Episode 91 – Amazon FBA Businesses; How to Build it to Sell It
All the parents reading this know what it was like when you left your child with someone outside of the immediate family for the very first time.
Equally difficult was being on the other side of that experience.
Taking good care of anyone is much more difficult if you’re trying to do it without having any idea of what makes that person tick.
What do they enjoy, and do well?
What creates difficulties?
According to today’s guest, scaling up recently purchased Amazon private label businesses involves the same process.
On this episode of the Serious Sellers Podcast, Helium 10’s Director of Training and Customer Success, Bradley Sutton speaks with Ken Kubec, the VP of acquisitions for Thrasio, one of the fastest-growing acquirers of Amazon third-party FBA brands.
Ken says that Thrasio, “Acquires and cultivates high quality, category-leading products that people love,” and that (they) operate a wide and ever-expanding portfolio of brands.”
According to Ken, “Chances are, you’ve purchased one of our products.”
He also says that one of the reasons that Thrasio works so closely with the sellers during the transition process, is that “They’re like a nanny taking over for a parent; they don’t know what the baby’s little cries mean.”
Here’s how Ken found himself in the position he’s in now, closely looking at over 300 Amazon private label businesses in the last year alone in order to decide whether to add another business to Thrasio’s growing stable of Amazon companies.
Ken grew up in Cleveland, later attending Colgate University before settling in Boston.
He studied English Literature but jumped into business almost immediately. After a first job as a corporate recruiter, he spent 13 years working in equities and portfolio management.
He says the shorthand for that job description is that he “picks stocks.”
Thrasio itself started when the two founders joined forces and used their experience with direct to consumer brands, high-level search engine optimization, and backgrounds in venture capital to create a company that helps facilitate the exit strategy for many Amazon sellers.
We all know that reaching the top on Amazon isn’t getting any easier.
At the same time, a lot of eCommerce experts advise that building your Amazon business with the idea up-front to sell it, is one of the absolute best ways to make money.
When for a variety of reasons, Amazon sellers feel that they’ve hit the glass ceiling, that’s where Ken says that Thrasio comes in.
Thrasio employs over 125 people around the globe doing everything from managing the supply chain to creative design and product development.
What are they looking for, exactly?
Ken says that it comes down to what he refers to as, “R cubed; reviews, rating and rank.”
Because no two Amazon private label businesses are the same, Ken says that, Thrasio is very “flexible” in the way that they structure the purchase process.
Want to know what your Amazon business is worth?
Just ask Ken.
Listen for more on how to take that next step in your eCommerce journey.
In episode 91 of the Serious Sellers Podcast, Bradley and Ken discuss:
- 01:06 – Ken’s Origin Story
- 02:30 – Over 25 Private Label Amazon Businesses Purchased in the Last Year
- 04:25 – It’s Getting Harder to Reach the Top on Amazon
- 05:42 – Buying the Amazon Beach-Front Real Estate
- 06:57 – R Cubed – Reviews, Ratings and Rank
- 09:45 – What Kind of Documentation Do Sellers Need?
- 12:05 – Starting with a Seller’s Brand, then Adding Value and Solving Problems
- 14:08 – What’s My Amazon Business Worth?
- 16:05 – Let’s Do the Math
- 20:20 – Then Thrasio Goes About Their Due Diligence
- 23:24 – Can this Model be Duplicated on a Smaller Scale by the Brand Owners?
- 27:17 – The Next Generation of Consumer Product Good Companies
- 27:50 – What are Thrasio’s Company Goals?
- 29:12 – Ken’s 30 – Second Tip
- 30:00 – How to Reach Out to Ken and Thrasio
Enjoy this episode? Be sure to check out our previous episodes for even more content to propel you to Amazon FBA Seller success! And don’t forget to “Like” our Facebook page and subscribe to the podcast on iTunes, Google Play or wherever you listen to our podcast.
Want to absolutely start crushing it on Amazon? Here are few carefully curated resources to get you started:
- Freedom Ticket: Taught by Amazon thought leader Kevin King, get A-Z Amazon strategies and techniques for establishing and solidifying your business.
- Ultimate Resource Guide: Discover the best tools and services to help you dominate on Amazon.
