Everyone knows Warren Buffet: the super-rich investing genius who drives a cheap car, guzzles Coke has shrewdly assembled a portfolio that’s made him billions.
What if you could do that with small eCommerce companies?
My first reaction to the idea is a million reasons why it’d be extremely difficult to pull off.
But Shakil Prasla of SZVentures.com has managed to build a portfolio of over a dozen stores, all run and managed by business manager who take care of the day today.
I do a deep dive with this mini Buffet on his process and we discuss:
- How he’s been able to get nonrecourse loans to finance deals
- His absolute favorite type of business to buy
- The 6 criteria he looks for when evaluating investments
Andrew: Welcome to the “eCommerceFuel” podcast, the show dedicated to helping high six and seven-figure entrepreneurs build amazing online companies and incredible lives. I’m your host and fellow eCommerce entrepreneur, Andrew Youderian.
Hey, guys. Andrew here, and welcome to eCommerceFuel podcast. Thanks so much for joining me today, and excited to dive back into part two of my discussion with Shakil from SZVentures. Shakil, as you know, if you listened to last week, runs a portfolio, really owns a portfolio of eCommerce businesses and investments. And last week we talked about how to hire, train, and incentivize business managers, people you can put in place to run your business day-to-day. Today, we’re gonna take more of a macro approach and talk about how he’s assembled a portfolio of, you know, more than a dozen different companies over the last five years, everything from deal sourcing, to negotiating terms, to the process of kinda coming out the backside and getting the business managers up and running, and his thoughts on just what types of deals that are his favorite as well.
Shakil’s “Warren Buffet” Style Approach
It’s very cool. He reminds me of, you know, Warren Buffett’s style approach. Warren Buffett, of course, built an amazing portfolio. He doesn’t manage them day-to-day, and his real value and focus is on the the deal making, the valuation, investing for the long term, and that’s what Shakil has done. And one thing that I find really impressive as well, I didn’t talk about this in the interview, but off mic I was chatting with him, and Shakil isn’t working 80, 90, 100 hours per week, obviously, doing very well, but he’s able to do this in a way where he works 40-ish hours per week, and that’s gonna vary, of course. If he’s closing a deal, that might spike up considerably, but he’s able to do this without selling his soul, which is really impressive. Anytime you can do something this impressive without completely tilting your life out of balance, I think that’s even more admirable and, you know, something I wanna learn from. So, let’s go ahead and get right into it. I will pick it up right where we left off last time talking about Shakil’s kinda…starting with his overarching strategy and then diving in.
Shakil’s Hiring/Nurturing/Coaching Process for Managers
So, Shakil, I’d love to take a little bit step backward and a deep dive on kinda hiring those managers, because I was fascinated with that. But, at a broad level, I wanna go through the process of how you do this, you know, maybe like a 30,000-foot view. So what’s your MO, your kinda playbook for going from finding deals, to closing them, to that transition period, really getting from when you don’t even have, you know, any deals that you’re considering all the way to the point where you’re having those weekly or monthly calls with your managers and just more or less nurturing them and coaching them along? What does that process look like in a high level? And then we’ll dive into the specifics.
Shakil: Well, all the way from the beginning, you know, I’m talking to you today, but all of a sudden there could be a deal that comes tomorrow. And usually whenever a deal comes for sale, I’ll ask for the prospectus. If it looks interesting to me, I’ll ask a standard 15 set questions that I ask, you know, and they include anything like, “Why are you selling your business? What are some growth opportunities you wanted to implement but you weren’t able to?” And, you know, questions like that. And once I get those 15 questions back, I’ll see if I wanna proceed further.
If I do, I’ll ask the broker, “Hey, can you get me on a call with the seller? Let’s get to know this business better.” If I’m still interested at that point, I’ll ask maybe some couple technical questions, and I’ll place an offer on the business usually depending on the other offers, if there’s other people bidding with me. If he accepts it, I’ll submit an LOI, we’ll go into due diligence, and I’ll ask a standard list of documents I need from them. So, you know, I’ll include a tax return, access to back-end system, analytics. And, for the next 30 days, I pretty much play a detective, and so I go into the finances to see how it’s looking, is it everything the prospect has said, are there any growth opportunities I could maybe implement on if I take over the business. Usually, during this process, I’ll also be looking for a business manager, and if I need financing, I’ll engage a bank as well.
After the 30 days, we’ll kinda beef up our terms, and we’ll come up with an asset purchase agreement, and usually, with the asset purchase agreement, I’ll ask the seller to stay on for at least, you know, 60 days. The standard is 30 days. I’ll ask for at least 60 to 90 days at which point we fund the deal, I take over the company, I hire the manager, and at that point we work hand in hand with the previous owner on learning the business. Now, I’m a student. Now, I’m learning the business with my business manager, coming up with processes, and procedures, and manuals. And once the 60 to 90 days are up, it’s time to execute. For the next four months, I try to see where I could automate the business, what are some low-hanging fruits we could implement, and just do that. And after, you know, six months, I pretty much am hands off. The manager runs it. We have a weekly call. I’m available on Skype, on Slack. Yeah. That’s the high-level 30,000-view.
