Buying Online Businesses Podcast How To Value An Ecommerce and SaaS Business for SBA Acquisitions with Ryan Hutchins
Valuing an online business can be a complex process, especially if you're navigating different business models, price ranges, and niches. How do you know what an eCommerce or SaaS business is really worth—and how do you avoid the pitfalls that both buyers and sellers often fall into?
In today’s episode of the Buying Online Businesses Podcast, host Jaryd Krause sits down with Ryan Hutchins, a serial entrepreneur and business valuation expert. Ryan shares his experience as the owner of Peak Business Valuations and several other ventures, including plumbing companies, a multi-location bakery, a pizza restaurant chain, and even a stripping company. His unique background offers incredible insights into the world of business valuations, acquisitions, and investing.
Together, Jaryd and Ryan dive deep into SBA acquisitions, exploring everything from common mistakes buyers and sellers make to the key differences between valuing eCommerce businesses and SaaS businesses. They discuss the importance of working capital, how SBA loans are approved, and what business valuation firms like Peak Business Valuations look for in eCommerce and SaaS acquisitions.
Ryan also shares his thoughts on the risks involved in Amazon-based businesses vs. off-Amazon eCommerce businesses—and why some risks are far more critical than others. Whether you're buying your first online business or looking to scale your acquisitions strategy, this episode is packed with lessons to help you accurately value a business and secure the right deal.
If you're considering buying an online business—or just want to better understand the world of business valuations—you won't want to miss this episode!
Episode Highlights
02:00 Ryan’s journey on valuing businesses
10:20 Risks of owning an Amazon business
16:00 What are supplier risks?
23:00 How to value a business using an SBA loan?
37:00 Connect with Ryan
Key Takeaways
➥ eCommerce businesses tend to have higher risks if sales are Amazon-dependent, as Amazon can change its policies or suspend accounts. SaaS businesses typically have predictable recurring revenue, making them easier to value, but customer churn and tech support are key risks to consider.
➥ Dependency on a few key customers can be risky. If those relationships are tied to the seller personally, customers might leave when the seller exits.
➥ Working capital is essential. Buyers must have enough funds to maintain and grow the business post-acquisition.
About The Guest
Ryan Hutchins owns a business valuation firm, two plumbing companies, a striping company, a multi-location bakery, and a multi-location pizza restaurant.
Connect with Ryan Hutchins
➥ https://www.linkedin.com/in/ryan-hutchins-abv-am-cmea-peakbusinessvaluation/
Resource Links
➥ Sell your business to us here - https://buyingonlinebusinesses.com/sell-your-business/
➥ Buying Online Businesses Website - https://buyingonlinebusinesses.com
➥ Download the Due Diligence Framework - https://buyingonlinebusinesses.com/freeresources/
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➥ Convert Kit (Email Software Provider) - https://bit.ly/3o10Xgx
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