- Helium 10: 20+ software tools to boost your entire sales pipeline from product research to customer communication and Amazon refund automation. Make running a successful Amazon business easier with better data and insights. See what our customers have to say.
- Helium 10 Chrome Extension: Verify your Amazon product idea and validate how lucrative it can be with over a dozen data metrics and profitability estimation.
- SellerTradmarks.com: Trademarks are vital for protecting your Amazon brand from hijackers, and sellertrademarks.com provides a streamlined process for helping you get one.
Bradley Sutton: What do you get when you combine the skills of stock market wizardry, SEO optimization and a background in venture capital? You get a company that’s purchased over 25 Amazon FBA businesses in the last year alone. Say what?
Bradley Sutton: How’s it going, everybody? Welcome to another episode of the Serious Sellers Podcast by Helium 10. I’m your host, Bradley Sutton, and this is the show that’s a completely BS-free, unscripted and unrehearsed organic conversation about serious strategies for serious sellers in any level in the eCommerce world, and today, all the way from Boston, my guest is us, I was about to say, Kevin. I have so many Kevins on this show. It’s Ken. Ken, how’s it going?
Ken Kubec: Great. How are you doing?
Bradley Sutton: Pretty good. Now before we get started into the very interesting topic that you’re going to be talking to us about today, I always like getting the origin story of who I talked to. After 85 episodes, I’ve never had two people with even a remotely close kind of origin story. Real quick, where did you grow up? I believe you told me it wasn’t in Boston, but you grew up in Cleveland, right?
Ken Kubec: Yup, absolutely. Cleveland, Ohio. Born and raised. And then, I went to college in upstate New York Colgate University. And after I graduated, I moved to Boston in 2002 and have been in Boston ever since.
Bradley Sutton: Okay. Now what was your major in college?
Ken Kubec: Actually Colgate’s a liberal arts school, and I majored in English literature.
Bradley Sutton: If you were going to say, it was in dental hygiene.
Ken Kubec: Yeah.
Bradley Sutton: I’m sure you get that all the time.
Ken Kubec: English literature and which actually led to a career in investment management which was not anywhere related to what I majored in. Pretty funny.
Bradley Sutton: I mean immediately after university, your first major job was already in that or did you have a transition phase where you gave the English?
Ken Kubec: Yeah, no, I did not. I actually got a job as a corporate recruiter as my first job out of undergrad. And then, after about a year of doing that, I transitioned over to investment management. And for the next 13 years, I was equities analyst and portfolio manager investing in small-cap technology stocks.
Bradley Sutton: That’s all above my head. You just sounded like you’re speaking “Klingon” there for a second. That’s all right. Well, that’s why we’re here. You’re supposed to teach me about this stuff.
Ken Kubec: I pick stocks.
Bradley Sutton: Okay, there we go. That’s good. I get that. All right. Now, let’s get people excited. Let’s throw a crazy stat out there. In the last year, how many Amazon businesses have you guys purchased?
Ken Kubec: Over 25.
Bradley Sutton: Over 25 Amazon businesses. All right.
Ken Kubec: Yup.
Bradley Sutton: That’s what we’re going to be talking about today, but well, let’s take a few steps back. Now, is this a new company that started with this in mind? Is this an existing company that would do other kinds of investments? Like, “Hey, let’s branch to Amazon,” or how did this start?
Ken Kubec: Yeah. Great question. Our co-founders Josh Silberstein and Carlos Cashman, a couple of years ago, had the idea of rolling up direct-to-consumer brands and leveraging SEO. You know, Josh has a background in venture capital where he worked with numerous consumer brands on consumer funds investing hundreds of million dollars in consumer companies. Carlos with numerous startups and exits. His most recent was actually a Facebook ad agency. They had crossed paths prior to the Thras.io and wanted to team up and start a business together. They initially went down the direct-to-consumer route and then, once they actually got exposure to Amazon and in particular the FBA model, they pivoted and over, I think it was, about 18 months ago, made their first acquisition of an Amazon FBA business. We haven’t looked back ever since.
Bradley Sutton: Okay. Now, in the beginning, I mean obviously I’m sure the reason why you guys started looking into Amazon is because you can see the crazy growth and the potential, and the business model itself is great for this kind of thing. Was it ever even on the table like, “Hey, let’s build a team and let’s just have them churning out brand new businesses.” Or from day one, you guys were like, “What? We don’t want to do all that. We’re just going to go look for people who are already established and purchase.”
