CEO Update - Buyer Data & Valuations Insight

A note from Blake, Flippa CEO. [flippa_dark] March 24, 2022113/d2q1V504/VWxWXK8ClVhkW2_2Dkc9m0M2hW8GDvjX4H1LCjMkNllD5nCW9V3Zsc37CgYkFW3P6FgW7XjvCxW83ynSv2FVZRHVPR0Qr65gKMSW61yYKP10Cg8DW38jtBZ8Bgt9SW1V-t9l40_3ndW4YMRDH5zdzWCN2mD2qNsPbfnW89PNVz8B48FBW2G8hPH642l71N2gtG1xf5FJ_W56cpTN4DgqLlW6jLVxN5zMDp_W8RgJf32j8-WkW1dBPfS39GHhJW5gswTn3yHVQMW5z4f6B2L6WVQVvkspz6pq8KdV_Ch-j2PnQJPW75Xl502P_kpfW4gGtP68_XZzXW7DT0hJ36YypBT_BY31WNGC3W5766vx5d5nVsW3PXzPB3Vg90_VYG95p14pDJYW6HT-jT7_b2PSW5jrMv21B4Wg5W4hTQL04mMLQcW7qZP6P8DKdltVLSthf7KZtV8W3TsLX1261PvhW8brK0-8QKHK_W8xqR1h1ZKXWhW8kC4415zDyn2W8_wC474xYRWXW5-R8lv957hpdW8Y-0363xK9dDN7Wh86Rk6QQKVnj9SX552CKTVXQGBy5SRDCnV-z9G65frdry31tz1 [The-Daily_blue] From the CEO:113/d2q1V504/VWxWXK8ClVhkW2_2Dkc9m0M2hW8GDvjX4H1LCjMkNllD5nCW9V3Zsc37CgZ7NW2vqKKh2SwtG3W5X5LJz5jXNxCN6cmlMxp76t5W59ckt963rlQ5W8Njmtz2bh1zfW3tQzSs3P55-bN3rC7k6cXhy3W3jwpzZ3_7JPpN19Q3PX99YNzW1sVhV-2yfhVLW3r4t7V4RsMhZW3M41R425bZ35W4BpNb81n-cXKW5fD01H65BG1pW7B9MRW66SVDkW2FVtTN2hXz8sW5Qrn743TC1MwW5h-8MK68TT84W8NVbpc2W12pLW6Z2PtB3yqKbpW4H2z3P82ZWdNW8B_qWz8dxhhWW7cHzg_2Q0ghRW2gPQZt2G3YcnVVBr328kkDSTW6s4WCN650B1jW2x81Z65cwmK1W5fCkpH5r0Vz8MF81pMq4YsqW6xYyT74wF9_DW1gcxcZ57fnGzW183lZb2yTzchW266wwc8VylTWN51f1bzLKXKSVlg9HN6RMJV1W5sPmty6V9qT0N32y_R9Z8ztWW1jwF2z4b6rWGW5cYN7K5ZclrpW379x2k4Hd1CsW8sSJGx8Z2gQpW54RxPb6lfZ6D3qkZ1 In this edition, I’m going to lift the lid on some of our buyer data and reveal valuations for five very different, recently completed deals. It seems that 2022 is the year of opportunity. The Cambrian explosion of new online businesses of almost all types and the growth of major ecosystems has the world awake to this alternative asset class. For Flippa it’s enabled us to double down on our position as #1 as we continue to build the investment bank for the 99%. As the quarter closes, our transaction volume is up 495% on the same period prior year, stimulated by record buyer demand (again!). And, I am also pleased to say we have recorded a Net Promoter Score (NPS) of 60. We measure our NPS 90 days post sale and we are delighted that both buyers and sellers are as happy as each other. For those interested in Net Promoter Score and using it to assess their own businesses I highly recommend reading the Qualtrics article [here](113/d2q1V504/VWxWXK8ClVhkW2_2Dkc9m0M2hW8GDvjX4H1LCjMkNllD3q3n_V1-WJV7CgYd-W81L2cV3TbKXGW5qz3SS6VCY8lW1QYs3k1mlmcNW6J4LVy2bw6_0W2bRsvj1hjVsdW9k6Lbg7zXPylW96WtKM8PwHphN3rtMpwKtYJxW6b1_yG5fW-12W9frFFf1_Xx_-W3rQZrC90mnBDN7YjTb3Y1MnSVsnBqv6gjY73W46ZlCY3GGhCMW1V1TbK25FzB2W5tgXQy3n3F84W7Mk7kZ5_GsT6N5RNSwGVYqqTW5XbF4p9jCp7_N87QtST5tPDLW5QPrL37dPYQHW8vP1jz7_ymXMW7F5pFM4RsGl_W7lDDQq5tm-f4N1tSjmyd92sHW3rLC2b6fBrQ43jrv1). Now, the real stuff. This quarter alone (Q1 2022) the new buyer wallet represents $32.5BN and the follow on effect means more