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What to Expect when Buying an Internet Company

Posted by Digital Market Group Adams/Freedman in Articles

While we focus our firm and its brokers primarily on the representation of Sellers, we also represent and spend a lot of time with Buyers. Why? Because they often are looking for guidance in helping them buy an online, digital business and we are happy to help. There are all kinds of buyers out there. Some buyers have worked in professional careers for a number of years and allocated parts of their income in the hopes of one day either starting their own company, or buying one. Other buyers might have a partner that already makes a stable living, so a business seems like a good idea. Still others are those that have already owned their own business, and they’re looking to scale.

No matter the buyer, every business acquisition is different and every business is operated differently. To add more confusion to the mix, most Buyers and Sellers are very different people with far different viewpoints on how the transaction should be completed. Because of all of these discrepancies in styles, mannerisms, expectations and culture, it is imperative that a Seller be represented by competent agents that have experience as a broker in the Internet sector. That’s where comes into play – with experience buying and selling companies, brokering millions in deals and operating our own multimillion dollar Internet companies, we are in a position to help buyers and sellers with their expectations during the acquisitions process.

For Sellers, we can help be that important intermediary – especially for those buyers that have limited experience in the Internet sector. Our brokers can help make the initial discussions go smoothly so that the parties are comfortable enough with each other to go to the next stage. Additionally, there are a number of tire kickers out there – those that have always wanted to own their own business, talk about it constantly, but when it comes down to pulling the trigger, they can’t do it. These buyers can waste your time and good brokers know who they are and can steer away from them by interviewing them prior to initial conversions with the seller. Since there is a lot of interest right now in getting into the Internet sector, a good broker can discern between the good, the bad and the ugly and only present buyers that are ready, willing and able to buy a business.

For buyers that have never owned an Internet company, it is recommend that a certain element of research be performed before beginning the due diligence phase. This will also help in the take-over of operations phase. eCommerce companies are operated similarly to Brick & Mortar companies. Both advertise, both usually have office space, both have suppliers and both have an element of customer service. For one interested in entering the eCommerce sector without experience with and an understanding of Google’s algorithms, it would be wise to partner with an optimization firm that can help ensure that best practices are followed when building content on and linking to the site. There are other professionals available to help with Pay Per Click advertising, Social Media Advertising, Comparison Shopping Engines, CSV and Data Feed development/management, inventory management, email marketing and much more. Partnering with the right teams and discussing options with them before moving into the due diligence stage is a wise move. These days, most eCommerce operators have a number of third parties or internal staffers helping with these items, so it’s very likely that some of this is already in place.

Again, the brokers at own and operate, buy, and sell a number of Internet companies, so none of this is new to us. We can help make both the buying and selling process smoother by adding an element of knowledge to the mix that very few other brokerages can offer today. For more information about us, just give us a call at 1-800-251-1559. We’re always here to help.