Ken Kubec: Yeah. It’s morphed into actually reverse engineering as it stands today. But initially, it was, as you know, when all the sellers know it’s getting harder to get reviews to build a leadership position in a market. The landscape has changed from 2015, 2016 to today in terms of the cost and effectiveness of launching new products on Amazon. And so the initial thesis was, “Well, there’s a void in the market in terms of capital providers to Amazon sellers in terms of an exit,” right? And what we found in our early conversations with sellers is that they have the toolkit and capital to get them to the $3, $4, $5 million of revenue. But once they hit that, they hit a gap class ceiling. And they’re oftentimes leveraging up their credit cards and taking out loans, or maybe they’re taking out a second mortgage on their home to keep the inventory flowing. And at the end of the day, they were putting the personal balance sheet to extreme leverage and risk. And so what that led to was an opportunity for Thras.io to kind of fill a void in the marketplace. And then, by buying that kind of what we call “beachfront real estate on Amazon” and then subsequently drafting off of that brand equity that’s already been built and launching new products.
Bradley Sutton: Okay. Then you do have like an Amazon team, so you’re purchasing these, you guys take over full operations and then you have a team that is managing these existing listings and trying to launch new products on the same brand, etc.?
Ken Kubec: Yup. Yeah. We’ve built up a global team. We have over 125 people globally in the company. And we have the company centered around these kinds of centers of operations. We have a supply chain, operations, finance, marketing and advertising and creative and product development.
Bradley Sutton: Okay, cool. Now, what’s the criteria? What are you guys looking for? I mean there’s billions of Amazon accounts out there, and not every single one is a prospector that meets your criteria, but what are your set criteria of what makes you consider purchasing a storefront or not?
Ken Kubec: Yeah, so we’re actually very broad and in what we look for and look at, and I probably looked at over 300 companies over the past year. And what we really look for is first and foremost, I call it R Cubed. it’s reviews, rating, and rank. Do they have reviews that should establish them as a leadership position? Just from a social proof standpoint in the category. Do they have their rating, the product quality to back up and sustain their position and then rank: are they ranking organically on high keyword volume? And so when you have that trifecta, then we move down to the category. And when it’s on a category basis, we love simple everyday hard-good objects. We haven’t done anything I would say in the supplement space or fruit in grocery. We haven’t done anything I would say trendy apparel or something with high-technology obsolescence risk. But other than that, we look across the entire range of categories.
Bradley Sutton: Okay, cool. Now, do you have like a minimum account that needs to be generated in sales or a minimum profit margin, et cetera?
Ken Kubec: Yeah, so in general, we look probably I would say one to 30 million in revenue. It’s pretty wide. And a lot of that will have to do with SKU concentration and ASIN concentration. For us, we’re a little bit of an anomaly from a buyer standpoint and that we embrace the hero. A son that’s doing 3 million a year in revenue. Because if you think about it, we’re diversifying that risk across our entire product portfolio side,
Bradley Sutton: Okay. Is this only private label accounts that you’re doing or somebody has some amazing wholesale connections. Do you consider purchasing those?
Ken Kubec: No, just private label.
Bradley Sutton: Okay.
Ken Kubec: Yeah, private label. Trademark brand registry.
Bradley Sutton: Of those 25 accounts you’ve purchased, like at the time of purchase not now, but at the time of purchase, if you take the of purchase for every single one of those 25, roughly, what’s the total sales that yearly that those accounts all put together? We’d be doing, I’m assuming, it’s going to be at least since the floor is a million, we’re talking to at least 25 million of revenue total, but it’s obviously a much bigger number than that I would assume.
Ken Kubec: Yup. We’ll be at the end of this year, we’ll be 100 million in revenue.
Bradley Sutton: Wow. That’s awesome. We talk about that yes, you do look at profit margins. Now a lot of Amazon sellers out there like, I would hope to say once they’re getting to that seven-figure range that they do have a little bit more sophisticated financial statements and things like that. But a lot of Amazon sellers, they don’t have that background. They started off as a hobby and they just kind of make it big. They might not have, Hey, a P and L and all this stuff. What would somebody have to have prepared already know if they were to come to you? Like what kind of financial documentation are you looking for?
