3 months ago, Tiam and his M&A team presented a one-of-its-kind deal:
- acquiring a Content Site for $322,000
- adj. L12M EBIT: $100,000 -> acquisition multiple 3.2x
- great stats, upward trend, low volatility, lots of low-hanging fruits
- 100% Seller-Side financing, zero down payment
- quarterly payments over the next 3y -> besides the payment deferment from ad/aff revenue, the site might actually finance itself
š We pulled the trigger and could already boost the site’s performance
Nevertheless, I would NOT recommend specifically looking for 100% seller-side financing deals.
Why?
1) Needle in the haystack: We’ve looked at hundreds of deals and, at a regular level, 100% seller-side financing might not be attractive for the sell-side. In this case, there was a unique situation with tax implications, that made it possible
2) Opportunity Cost: Don’t waste your time chasing near-impossible setups, which might ruin your reputation in the market
3) Speaking of reputation: We’ve been talking to this founder on/off for 2y, it was an off-market deal in Europe, we acquired assets very close to this one (with bloggers, obviously, talking about this) and we have a very strong standing in this market, meaning almost every affiliate with a >$100k net profit asset might know us personally or has at least heard from us. In combination with the personal needs of the seller, our M&A team got creative and came up with a very favorable solution for both sides
š§ The cold hard truth is, besides what some influencers or news outlets might tell you and quite correlated with FE International, Inc.’s stats about financing structures: The most likely structure might (still?) be a cash-down payment + a performance-based or seller-financing part.
But every seller is different and comes with a different set of expectations. At TreasureHunter, Tiam and his team are embracing this and always looking to come up with a solution, that’s a perfect fit for the seller’s needs, working hard to be the “Favorite Buyer” by not thinking dogmatic about restrictions/ what’s the norm/ “industry standards”, but by putting the seller first ā¤ļø