Hey all! Here's a quick podcast that's especially useful for those of you looking to buy online businesses (SaaS, eCommerce, content, FBA, etc.) that focuses primarily on due diligence pitfalls. Three takeaway points:

1. — Buyers often underestimate how long it will take for THEM to operate the business post-acquisition by simply taking how long it takes the current owners to operate it. It often leads to overwhelmed and burned-out first-time buyers. Typically, the current owners have been operating the business for a long time and a lot of things have become second nature to them. You'll get there but it's folly to assume you'll be putting in the same time to operate the business that the current owners do.

2. — This ties into point #1 as we'll often see tech-savvy buyers think they can take a business with manual and cumbersome processes and cut them down with software and automation right after they acquire it. Sure, you can and absolutely should do that eventually but the truth is, you have to learn those manual and cumbersome processes first, which is time-consuming. After all, to automate anything, you need to learn the manual processes first. That's the only way you'll know how to automate it.

3. — Focusing on revenue validation is incredibly important but revenue almost always aligns if you’re buying from a reputable broker because after all, it’s very easy to validate revenue for most online businesses. It’s a lot easier to omit costs than it is to create fake revenue. Your focus should be on validating costs are aligned, add backs are justified, and that expenses aren’t being omitted. That's where a lot of the trickery happens.

Here's the full episode: https://podcasts.apple.com/us/podcast/lets-buy-a-business/id1506985601