Ken Kubec: Yeah. I think one of the things is that we’re building a company. This is all we focus on, right? With that comes scripting and modeling and things that we can do to help the sellers achieve an exit. And so to be honest with you, it’s everything’s in seller central. If somebody doesn’t have a P and L now, we’re happy to sign a nondisclosure and we can build a monthly accrual-based P and L within a half an hour for a seller, we have that all automated at this point. And then all we really need for them is to reconcile the cost of goods sold. And once we have that, we can build a P and L that we feel comfortable with enough to make an offer on the business. You don’t have to hire a CPA and tax returns and have it all buttoned up and spend $15,000 just getting your books clean.
Bradley Sutton: Okay.
Ken Kubec: That’s one of them. That’s one of the beauties of Amazon: everybody has the same canonical source of data and seller central.
Bradley Sutton: Are you only looking at companies selling primarily in the United States? Or like, have you purchased anything where their main sales are coming from Europe, for example?
Ken Kubec: Yup. We’ve purchased European sellers that are in the marketplaces. We’ve purchased a handful of UK sellers. Which is actually an equity purchase versus an asset purchase. Yeah. Were geography agnostic?
Bradley Sutton: All right. Cool. Any in Japan or any of the other stranger marketplaces other than European and US?
Ken Kubec: We haven’t yet. But I foresee 2020 that we will, I’m actually talking with a seller in Japan right now.
Bradley Sutton: Okay, cool. Now, what’s your strategy for growing these? I mean, obviously you pick an account and it meets the certain metrics and it’s got the great reviews. Are you only considering like ones that have kind of built a brand that you can actually build upon or just the fact that somebody has a really solid account with just various things, it allows you to just bring in outside brands? Like are you developing any just brand new brands? Just taking advantage of the great account status that they have or every single thing for expansion is based on whatever the original brand is.
Ken Kubec: Yeah, so we start with the original brand. Not, necessarily the seller central account or the seller rating. We’re building up our own, so we really start with the products and the listings. And then from there, there’s a myriad of ways in which we can bring resources to the table to enhance, whether it be a search optimization, marketing may be a seller’s underspending on PPC by 10 to 15%. I’m creative. Maybe they haven’t had the capital or time to invest in reshooting photos and adding enhanced brand content or supply chain and logistics. Yeah, maybe they’re not the best negotiators with their suppliers. They haven’t been to China and walk the factory floors. Legal we have a full legal team, chief counsel and five in house attorneys to handle everything from IP to trademark to listing compliance to product packaging compliance. There’s a whole host of resources that we bring to a brand that should allow for on cost efficiencies but also a revenue growth.
Bradley Sutton: Okay. Another quick question. I’m just doing things as they come to my head
Ken Kubec: Yeah.
Bradley Sutton: Here because usually, I find that since this, I know nothing about this, a lot of the questions I have is probably what our listeners have. But let’s say there’s already a million-dollar seller out there or somebody who’s just starting or halfway there and they just want to have an idea of like, Hey, if I do decide to sell my business, like what it’s worth. Now obviously there’s going to be tons of factors, like maybe the amount of inventory they have, their profitability et cetera. But as a general rule of thumb, is there any kind of formula where it’s like, Hey, if you’re making X, then we multiply or divided by Y. And then that’s kind of like what you could look at getting in a deal like this.
Ken Kubec: Yeah. Typically the market values Amazon businesses based on their trailing 12 months profit
Bradley Sutton: Okay.
Ken Kubec: That’s commonly defined as seller’s discretionary earnings. What your net profit and then you would add back to that the owner’s expenses. If, let’s say they drew a salary of $100,000 a year to pay themselves, so you would add that back to the net profit to calculate your seller’s discretionary earnings. And then once you have an agreed-upon seller’s discretionary earning number, then you would apply a multiple to that. And that is really, it’s art and science. It’s not, we don’t sit back here and have this huge computer sitting in a room that calculates the value of the business. It’s really looking at growth trends, looking at product launches, looking at the growth that the product has. The product score, the opportunity, the competitive landscape just like if you were going to go out and buy a business, you’d look at all those things, right?
Bradley Sutton: Yeah.
