Thread by @DruRly

1/ 💰 Trends #0038 — Micro Private Equity

A thread:

• 🔮 3 Predictions

• ☁️ 6 Opportunities

• 🔑 4 Key Lessons

• 😠 5 Haters

2/ 🔍 Problem

Starting a business is risky. And takes time.

You may spend years seeking product-market fit, building systems and still fail.

3/ 💡 Solution

Buying businesses helps you save you time, skip years of costly mistakes, fast-forward to product-market fit and focus on scaling.

4/ 🏁 Micro Private Equity Funds

SureSwift Capital (@SureSwiftCap)
Calm + Capital (@CalmCapital)
Apollo Black (@atomicbev)
LTV SaaS Fund
Concrete Capital (@Nile)

5/ 🏁 Companies

FeedbackPanda (@feedbackpanda)
RemoteLeads (@remoteleads_io)
NoCode.tech
DeployBot (@DeployBotHQ)
Taster’s Club

6/ 🏁 Marketplaces

MicroAcquire (@microacquire)
IndieMaker (@indiemakerco)
Investors Club

7/ 🏁 Brokers

FE International (@FEIntl)
Empire Flippers (@EmpireFlippers)
BuySellEmpire (@buysellempire)

8/ 🔮 Prediction

Third-party tools like Stripe, Google Analytics, Square and Shopify will make it easier to verify metrics.

Buyers will trust by proxy. This makes cursory due diligence easier.

9/ 🔮 Prediction

More marketplaces will integrate with third-party services and improve the buying experience.

MicroAcquire integrates with Stripe. IndieMaker will add integrations.

10/ 🔮 Prediction

Finding and buying alternative assets, like Spotify playlists and social media accounts, will become easier.

Sites like Swapd make this possible.

11/ ☁️ Opportunity

Know your criteria.

Will you buy digital products, B2B SaaS, Micro-SaaS, affiliate sites, FBA businesses, Shopify stores or something else?

12/ ☁️ Opportunity

Know your unique advantage. Build a playbook:

• Raise revenue with conversion rate optimization

• Lower customer acquisition costs by improving SEO

• Lower costs by automating workflows

13/ ☁️ Opportunity

Buy businesses with similar customers and cross-sell to boost LTV and lower customer acquisition costs.

See Awesome Motive in the WordPress space.

14/ ☁️ Opportunity

Build a personal brand for proprietary deal flow.

A few names consistently came up in this thread.

15/ ☁️ Opportunity

Find deals using tools like Growth Ranker, Traffic Opportunities and Product Explorer.

16/ ☁️ Opportunity

Help others find deal flow:

Micro-SaaS: Source deals from several marketplaces.

Digital Product: See Product Explorer.

Paid Newsletter: See Traffic Opportunities and Website Flipping Newsletter (@TheWebsiteFlip).

XaaS: Offer deal-flow-as-a-service

17/ 🔑 Key Lesson

Start small and move up in deal size over time.

18/ 🔑 Key Lesson

Forget 0 to 1. Go from 1 to N. Save time, reduce risk and “buy” product-market fit.

19/ 🔑 Key Lesson

Build an “audience-first fund” for proprietary deal flow.

20/ 🔑 Key Lesson

Assume every business has a price and do cold outreach.

21/ 😠 Haters

“What is micro?”

It’s relative. Let’s say businesses valued under $5 million.

22/ 😠 Haters

“This assumes that I have money.”

Or that you can raise money or get seller-financing. You can reduce some market risk by copying successful businesses. Assuming that there are no strong moats. But execution risk remains.

23/ 😠 Haters

“Small deals have high transaction costs relative to the deal size.”

Prioritize learning over earning at this stage.

24/ 😠 Haters

“It’s against terms of service to sell social media accounts.”

Wrap them in an entity and sell the business. Not the account.

25/ 😠 Haters

“Data provided by sellers can be faked.”

This is a cat-and-mouse game. And may never be solved. Live dashboards from third-parties like Stripe and tools like Phlanx make this easier to spot. Talk to customers and trust your gut.

26/ 📈 Here's the full report

trends.vc/trends-0038-mi…