“Ben Leonard started an e-commerce business called Beast Gear,” shares Sam Thompson a Minneapolis business broker and the president of M&A firm Transitions In Business. “Ben describes how he used Amazon as his sales channel for 95% of his business. He talks in detail about how e-commerce businesses are valued and sold. Ben also discusses the process he went through when selling Beast Gear and how to make an earn-out work in your favor”.
Ben Leonard is a fitness enthusiast who found himself in bed with a heart problem in his early 20’s (he’s fit and healthy now). His doctors told him to rest. Said not to go to the gym, he cleared out his bag and noticed some of the accessories he used had worn out prematurely.
The experience sparked an idea. Leonard decided to launch a brand of fitness accessories made to last longer and cost less than the alternatives. He named his fledging company Beast Gear. He borrowed around £1,000 from his father and ordered 250 skipping ropes with the Beast Gear logo emblazoned on them.
Three years later, Beast Gear was turning over more than 4 million pounds — 95% of which was on Amazon. Worried he had become too dependent on Amazon, he decided to sell and got around three times the profit for Beast Gear.
Leonard shares much wisdom in this episode, including:
- How to build a brand “off Amazon.”
- A little trick Leonard used to build raving fans on Instagram.
- How Leonard used a chatbot to grow his list of subscribers.
- How to improve your ranking on an Amazon search.
- How to protect your brand.
- Multiples benchmarks for e-commerce brands.
- Why selling most of your products on Amazon could drag down your valuation.
- Why it’s important to “leave some meat on the bones” for an acquirer.
- What Leonard would do differently if he had the chance to sell Beast Gear over again.