Ken Kubec: We factor all that in and then we come to what we think is a fair evaluation of the business. We have a pretty good feel of what these businesses sell should sell for and what’s fair market value. And that being said, the range it typically upfront, I’m on an upfront multiple is two to three X and then there are a typically stability payments or performance-based payments on the back end of that as well to get people to a three-four X. I would say the range is probably all in is two to four X.
Bradley Sutton: Two to four X of what?
Ken Kubec: The sellers trailing 12 months seller’s discretionary earnings.
Bradley Sutton: Okay. Makes sense. That’s interesting. Let’s just for those who are driving and then they can’t put too much brainpower to this about calculating and stuff. I don’t want people getting into accidents out there. Let’s, walk us through like a typical let’s say a business or an Amazon store is making, or not making but selling a million gross revenue, $1 million a year. Their profit margins.
Ken Kubec: 20%
Bradley Sutton: 20% well, walk us through how the rest of that’s about as far as I can go.
Ken Kubec: If their net profit is 20% and let’s just say they’re paying themselves out of that $50,000 a year, that goes into calculating that 20 $200,000 net income, net profit and that 50,000 back. Now you’re at a trailing 12 months, $250,000 we would take that number and then you would apply a multiple to that. Let’s say on the low end that business could sell for $500,000 right? On the high end, you’re talking a million dollars.
Bradley Sutton: Okay. All right, cool. That’s it. That’s great. A rule of thumb to go by. Are there any circumstances where like maybe, I don’t know if the owner really wants to or if it’s just a really tricky kind of business where you actually have an ongoing arrangement where you bring the owner on as like an employee for six months or something in a transition period or how does that even, how does that transition period even work?
Ken Kubec: Yeah, so we’re very flexible. I think that’s one of our value propositions as a buyer. Speed and flexibility. In terms of speed, we’re very well-capitalized. We have cash on hand to be closed within 30 to 45 days. In that event, if the seller has launched another product or they want to reinvest the capital in the real estate or they just don’t want it, they want to be done with Amazon, they have that option. It’s maybe it’s a 30 day period where Hey, you need to answer the phone when a brand manager who’s responsible for the brand internally has a question or the supplier goes dark with our supply chain team,
Bradley Sutton: Yeah.
Ken Kubec: or there’s going to be these questions that come up. Right? And I always say that we’re like a nanny. Taking over the baby from a parent, we don’t know what the little initial cries mean
Bradley Sutton: Yeah.
Ken Kubec: That a parent knows. Right. To the extent that the seller can help us out with that, That’s kinda great. That’s great. And the minimum we ask, for now, the maximum would be a scenario where an owner has 10 products that they’re just about ready to launch and they feel very confident in the six future success of those products and they want to participate in the upside of those products. Under that scenario we would say, okay, let’s buy your business as is and let’s sign a consulting agreement with you whereby over the next year you help launch these products and you can have a profit share and yeah, the success of those products.
Bradley Sutton: Okay.
Ken Kubec: It’s really all over. There’s no cookie-cutter formula that we subscribe to because everybody has a different vision of how they want the transition to play out.
Bradley Sutton: Okay, cool. What are some other things that I’m kind a, I mean, I’ve had a lot of questions here, but I’m kind of running out here, but I know this just like so much. Like what is typical, what I want to do now is w when you guys start talking to businesses like I’m sure the owners have tons of questions. In your experience, what are some of those common questions that maybe I had not asked that you guys get from interested parties? And like I said, I’m sure our listeners would probably have those same questions.
Ken Kubec: Yeah, I think the biggest thing is the due diligence process. Right? In the overall process, I talked to every single seller that inquires with. I do all the phone calls, I work hand in hand with Josh, our CEO on putting together all offers for all the businesses we acquire. Once we put an offer forward that’s agreed upon, we sign what’s called a letter of intent. It’s a non-binding contract, but it just says, Hey, assuming that the profit is what we both agreed upon and what’s been reflected us as buyers, this is what we’re willing to pay for the business. This is the structure of the payments. Once that happens, the due diligence period kicks off in earnest. I obviously do a lot of diligence upfront on the competitive market, but it’s all publicly available information, right?
Bradley Sutton: Yeah.