Three Deals in 12 Months
Andrew: So you mentioned you’re digging on the prospectus. How many deals on an average year would you close, two to three?
Shakil: Yeah. You know, so I probably look at one to two deals a day, and this is just kinda high-level, what the business is called. From then on, I will probably ask a prospectus for about 100 of them, and this is a year. Out of the 100, I will maybe ask some follow-up questions, 30 of them, and then I will place an offer on 6 of them, and I’ll close about 3 of them. So that’s exactly what’s happened in the last 12 months, is I’ve closed 3 deals.
The Deal Flow
Andrew: And where do you get your deal flow? I’m guessing you’ve got traditional sources on, like, business brokers, places like Quiet Light Brokerage or FE International. Where do you get most of your deal flow, and, maybe even more interestingly, where do you find deals that… Give any interesting sources of deal flow that maybe give you an advantage over other people.
Shakil: Well, certainly. There are brokers that come to me first and say, “Hey, we have a listing that’s coming for sale. Would you like to take a first look at it?” And these are brokers who I’ve bought from in the past, right? So I’ve bought seven businesses, and I’ve kept the relationship with all of them, and these are well-known brokers, right? These are Quiet Light Brokerage, you have your FE International, Website Closers, Website Property, Empire Flippers, all those guys. But all these companies, all these brokers list their business on BizBuySell. And here’s a good way for people to find businesses for sale, go to bizbuysell.com, type in the income you’re looking for, type in the revenue you’re looking for. When you click Search, there’s a pop-up that comes up, and it will say, “Do you want weekly alerts on this?” Click Yes. Enter your e-mail address. Now, every week you will receive a business that comes for sale right away. You can keep that daily, but this is, you know, a good way to really see any businesses that are coming for sale, online businesses.
Criteria for Buying a Store
Andrew: And what are your most important… You’re looking at all these deals. One of the criteria you have for buying on your site… I think there’s six that I found on your site. Maybe I’ll go through these. Maybe you can just mention if there’s any that I’m missing. But you’re looking for something’s that’s an evergreen niche. So I’m guessing something that is not fetish, has a year-over-year growth, has been in business at least a couple years, at least half the traffic is organic, serving an underserved market, it has at least 100k in net profit per year. Are there any other that I’m missing, or are those the big ones?
Shakil: Yeah. And I would say, out of those, you know, five or six you listed, the two biggest things for me are how long has the business been in business. That’s number one, because the longer it’s been in business, the more sales strategies it comes with, the more things that are worked out it comes with, you know, the better suppliers, the bigger customer list it comes with. That’s a big thing, and the second big thing is growth opportunities, you know, what are some low-hanging fruits I could implement right away. You know, I could go through all seven of my businesses, and, you know, Andrew, you’ve been in eCommerce for a long time. If you look at the prospectus, you’ll definitely be able to identify the two or three things, growth opportunities. I was as well. You know, these are things like this guy is selling on eBay. At least, I am selling on Amazon. He has 15,000 e-mails, but he doesn’t even utilize it. So it’s growth opportunities that I look for that are huge when I want to take over the business.
The High Cost of Organic
Andrew: You have in there 50% plus organic traffic, and on one hand you can make the argument that’s great, because you get free traffic. On the other hand, you could make the argument, potentially a liability as someone who’s gotten hit and lost 80% of my organic traffic overnight. It’s a scary thing, whereas if the business can be profitable through paid channels, then it’s a little bit. You always have the risk, of course, of the ever upward creep of paying for customers and CPA cost. Why is it in your pro list versus potentially a liability?
Shakil: That’s true. Well, when I first started buying online businesses, I was pretty much looking for businesses that did only organic traffic. You know, over time, in the last four years, things have really changed. There’s different ways you could get traffic, right? There’s Facebook Ads. There’s Google Ads. There’s e-mail marketing. There’s Facebook Messenger. So it’s definitely evolved over time. I wouldn’t say the organic is a big thing to me now. You’re absolutely right that it could become a liability, there could be algorithm shifts. So that definitely has shifted over time, but that was initially what I looked for just because it’s free paid traffic, right? That’s one way I value the businesses. If it’s getting 10,000 clicks a month on socks, and if you look on PPC to how much socks cost, let’s just say it costs $2 a click, that means, you know, I’m getting $20,000 worth of free traffic every month. And that’s how I initially was valuing businesses, is, you know, how do I come up with the valuation for that.
