I'm making this up as I go

When I set out to find and buy a Boomer internet business earlier this year, it was on a hunch:

You’re better off finding your own deal off-market than buying one off the shelf on Microacquire, Flippa, FE International, or some other brokerage.

I believed there were enough screaming deals out there that I could find one, improve it, and extract the value — like a classic real estate play, but for internet businesses.

I still (strongly) believe that — but, be warned: I’m making up all the other details as I go.

So, genuinely, take what follows with a grain of salt. My opinions are subject to change.

I aggregated questions I receive (here and on 𝕏/Twitter) and summarized my best responses.

Starting off with a banger. I’ll just say… I do not have enough cash to buy most of the businesses I’ve looked at.

And I don’t have plans to do a personal guarantee. That leaves me three options:

1. Steal

2. Beg

3. Persuade

Stealing is illegal, so that’s off the table.

But, I can beg (owners for seller financing) and persuade (partners to invest in screaming deals).

I’m going to rely heavily on owner financing.

I’m targeting a type of owner who is more willing to finance than one might think. They’re financially set, tiring, and prioritize a trusted transition over top-dollar.

That’s a good recipe for me.

I’m always looking to find partners — some of whom might become investors one day. Money is a commodity but good partners are not. It’s on me to do the work to show I’d be a good partner in order to attract good partners. That’s my best persuasion tactic.

Here’s my criteria (ranked by level of importance):

1. Mismanaged — significant and obvious improvements for a hungry operator

2. Digital component, if not completely internet-based

3. Long lasting (I like internet businesses that started in the 90s)

4. Bought right (I want to “make money on the buy” as they say in real estate)

5. $50k - 500k Seller Discretionary Income, bought right

I like the range I’m looking in.

It’s small enough that it’s usually owner-operated, so they are working in the business instead of on it. Some see that as a downside. I see the potential to grow it once you're able to get your head above it.

Most professional searchers / PE won’t touch these small businesses. Their money is better spent on bigger acquisitions.

I think there are easier 10x wins in a 250k EBITDA business than a 2.5m EBITDA business.

And, candidly, it feels less scary.

10x it.

I’m not trying to sell the secret recipe, but I’ll just say:

You want to look where owners are. There are tons of places you can look. I’ve found a few good ones and pulled on those threads.

I’ve hired two VAs to do all the thread pulling.

Referrals have been helpful and I’m hoping will compound over time (as relationships and reputation increase).

The first step is identifying the type of business you want to buy. The more specific you can be, the better.

Maybe partner with a broker?

I don’t know yet. Open to ideas.

Maybe share the leads directly with folks like you. If you’re in the market for something very specific, tell me.

I want good outcomes for the owners I work with. My whole strategy is predicated on relationships and trust. I will not jeopardize that.

So, it will largely be dictated by the owner’s desires.

Thanks for the questions. It really helps me clarify my thoughts and increases my conviction.

Early next week, I’m traveling to Wisconsin for my first in-person visit. Update on that in two weeks.

Mike