Ken Kubec: It’s using Helium 10, and doing research on the market. Once it goes to due diligence, it’s access to seller central is a validation of the cost of goods sold, any outside advertising, et cetera. There’s usually a series of calls with the internal stakeholders at threat CEO from all the different departments. And then over probably the next three weeks, once we get comfortable around the numbers and the operations, we would turn over what’s called the final asset purchase agreement. The final draft of that, and then we encourage sellers to enlist outside counsel just to review the document and make sure they’re comfortable with what the outline expectation is. And once that’s signed that’s typically within 30 days. Then we begin the account migration period.
Ken Kubec: We have an awesome team internally that’s done over 25 of these. It’s a pretty seamless process from a seller standpoint and that can take anywhere from seven to 15 days really based on, Amazon’s response to the query is et cetera. And then once that’s done at typical escrows released and the sellers are paid. I think there’s a misconception in the marketplace in general during M and transactions that once people get into diligence period that the buyer often tries a tech talk the seller down in price and that’s not our aim at all. We close over 90% of deals that we put under a letter of intent. We’re not just out signing your letters, intend to get exclusivity and decide whether or not we want to buy the company.
Bradley Sutton: It’s not going to be like just 200,000 people sign up for the Tesla cyber truck, but only 5,000 actually ended up buying,
Ken Kubec: No,
Bradley Sutton: Okay.
Ken Kubec: When we signed the letter of intent, our intent that is to acquire the company.
Bradley Sutton: You said you’ve bought 25 so far have every single one other than maybe the most recent ones, have you been able to increase the sales or like on 90% of them, 50% of them or what’s your Jess, I mean this has nothing to do with purchasing, but
Ken Kubec: Right.
Bradley Sutton: It’s going to lead to another question, depending on your answer.
Ken Kubec: What I would say is kind of what we disclose is that our weighted average growth, so based on a profit dollar that we’ve acquired has grown on average from 40 to 65% on a rolling, trailing 12 months basis.
Bradley Sutton: Okay. Well, I had a feeling it was going to be something crazy like that. That, thus my next question, what are some of your overall strategies? I mean, because somebody listening to this might not have it might not be one of their goals to sell their business, but maybe they do have a whatever size business they want to increase it. For you guys, what you’re doing something on a big scale that everybody wants to do. They don’t have 25 businesses, they got one. But whatever strategy you’re using obviously is working. Like, what are you guys doing once you take over these businesses that allow you to scale like that,
Ken Kubec: There are first-level improvements. That would be again, supply looking very intently on the supply chain and supply chain costs. Secondarily, it would be the advertising campaigns, are they optimizing for a cause? Is there an opportunity to invest more dollars in advertising to hit the target? A cost for a given product? Keep staying in stock, right? I mean I’ve seen so many businesses that yeah, drop and BSR because they go out of stock for a month and there’s still crawling out. Right? It’s kind of it’s one of the things that we do day one is making sure we’re adequately stocked across the board. And then when you moved down to second level improvements and that’s things that are a little bit longer data. But we have an awesome team internally that moves quickly and is able to enact a lot of improvements. And that would be a creative refresh. I mean, I can’t tell you how many times that we’ve been able to increase conversion rates 15, 20, 30% on listings by refreshing, creative. And then off Amazon traffic sources influencers, YouTube outside Amazon advertising avenues investing in those. There’s just a bunch of different growth avenues to really optimize the businesses.
Bradley Sutton: Okay, cool. Well, one of the things you mentioned just had me thinking of something. Does it increase the value of what somebody could get if they have been building an offline audience if they have like established social media with X number of followers or is just your main metric, just Amazon account itself and those kinds of other things are just kinds of throw-in
Ken Kubec: Yeah, so I would say if they can point to the value that those off Amazon assets have helped create on Amazon, that’s definitely something that we look at and we would put a value on. If they say, Hey we have 25,000 numbers that we can text and we’ve launched products on this and this is the ramp of the products based on and kind of call to action that we’ve implemented. We would definitely look at that and put a value on it. The question I always get in concert with that is, Hey, if I have 5% of that off Amazon revenue, what’s that worth? I tell everybody, It’s if Amazon shuts you down, that 5% isn’t going to save your business. Right?
Bradley Sutton: Yeah.
Ken Kubec: And it’s just a different business model, direct to consumer, customer acquisition costs are all over the board. Lifetime value. It is just different. I would encourage people now if you get 10, 15, 20% it starts to add a little bit more value to the business because there’s going to be a knock on a flywheel effect within Amazon of having that offline presence and people, buying and finding you on direct and then repurchasing on Amazon et.