competition for good deals. Private Equity is competing with aggregators, high net worths are going head to head with other institutional investors and there’s frothy demand for maturing asset types. Take apps for instance. There’s a surge in demand as 1000 app publishers earned 1 Million or more for the first time ever and total Android and App revenues exploded 19% to $133 Billion (source: [Business of Apps](113/d2q1V504/VWxWXK8ClVhkW2_2Dkc9m0M2hW8GDvjX4H1LCjMkNll13q3npV1-WJV7CgX7QW4sNn8R3Q5nB5W4J3d0C22qhRrN4LKlR1L8hg7W2CBnPx5sRM9VW5Z3qcS215ntjVNcgdf8BkH0WN8RfC72XWW-QW8dQ0w05KjXXKW6cxR6M5gwDj0W9g2N4M7tZr14W3R0kdH5WVF2dV4rZvp21tZ1qN229y0bBrvpDW3DzT7P6k2l3jW3fV4pN7Vk_K2W21--Qt3y3xJKW2xvWZ962-qTrW6bDgjm2lY8jLW5gqzCC5YgwJnVgLs2m2WTqgRN5vN5BKdR7mpW7-6yxt70Rq0836pY1)). We actually saw our biggest app deal this quarter. A Singapore based portfolio of apps generating $12MM of revenue and growing ~30% annually was acquired for upwards of $30MM inclusive of upside payments from an international app publisher. I’ll go into more detail on actual deal values below but for the moment, let’s break these buyers down a little - For the period January to March 23rd: - 30,774 buyers joined Flippa - 14,107 completed profiles and were broken down into three buyer types: - Company - defined as an established organization looking to grow through acquisition - Entrepreneur - defined as a full time entrepreneur looking to own and operate - Side Hustler - defined as a prospective buyer looking to earn a side income - Companies only made up 8.9% (1,255) of overall buyers but with an average budget of $3.9M, this cohort dwarfs the other two - see chart 1. - 76% of Side Hustlers intend to buy more than one asset. This is interesting. Side Hustlers tend to buy multiple assets. They run them all separately - typically content assets or apps - and they amass small fortunes - see chart 2. Chart 1: Buyer type by average budget [Chart 1] Chart 2: The number of assets that each buyer type wants to acquire [chart 2] If you would like to receive more data on the Flippa buyer set, we will soon publish in-depth insights, so drop me a note at CEO@FlippaMarketplace.com and let me know what you would be interested in seeing. And, consider setting your preferences. [Have you set your preferences yet?](113/d2q1V504/VWxWXK8ClVhkW2_2Dkc9m0M2hW8GDvjX4H1LCjMkNllk3q3nJV1-WJV7CgQ6sW8WjLnw3NHtPKW86lw1-89Q3ZkW7s85ZC5CRj2LW3NlzSn1JcSwzW4nR36B2RCqjHW3vZkBq7k9lfhW8Ws1mr535PcSW3r17Vb1yp5jLW1kCDs65Q9hgwN4gZ4_Hm9nNGW2wKwvW484v86W5TMwfY6RT8y8W5p0NJb4QVYsnW2PLjsx4ZJxSKW7Z3Sr_5jTh4GVV-9VZ2ywdnPW8sbVPm3QBdPbV8JMGZ4rcVVqW8kTqcS31v2sPW4Lz8q_1gNN_-VP7FTC70TJt9W7f-VJ41b6XgqW1YdFKw3YnN8_W7G9vCZ3W3QBC39T31) For more personalized recommendations and to improve your best match, set your profile and preferences. Now for some recent valuations. As many of you will