January 1, 2021

Buying a $300MM revenue business for $31MM?!

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Buying a $300MM revenue business for $31MM?!

Unconventional Acquisitions

January 1, 2021

Look who is buying businesses.

This IS WILD. Tai Lopez bought what business?

And a totally repeatable model (but at smaller scale) for us to learn from in the world of business buying and thinking about opportunity in a 21st century world. 

Buying online businesses is fascinating because of the low acquisition cost. We have a whole segment on that in our Unconventional Acquisition’s course.

Especially how to buy them for $10k or less that profit $500-$1000 a month, all the way up to $1MM profits a year. 

Back to Pier 1 (that sort of out dated – Karen frequented – home goods store that felt like a garage sale meets Target in the strip malls of America), went belly up. 

That part I don’t think surprised anyone, they made losing hundreds of millions to online retailers like Wayfair, and mega-stores like Target, their business model. Another retail casualty in a world of big players going to Chapter 11 Bankruptcy is they can’t make the pivot to e-commerce gobbling up storefronts across the world.

That’s old news, here’s the interesting part. Typically what happens in big business bankruptcy is a big private equity firm gobbles them up (that’s how PE assets are worth $4T+ dollars – as a comparison the US economy is $20T, so not nothing). PE owns the world.

Here are examples of just those retail companies owned by PE in distress, but the list is much longer including Toys R Us, Petco, Staples, Dollar General, Claires etc etc etc.

But in today’s world PE lost out twice this year, and to whom surprised the sh*t out of us.

A company called Retail Ecommerce Ventures LLC won the Pier 1 bankruptcy auction. Before I tell you who, let me tell you how it works–when a large company like that goes bankrupt they go to auction and the “stalking horse” i.e the bidder on the assets, goes head to head with others for that company’s parts. Sidenote: finance is so funny – stalking horse, dead cat bounce (aka small rally after sharp decline), suicide pill (a takeover prevention tactic that results in company going under). Obviously our work in spreadsheets is RIVETING, so we try to pretty the pig. 

I digress, in this particular game of horses and cats, the presumed winner was to be PE firm Sycamore Partners who sits on a cool $15B of assets. Instead this guy won:

Tai Lopez Bought Pier 1?

That’s Tai Lopez, internet marketer extraordinaire who seems to spend most of his time on his phone in front of overpriced transportation modes and bikinis. 

The interesting part is he, and his partner under Retail Ecommerce Ventures LLC, paid $31 million to acquire Pier 1’s intellectual property, data and other assets related to its e-commerce business. 

They bought Pier 1’s e-commerce business to do what they did with Dress Barn’s e-commerce business. Go IRL to Online.


DressBarn went under in 2019, closing all 650 stores and perhaps because PE and asset-heavy businesses don’t know how to value online businesses, they sold off their online business for pennies to none other than Tai again.

So just like with DressBarn, for Pier 1, they will take all their online presence and retarget users to create an online brand that sells. Now they can compete head to head with the other e-retailers. Pier 1 purportedly did $300MM in online sales. So $31MM for $300MM ain’t a bad deal at face value.

Devil is in the details which the deck was light on, while heavy on the term “proprietary strategy,’ but we can learn a few things.

Here’s the repeatable portion:

  • Do you have businesses in your neighborhood, stores, companies, at smaller scale who do all their business IRL? That have storefronts that are struggling? 

Learn how to find deals like this on a smaller scale in the small business sector. Read Buying an Online Business for $1K.

The answer let me tell you, is yes. Go for a drive around the commercial areas in your neighborhood. Which look to be struggling a bit? Go google them. Do they have an online presence? Do they have inventory you can sell online? Can you create your own website or setup a drop-shipping company for them?

Then can you go to the business and buy their name, online presence, websites etc for pennies on the dollar and take what used to be a great sporting goods store online? Sex it up a bit with better photos, ads, social media and maybe, just maybe, buy yourself one of those overpriced transportation modes? 

Or better yet, find another business and do it again. Check out business closings during the pandemic.

Sorry to say but most Boomers, or small business owners looking to retire, they DO NOT understand the internet and how to leverage it as a business owner. I mean do you see many of them making Tik Tok videos – hell we don’t even do that and we’re in our 30’s. 

This arbitrage opportunity won’t last forever. So ask yourself, how can you jump on it?

Register for the course here OR if you are serious about buying a small business, join our Mastermind.

Yours Unconventionally,

Codie Sanchez & Ryan Snow
Co-founders Unconventional Acquisitions

P.S. -Not sure if business buying right for you? Read the article – Is Business Buying Right for You?

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