Last year we sold one of our big brands to an “Amazon aggregator”.

This is the story of 3 shady things they tried, how we countered, and how I still lost $500,000.

If you’re thinking of selling to an aggregator, read on to learn how to avoid getting screwed. Predatory practice #1 - “we get AR but you keep AP”

They tried to slip in language saying all receivables transferred with the deal - INCLUDING the balance in our Amazon seller account.

They still wanted us to pay all payables.

We struck it, they caved (bc it's totally unfair)

We just sold one of our big brands to an “Amazon aggregator”.

This is the story of 3 shady things they tried, how we countered, and how I still lost $500,000.

If you’re thinking of selling to an aggregator, read on to avoid getting screwed. Predatory practice #1 - “we get AR but you keep AP”

They tried to slip in language saying all receivables transferred with the deal - INCLUDING the balance in our Amazon seller account.

They still wanted us to pay all payables.

We struck it, they caved (bc it's totally unfair)

You can get better-than-public pricing at Uline - here's how to do it.

This thread will save you 10-20% on cardboard boxes and anything else you get from Uline.

Bonus tip at the end on getting max volume pricing on everything, even if you don't hit the tier qty.

Let's go ⬇️ Go to your "Order History", and write down the item numbers (S-XXXXX) of anything you order in large quantities, and the largest quantity you'd be willing to order that item in, so you can get the best price.

Here's mine as an example.

Now take that list to the next step...

We spend over $100,000 per year to be sales tax compliant @ElementsBrands. That’s software, filing fees, and labor.

This screenshot is what proper sales tax compliance looks like for ONE order.

You must file a separate return for each jurisdiction and every state…quarterly. @ElementsBrands It is downright small business hostile. The resources required for compliance are too much for small businesses to bear. The only option is non-compliance and pray not to get caught.

Everyone talks about regressive taxes, but no one ever mentions regressive compliance burdens.

Entrepreneurs, this is an intervention.

🚫 STOP taking merchant cash advance loans from Wayflyer, 8fig, ClearCo, Shopify Capital, and more.

🏦 The entire business model of these lenders is exploiting the fact that you can't do interest rate math.

That ends today. Read on ⬇️ Make sure you stick around until the end - I'll share a free Google Sheets calculator, and some much more affordable ways to finance the growth of your business.

OK, let's dive in 🧑‍🎓

I've borrowed nearly $15,000,000 since 2012.

Debt has been cheap and plentiful for 10 years. Borrowing as much as possible was the move.

But times are changing.

It's time to reduce your company's reliance on debt.

Here's how you should think about debt in 2022...

🧵👇 For the past ~10 years, interest rates have been effectively zero. That meant it was almost free to borrow money!

This made borrowing for acquisitions, expansion, or inventory "once-in-a-lifetime" cheap, so the logical thing to do was hit the gas.

Did you know Uline will give you better-than-public pricing? All you need to do is ask.

A thread on saving 10-20% on cardboard boxes and anything else you get at Uline.

Bonus tip at the end on getting max volume pricing on everything, even if you don't hit the tier qty.

🧵... Go to your "Order History", and write down the item numbers (S-XXXXX) of anything you order in large quantities, and the largest quantity you'd be willing to order that item in, so you can get the best price.

Here's mine as an example.

Now take that list to the next step...

This is my favorite cartoon of all time.

Today I learned it has a name: Emotive Conjugation.
Folks use different phrasing depending on their perspective.

"I am firm, you are obstinate, he is a pig-headed fool."

Let me teach you to recognize it in the wild... 1/13 🧵 Let's warm up with a few more:

"My child has strong opinions, your child is unruly, his child is a brat."

"I am detail oriented, you are in the weeds, he is a nitpicker."

"I am thorough, you are wordy, they are a long-winded bore."

Sound like anything you read or watch?

2/13

This is the story of how I paid for my wedding by building a micro-SaaS product.

I tested it on my own wedding guests, found several hundred brides as customers, then sold it on @microacquire.

Here's how it happened 🧵🔽 A week before the wedding, my wife asked if there was a way to pre-schedule text messages to our guests.

"Shuttles leaving in 10 minutes"
"After party at this bar"
"Thank you for coming, please share your pictures" (we'll revisit this later)

I can't help myself so...

Not naming names, but many FBA aggregators are getting WRECKED by supply chain issues.

It's the combination of lots of debt, the challenges of running multiple brands at once, and a quirk of Amazon's FBA model.

Here's a behind the scenes thread of what's going down... 🧵👇 The idea of an "FBA aggregator" works amazingly well in a spreadsheet.

Buy lots of brands for low multiples, use mostly debt, raise capital at high valuations.

It's an incredible multiple arbitrage, and that's why so much capital has poured into the sector.

Easy, right?

.@wearfigs just filed to go public, and it's probably my favorite DTC IPO of all time.

💸$263M revenue
😍 26% EBITDA margin (swoon)
🧑‍⚕️1.3M customers in 2020
📈138% YoY growth

Let's break down their biz in a thread 🧵👇 Figs took something lame and generic (scrubs) and made them functional, comfortable, and cool.

85% of medical professionals purchase their own scrubs & healthcare is the fastest growing job sector in the USA at 22% growth since 2011.

They picked a target market with tailwind.

Damn. This is the most unreal (and yet depressingly so real) story of unintended consequences I've ever read. "Why Do Employers Provide Health Care in the First Place?" Some excerpts... hbr.org/2019/03/why-do… Can you imagine unemployment so low the government passes a law to prevent private employers from RAISING wages? So instead of paying higher wages, firms began offering fringe benefits (health insurance) instead.