Keeping it in the Family: How three brothers sold their online business PitchingMachinesNow.com for $149,000 on Flippa
By Andrew Knibbe
Boise-based Dave Hermansen, with brothers Kevin and Mike, didn’t plan to sell their online business PitchingMachinesNow.com when they built it. These brothers have the process of building, launching, and monetizing ecommerce sites “down to an art”—they’ve created more than 50 stores over the last few years.
Yet the promise of a new venture convinced the brothers to sell the site. Just 24 hours later, it was listed on Flippa.
And within days, the site had sold for the Buy It Now price of $149,000.
“We really only use Flippa for selling websites at this point. It’s the highest exposure you can get for a website auction online,” Dave explains, and indeed, that expectation paid off.
“We set our BIN at the maximum amount we thought we could possibly get,” he reveals. Three potential buyers offered that price.
Among them was aspiring entrepreneur Matt Caldwell, who showed the listing to his dad, Randall.
“Matt will be attending college in the Fall of 2012 and is planning to major in Entrepreneurship,” Randall explains.
“The plan was to loan Matt the money to buy the business and use the profits to pay back the loan, with interest, and pay for college.” It’s an experience Randall hopes will give his son a real-world education in “sales, internet marketing, customer service, order processing, inventory mgmt, accounting and more.”
Randall used his 20-year career in sales and commercial real estate investment to guide Matt in finding a good opportunity.
“Matt searched multiple market places … and sifted through hundreds of listings over a year,” Randall says. “The goal was to find a business that had a track record, and cash flow over $3,000 per month (to cover the cost of the loan and college).”
The pair’s other requirements—which included price-to-profit ratios, margins, search rank and scalability—were also covered in the comprehensive PitchingNachinesNow.com listing.
Most importantly, says Randall, the site “was a good fit—something that he could get excited about selling.”
Both families found each other credible—a big factor in the smoothness of the sale, which took just one day, from due diligence to the wire transfer of payment.
But that personal touch mattered long after the sale was complete.
Says Dave, “They’ve picked my brain a lot and I’ve tried to give them good advice on how to grow the online business to maximum potential.” Randall explains that, as well as expanding the product mix to include additional pitching machines, batting cages, and mounds, the Caldwells are thinking outside the box to build the business.
“PitchingMachinesNow recently partnered with Cal Ripken Amateur Baseball,” says Randall, “and has established a retail presence … in Aberdeen, MD. We’re also in discussion with some of our suppliers about becoming an East Coast distributor for their particular products.”
The sale of their online business allowed Dave and his brothers to focus on the launch of StoreCoach.com, a community dedicated to helping ecommerce site owners to build and run profitable ecommerce stores, with free training, exclusive tools, forums, and an SEO center.
And not surprisingly, Randall and Matt are Store Coach members.
It looks like this family alliance is set to last for some time.