Bradley Sutton: Okay. As far as the way you guys, or even if it’s in the, you’re not doing it now. If it’s something in the future, like the way you guys scale, is it only within the marketplace where it’s already selling or like let’s say you buy the US only account, like are you going to start, Hey, I’m going to, we’re going to go ahead and expand to Europe or vice versa. Do you have short or long-term girls? Like, Hey, they’re on Amazon. Yes, we’ll start on Walmart or we’ll try and get wholesaler agreements. We’ll try and get brick and mortar. Or are you guys just strictly just building exactly in the marketplace where they were established?
Ken Kubec: Oh, that’s a great question. What would you view ourselves as? Kind of we’re trying to build the next generation consumer product, good company. With that, it’s not just Amazon, right? Primarily today it is. But if we look out over the next two to three years, we are definitely going to focus on other channel growth outside of Amazon.
Bradley Sutton: Okay cool.
Ken Kubec: Right. We’re already doing it today.
Bradley Sutton: What are your guys’ goals, I mean, did you hit the goal that you wanted to in 2019 and what’s your goal for 2020?
Ken Kubec: Yeah, great question. Yeah, we did. We’re tracking towards the goal that we established when this was a five-person office over a year ago. It was pretty awesome too. Be a part of that and seeing the growth of the company. But we think we’re just getting started. We’ve done a lot of heavy lifting this year in terms of infrastructure internally to really accelerate the acquisition process. I think as we turn the calendar year in 2020, our expectation is to double what we did this year and continue that. And in 2021
Bradley Sutton: Sweet. Now what I want to do right now is what the section of our program we call the, that stands for TST, which is a 30-second tip. Basically, what is a high-value kind of tip that you can give our listeners that it has to be 30 seconds or less? It could be something about preparing a business to eventually be sold or somebody just, it could be just your scaling strategy. It could be how to be a Cleveland fan in Boston. I mean, first all, I mean, like, how not to get killed at a Boston pub when we’re wanting to watch our Cavaliers game. I mean,
Ken Kubec: Yeah.
Bradley Sutton: Whatever the case is, 30 seconds or less. Let’s hear what your tip is.
Bradley Sutton: You can take your time.
Ken Kubec: Yeah, so my tip is when you are ready to sell your business is being honest and upfront. There’s nothing, there’s no bigger deal-killer than dishonesty, right? We’re buying a business, but we’re also buying the trust of the seller and that they built a great business that they know sad to part with, but also happy to part with at the same time. We know what it takes, know the perils of selling on Amazon and how stressful it can be. And so it’s going to get the truth going to come out eventually. And that’s one of the biggest things that I would recommend people do. We’re not we don’t have stars in our eyes when we look at businesses.
Bradley Sutton: Okay. All right, cool. That’s a great tip. Now, Ken, if people want to ask you more questions or possibly even start the conversations about seeing if you’d be interested in their Amazon account, how can they find you on the interwebs?
Ken Kubec: Yeah. LinkedIn, Facebook send me an email, Ken at THRAS, T H R a S. dot. IO. You can go also go to our website. There’s a contact us form that comes directly to me and I respond directly to each one.
Bradley Sutton: Well, What? Just the direct website,
Ken Kubec: It’s www dot THRAS—T H R A S—dot I O and just kind of hit contact us and it’ll come to me and I’ll contact you.
Bradley Sutton: All right, Ken, thank you very much for coming on the program. We haven’t had anybody talk about that and that’s something I think that’s of interest in many sellers because some people start into Amazon because they just want to know their own, income, but then that they don’t have an exit strategy and you guys are kind of providing that. I think it’s something that a lot of Amazon sellers should look into. Thanks for coming on and maybe in a year, I love to around this at this time of the year, bring you back on and let’s see how, how you guys crush your 2020 goals.
Ken Kubec: Yeah, absolutely. Thanks for having me on Bradley.
Bradley Sutton: All right, thanks a lot. Quick note guys, don’t forget that regardless where you are listening to this podcast, whether it’s on your iPhone or on Stitcher, on Spotify, that you hit the subscribe button so that you can be notified every time we drop a new episode.