mindset of, I’ll buy houses, and then sell them. And they think the same way from e-commerce and says I’ll buy online businesses, and then sell them. And I can bring to you one specific case, just because we have so many of buyers that we’ve been able to take them by the hand, help them find the right business. And eventually, they’re now growing it with the mindset of hey, I’ll sell this in 2 3 4 5 years. Right. So overall, it’s more, let’s view the question the other way around. We finance more than 110 deals just this year. Our loan book is over 30 million. Do you want to know how many defaults we’ve had from this more than 110? Deals?
 
Ben Donovan  31:26
Yeah, go on
 
Andrea Balletbo  31:28
Four. three of the ways we were able to restructure, so those business owners are still there running the businesses, truck fighting for the revenues, it happens. Like sometimes things happen. Yeah, just one decided to hand over the business, because they felt overwhelmed about it. So now we have one of our partner operators run their business in order to rescue it. So we’re talking about 40 faults out of 110. All of the other 106 businesses are success case studies. And I encourage anyone that’s listening here to just go on Trustpilot search for Boopos so that they’ll be able to read firsthand of different testimonials.
 
Ben Donovan  32:07
Yeah, obviously that speaks volumes about lupus but it’s also speaks volumes to anyone that’s doubting or worrying about the potential with it to see 110 deals, only four have defaulted. Which means the other ones are obviously making money obviously progressing is a super encouraging stat super encouraging case study in itself. For those people that may think to acquire a business one day. So no, that’s that’s really helpful. This whole thing has been very helpful and eye opening, to be honest with you. But is there anything that I haven’t asked you? Is there anything just to finish off that maybe extra you want to add or anything? Like I say that I haven’t asked, but you think maybe would be worth just mentioning?
 
Andrea Balletbo  32:52
Yeah, I think it’s worth mentioning that whoever’s thinking about acquiring a business or buy in and then building versus just building from scratch. I generally partisan just to reach out to our team online, on the website on the beautiful resources that you put down here are your with that, because as you were mentioning before, there are different ways to great creative, and we can help everyone find the right business for them. And even the right financing. So we’re also growing, right, we just closed our Series A back in September 68 million, and debt and equity, something we’re very proud of given the more challenging times that we’re at. And the fact that we are growing the fact that we see that we have the backup that it’s working. Also encourage us to expand our scope, and finance and options. So for instance, we still talk a lot about revenue based financing, because it’s what we do, but from the feedback of our buyers. And since our whole aim is to be useful financing. We’ve also found out that there’s a certain percentage of buyers, which for now is still minimal, that want to be very aggressive with growth. So they’re very concerned about margins, and cash at the end of the day. So what did we do? Well listen to that. We listened to that feedback, and we rolled out an alternative financing that we can also offer, which is a fixed term loan product that is up to four years, that will be more of a traditional interest versus principal 17% interest and the first year, it’s only the interest that you’re paying. So of course, way more room for cash to reinvest in the business and grow it. Then there’s a two point 25% amortization until the end of the fourth year, where you get the final balloon payment of 21%. In total, you’re debt free, right so we can find creative financing solutions, according to the situation of every buyer. My piece of advice is reach out if you’re thinking of it. We have a great team of advisory managers who listen to you will take you by the hand and guide you so that you can eventually successfully achieve your acquisition goals.
 
Ben Donovan  34:59
Amazing. Well, we’ll leave all of the links to do exactly that, as you say in the description down below the show notes if you’re listening to the audio podcast. Exactly, exactly. And people can check out Boopos, and we’ll leave links to connect with you on LinkedIn, etc, etc. Honestly, this has been super, super helpful. And Jay, the you’ve been? Yeah, brilliant guests. Thank you for coming on. Really appreciate your time.
 
Andrea Balletbo  35:24
No, thank you, Ben. By the way, I have one question for you. Oh, yeah, please. So when are we buying their business together? How is your acquisition process? Go?
 
Ben Donovan  35:34
Yeah, no, absolutely is a goal or dream of mine to do it for sure. I’ve just been so busy with, you know, a bunch of different projects that we’ve already got on the plate that I haven’t been able to sort of even get that way, I probably my goal will be in the next couple of years to try and sell a business and to then to use some of that capital to then buy something, because we’ve done, you know, a fair bit of the startup process. The challenge is that first phase because one little thing go wrong, like we’ve had a challenging year this year, with a particularly with a new business. And that takes us toll, you know, energy finances. And so I am in a position now where I probably don’t want to start any other businesses. We’ve got one other potential that I will maybe but then I don’t really want to start any more businesses again, ever, you know, because it’s so much worse. Much rather, buy something that’s already established. Even get somebody else to run it. You know, I think that’s the long term goal. So for sure, we will do it. Yeah, I promise. That’s I’m
 
Andrea Balletbo  36:39
looking forward to that. And then we can repeat this episode and talk about your experience. Yeah, that was
 
Ben Donovan  36:43
it. Sounds good to me. Sounds good. Awesome. Well, thank you again, Andrea. I appreciate you coming on.
 
Andrea Balletbo  36:49
Likewise, thank you, Ben.

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