Capitalizing on the Shift From Bricks to Clicks | Built to Sell Radio

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In 2016, Chad Rubin crafted Skubana, a tool specifically designed to streamline the operation of his e-commerce store across diverse channels. Sensing the software’s potential, Rubin decided to offer Skubana to other online business owners.

The platform rapidly resonated with e-commerce entrepreneurs, accumulating $5 million in annual recurring revenue by 2021. The company’s success drew the interest of prospective buyers, eventually culminating in an irresistible offer from 3PL Central, a premier provider of warehouse management software. In this episode, you’ll learn how to:

• Build your moat in a competitive industry.
• Raise money using a convertible note.
• Attract high-quality investors using Rubin’s innovative method.
• Avoid a hiring mistake that could derail the growth of your company.
• Hire great employees using Rubin’s assessment test.
• Stimulate interest from potential buyers with an intriguing outreach strategy.
• Find meaning in your life after you’ve sold your business.

Check out our full M&A Glossary

Show Notes & Links

Chad’s LinkedIn Profile (Message to get his hiring assessment test)

Official Press Release

Wim Hoff Breathing Exercises

Chad’s New Company

 

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Definitions

 

Letter of Intent (LOI): A letter of intent (LOI) is a document declaring the preliminary commitment of one party to do business with another. The letter outlines the chief terms of a prospective deal. Commonly used in major business transactions, LOIs are similar in content to term sheets. One major difference between the two, though, is that LOIs are presented in letter formats, while term sheets are listicle in nature.

Source: https://bit.ly/3ppDnr3

Earn-out: Earnout or earn-out refers to a pricing structure in mergers and acquisitions where the sellers must “earn” part of the purchase price based on the performance of the business following the acquisition.

Source: https://en.wikipedia.org/wiki/Earnout

Due-Diligence: Due diligence is an investigation, audit, or review performed to confirm facts or details of a matter under consideration. In the financial world, due diligence requires an examination of financial records before entering into a proposed transaction with another party.

Source: https://bit.ly/3yYDfo5

Preferred Preference: Preferred Preference means that amount equal to the sum of the Preferred Preference Per Share for all shares of Company Preferred Stock (including any rights convertible into, or exercisable or exchangeable for, shares of Company Preferred Stock on an as-converted, exercised, or exchanged basis) issued and outstanding immediately prior to the Effective Time, rounded to the nearest one hundredth (0.01) (with amounts 0.005 and above rounded up).

Source: https://bit.ly/3RSTtGH

Note: A note is a debt security obligating repayment of a loan, at a predetermined interest rate, within a defined time frame. Notes are similar to bonds but typically have an earlier maturity date than other debt securities, such as bonds.

Source: https://bit.ly/3Ziaiyy

Vesting: A vesting schedule is an incentive program for employees that gives them benefits, usually stock options, when they have contractually fulfilled a specified term of employment with the company. The benefits can also be other assets, such as retirement funds. Vesting is a way for employers to keep top-performing employees at the company.

Source: https://bit.ly/44eCAf9

Convertible Note: A convertible note is a way for seed investors to invest in a startup that isn’t ready for valuation. They start as short-term debt and are converted into equity in the issuing company. Investors loan money to the startup and are repaid with equity in the company rather than principal and interest. The convertible note is automatically changed into equity once a specific milestone has been reached, usually when the company is officially valued for later investments.

Source: http://bit.ly/3XZo8EO

Put Option: A put option gives you the right, but not the obligation, to sell a stock at a specific price (known as the strike price) by a specific time – at the option’s expiration. For this right, the put buyer pays the seller a sum of money called a premium. Unlike stocks, which can exist indefinitely, an option ends at expiration and then is settled, with some value remaining or with the option expiring completely worthless.

Source: http://bit.ly/3ItK5Fh

 

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About Our Guest

Chad Rubin

Chad Rubin has been a key player in the e-commerce space since 2008. He uncovered a significant problem plaguing Amazon brands that’s gradually eroding their profits.

To understand his impact, let’s trace back to the companies he has built over the years in the e-commerce ecosystem:

•  Skubana (Acquired)
• The Prosper Show (Acquired)
• Sellers Choice (Acquired)
• Think Crucial (Cash Flowing)
• Deep & Saasy (Transforming)

 

Rubin’s work isn’t just confined to creating solution-oriented companies. He is also a well-respected speaker at webinars and conferences worldwide, sharing his expertise on e-commerce, Amazon, and SAAS.

Adding another feather to his cap, Rubin is the author of an Amazon bestseller, ‘Cheaper, Easier, Direct.’