As part of our ongoing series of reviewing online brokerages and marketplaces, we chatted with Greg Elfrink, who serves as the Director of Marketing at Empire Flippers and asked him about all about Empire Flippers, including their origin story, the businesses they sell, their vetting process, and more. Here’s the breakdown:
What’s the story with Empire Flippers? How’d you guys get started?
Greg: We got our start as a brokerage selling our own businesses that we created. At the time, no one was really blogging about the subject of building online businesses with the ultimate goal of selling so we journaled our entire journey. Over time, this made a big audience of people who loved what we were doing and eventually started asking us if we could sell their business on their behalf since we had built an audience of buyers through our blogging. Eventually, we stopped building our own digital assets to focus purely on being an M&A brokerage and since have become the largest curated marketplace in the world for buying and selling profitable online businesses.
What type of web businesses do you specialize in?
Greg: We really sell a wide variety of businesses on our marketplace from content sites, eCommerce stores and other lesser known models such as KDP publishing or even apps.
The business models we are the #1 industry leader in are:
- Content businesses such as affiliate or display ad sites: We sell well over a hundred of these every year.
- Amazon FBA: We sell far more than anyone else here and have been doing it the longest, starting way back in 2016.
- KDP Publishing: It is rare to see anyone selling this model in our space but we’ve sold several 7-figure KDP based businesses
As far as price ranges go, we offer a very approachable marketplace for entrepreneurs at all different levels. There are businesses valued at $40 — 60k that often fly off the shelves with our audience. We’ve also sold many seven-figure and up businesses. We just sold three businesses where each one was valued at $10M+. So far, we’ve made right around 54 millionaires, purely from helping sellers with a successful exit of their business.
The one model that we are starting to expand further into is SaaS. We’ve listed several high six-figure and recently a seven-figure SaaS on the marketplace, but this is still a relatively new business model on our marketplace.
What type of financing options are available to buyers?
Greg: The vast majority of buyers that do any kind of financing is going be seller financing with an earn out component, typically with milestones attached to it. This can actually be a pretty solid advantage for buyers because it helps them mitigate capital risk while also aligning the seller with them on the future success of the business.
There other financing options people have done includes a group of entrepreneurs pooling money together, or an entrepreneur putting together funds with outside investors.
We’ve recently launched Empire Flippers Capital that solves some of these issues. It allows passive investors to fund talented entrepreneurs who will act as operators that will then go and acquire profitable assets from our marketplace. It’s still in its early days but we think this could solve quite a few pain points when it comes to financing for buyers, and a bunch of other interesting solutions to other problems in the M&A space. Our vision for it is to become a marketplace of funds.
What kind of vetting do you guys do for businesses you list?
Greg: Our vetting is quite intense and thorough. To put it in perspective, we reject right around 92% of businesses that get submitted to us. This means our buyers expect very high quality businesses from our marketplace.
The actual vetting process can take anywhere from two to eight weeks, depending on the complexity of the business you’re trying to sell. A quick tip here for sellers is you can often cut this time down dramatically simply by being proactive and communicating with us so we can get through all of our checks in a timely manner.
Anything unique about Empire Flippers that most other online business brokers don’t have?
Greg: There’s a lot we do differently but I’ll mention just two. Firstly, we are not a loose group of brokers operating under an umbrella brand. Each member of Empire Flippers is a true, in-house employee. This has allowed us to take the normal M&A process and divide it up into chunks and create thorough systems at each stage. So, instead of having a broker that does every aspect from the marketing, sales, vetting etc. you have an entire department dedicated to just that one aspect, allowing us to often go deeper and become more nuanced in what we’re able to do for our customers.
The other big thing we do that pretty much no one does is migrations. Migrations is the process of actually handing over the business to the new owner successfully. It is arguably the most important part of the entire process because if this doesn’t go well, there’s a solid chance the actual deal could fall apart. No one else does this in the industry, primarily due to the liability concerns of something going wrong. However, we do it because we want to make sure both our buyers and sellers are as successful as possible. It’s our migrations team that also handles any earn out payments on behalf of the seller so they’re not having to add something else to their plate when they exit their business.
Any cool stats about your Empire Flippers you’d like to share?
Greg: We have tons of cool stuff happening. If you want to see a real-time transparent report of how well our M&A firm is doing, you can always check out our Empire Flippers Scoreboard, which is updated in real-time (including how many millionaires we’ve helped make). One cool stat is that we now have over $4,226,870,049 of verified funds from our buyer network, and in Q2 2021 we added slightly over an extra billion dollars of buyers looking to acquire. Another is that on average, we sell a business within 28 days of it being on the marketplace and that has allowed us to have the shortest exclusivity in the industry at just two months.
If you’d like to see some of the powerful and emotional stories we’ve helped both entrepreneurs and investors make by using our service, our testimonial page is an excellent resource. We try to cover stories at all levels so there’s something for everyone there, regardless of where they’re at in their career.
What’s the best way for buyers or sellers to reach you if they’re interested in learning more?
Greg: Our website is a great place to explore and register an account. You can set up a chat using the messenger system on there or schedule a call. If you’d like to chat with me personally, you can always reach out to me on LinkedIn. I’m always happy to help if I can, whether you decide to use our services or not.
Thanks for taking the time out, Greg. Anything else you’d like to add?
Greg: I think this industry is starting to really go mainstream. This means there is an absolute gargantuan opportunity here for both buyers and sellers. On the seller front, we’ve never seen valuations so high nor the buying frenzy so intense. If you’re looking to make a truly life changing exit, you couldn’t ask for a better time to sell as it is the first seller’s market I’ve ever seen after being in the industry for over half a decade.
On the buyer side, incredibly exciting things are happening as buyers become savvier and start using strategic acquisitions to really scale their businesses. To put in perspective, we’ve seen three of our buyers become unicorn companies reaching that incredible billion dollar status.