The Evolving Art of Profitable Acquisitions With Dom Wells [Ep.147]

Oct 24, 2023

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Spotting a promising acquisition is just the beginning. Figuring out how to make that acquisition thrive is a whole new challenge.

Dom Wells has cracked the code for both. Dom is the founder of Onfolio, a company that specializes in buying and nurturing profitable online businesses.

Since Dom's last appearance on the podcast in October 2022, shortly after Onfolio went public, the company's revenue has surged from $1.2 million to nearly $6 million.

In this episode, Dom returns to discuss how his acquisition strategy has evolved. He's shifted away from content sites and instead focused on acquiring agencies, WordPress plugins, and digital courses.

Why the change? Content sites are excellent traffic assets, great for cultivating audiences and communities, but they come with a notable drawback—the vulnerability to AI and algorithm shake-ups.

To mitigate this risk, Dom advises content site owners to pivot beyond SEO and affiliate revenue. They should explore innovative ways to build their audience and convert it into a thriving community or media brand. One effective approach is to channel traffic toward additional revenue streams like newsletters, digital courses, or eCommerce stores.

Dom also walks us through how he goes about acquiring businesses, from the characteristics he looks for in a business to his preferred deal structure and how he sources CEOs to run those businesses.

Finally, Dom shares his insights on current market conditions for sellers.

He believes the market is unlikely to return to the high valuations of 2020/2021 any time soon. Therefore, entrepreneurs who have a large chunk of their net worth invested in their businesses are shouldering enormous risk by delaying selling their businesses in the hopes of waiting out the market.

Don't miss this episode packed with valuable insights into the world of acquisitions and the evolving landscape of online business!

Topics Discussed in This Episode:

A brief breakdown of Onfolio's business model and history (02:26)
The characteristics Dom looks for when acquiring businesses (05:05)
Mitigating the risks of running a content site through diversification (08:37)
The benefits of buying an agency (17:00)
The metrics Dom looks at when valuing an agency (22:45)
How Dom sources quality CEOs to run his businesses (29:13)
Dom’s approach to CEO onboarding (37:20)
The characteristics of a good CEO (41:00)
Dom’s ideal deal structure when acquiring businesses (45:34)
Dom shares his outlook on the current sellers' market (47:53)

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Sit back, grab a coffee, and learn how an acquisition pro approaches growing his portfolio!