know, valuations vary wildly based on business model, performance, age, niche, defensibility and predictability. Accordingly, I have picked a variety of sales from an $8.5M education site acquisition to a $47,000 soccer forum. $5.2M Sale | Multiple: 7.59X Trailing 12 Month Net Profit | Model: Adsense A 13 year old content website, generating Adsense revenue of approximately $57K monthly sold for 7.59X trailing 12 month net profit. The $5.2M asset was incredibly consistent, more passive than I have seen most and still with upside. The seller is based in New Zealand and the buyer is based in the United States. $8.5M Sale | Multiple: 6.4X Trailing 12 Month Net Profit | Model: Ads & Subscriptions 5 year old advertising and subscriptions platform targeting teachers with teaching kits and aids profited $1.3M in the trailing 12 months and was acquired for $8.5M. The asset had a staggering global traffic base attracting between 20-40m users monthly. The seller is based in Italy and the buyer is based in the United States. $190K Sale | Multiple: 2.6X Trailing 12 Month Net Profit | Model: Amazon KDP2 year old Amazon KDP store with 40 books. With over 2000 reviews the store targeted Italian language customers and distributed on Amazon Marketplace Italy. The seller is based in Italy and the buyer is based in the United States. $275K Sale | Multiple: 2.0X Trailing 12 Month Net Profit | Model: Ecommerce 17 year old ecommerce store operating across Amazon, Shopify, Ebay and Walmart generating $11,000 monthly on a 43% profit margin. The $275K asset has a very strong repeat order rate and operated in the growing plus sized fashion industry. Both buyer and seller are based in the US. $47K Sale | Multiple 2.35X Trailing 12 Month Net Profit | Model: Ads 18 year old soccer forum site with extraordinarily steady traffic generating 300-500,000 page views monthly and a very strong keyword long long tail, generated $1700 monthly and sold for $47,000. The seller is based in the UK and the buyer is based in Canada. For a more in depth valuation and to set up a consultation with the team, you can get an indicative valuation [here](113/d2q1V504/VWxWXK8ClVhkW2_2Dkc9m0M2hW8GDvjX4H1LCjMkNllk3q3nJV1-WJV7CgSFNW376z9h21wMmWW1BbxRG99-75pW2tZHxC6__M_cW9fqv3g2hhPSqW9fsRcT57tdg_W6_VJQs3XrJFsW4t1NkN4SwySXN4hkkv1czg4HW8j4N_k2P7KmdW5MD1882R5B03W5stXxj9hbfK5W31LL7V39SP5hVWHC8B3gQ1RSW6P_gZv7ySBYsW53kRbk84P692N73tLF4SC2F5W45wZJ85blY37W4YJ2Pz1dHLlGVKcdyn7MzkhWW47Wkkl8H2VWfV5R-c36_bSwXVZnCnY6_B4vCW7qKFSY8tTRM3W6w6J3M3wnbqc2-41). Thanks for reading and I hope this was useful insight. To get in touch directly feel free to get me at CEO@FlippaMarketplace.com. Regards Blake Don't want The Daily Anymore? You can receive emails with the best listings for sale on Flippa every day, week or month. 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