Red Flags To Watch For
Andrew: What little things do you read into during that process? I mean, we do all that. The due diligence process and what to look for, it’s pretty involved in a month, I would imagine. But, in a high level, are there little things that you read into that you found are either a really good sign out of the gates or a big red flag? And it could be anything from the attitude of the owner to the books, to the broker, to the niche. What things do you read into that people who are just getting into this might not read into as much as they should?
Shakil: Financials is a big thing. There’s gonna be add-backs that the broker or even the seller kinda adds back to that. Necessarily isn’t an add-back. For example, the owner’s salary, that’s an add-back, that’s fine. But maybe there’s another employee that’s part-time. They may consider that an add-back. They may add back failed Facebook strategies. So if I spent, you know, $100,000 last year, and it was unprofitable, some brokers may even add that back. So, you know, those are big red flags that I stay away from.
Another thing is the owner itself, right? Is the sale being driven because of the technical knowledge of the owner, right? So I was looking at this car parts business for sale, and the guy was a mechanic, and he was naturally a salesman, too. There’s no way I could replicate that. It would be very hard to get a business manager and replicate something like that, too, right? I would think, you know, a business would fall because of that. So that’s another thing, is seeing how much technical knowledge the owner has and how much can that be transferred over. Financials, like I said, was a big thing. I think those two things really stand out to me first before I even dive deeper.
Tips on Making an Offer
Andrew: When you go to make an offer, do you have a way you typically proceed, or does it vary based on the deal? And I guess what I’m really asking is do you tend to go in with an offer that’s 10%, to 20%, to 30% lower than asked? Do you tend to kinda take the mentality and approach of, “If this is a great business, I’m gonna give him a pretty reasonable full priced offer and not fight over some pennies to save, the expensive dimes or dollars”? What are you thinking about, and how aggressive are you with your price and your terms when it comes time to make an offer?
Shakil: Initially, I keep very loose terms. I mainly base it on the asking price rate. So it really depends on the deal itself, but I would say a general rule of thumb is you could get at least 10% off asking price. And it really depends on who else is bidding against you, right? If you lowball, the broker will not take you seriously. They’ll probably not even entertain you anymore. So I usually do at least 10% to 15% off asking price, and I usually see how the broker comes back. The broker will usually tell you, “Hey, you know, thank you for the offer, but you’re still not the highest bidder.”
If I really want the business, you know, I’ll tell a broker, “Look, I really want the business. I’m an eCommerce. I think I could grow this business. What can I do to get this business?” Usually the broker may or may not work with you, but that’s where you build that relationship with the broker, too. You build that trust with them. You know, you show them that you’re well-versed in the business. They also look at if you have money. If you could give an all-cash offer, you will probably get the deal, you’re more favorable to get the deal versus other people.
Andrew: I imagine, given your track record, having done this for five years, making, you know, a dozenish acquisitions, building that reputation with the brokerage firm or even individual brokers, that’s gotta be a huge at least somewhat of an advantage, because they can go back to their client and say, “Hey, you’ve got offers from five people. We don’t even know three of them. Number four seems great, but they don’t have financing. But number five is this Shakil guy. He’s played favorably with us in the past. He’s come through. He’s reasonable.” And even if you don’t come in with the absolute top dollar price, that’s a big deal when you’re considering and trying to, you know, consummate a, you know, 30 to 90-day closing process, I guess. Is that fair?
Shakil: Yeah, absolutely. I mean, I think I do definitely have an edge because of my experience. Remember, these sellers that are selling their business, they have planned for the last three to six months to get to where they are, right? They’ve had to fix their financials. They had to streamline their operations. You know, they’ve gone through anxiety, and I’m sure their anxiety levels are pretty high when they’re trying to sell their business. This is their baby they’re selling. This is everything that they’ve put their sweat equity into, right?
So this is where I come in, and I calm them down and say, “Hey, look, I’ve gone through this before. I’m not gonna nickel-and-dime you on the financials.” You know, “I’m not gonna ask you all these, you know, questions. Let’s just get the deal done.” So I think through that experience it definitely helps them more and allows me to have a lower asking price, because I’m able to close quicker and also just not, you know, dig around too much in due diligence either.
Financing New Ventures
Andrew: With financing, how do you look at that? You had some great post in the form of SBA loans. I’m thinking through those. And, as a general rule, it sounds like you’ve financed most of these deals. How do you do that? Is it through SBA loans? The tricky part about those is those can be… There’s a lot of red tape and paperwork given the fact that a lot of traditional banks just don’t even understand how this kind of deals, especially on the eCommerce side, work. What does your financing look like, and how do you finance most of your deals?
Shakil: Yeah, you’re right. I do finance most of my deals. I do a lot of financing. I think that’s where you really make more money. You know, essentially, if you’re buying at a 3x multiple, right, that pretty much means you’re getting a 33% return on your money. If you could borrow at 5% and make 33%, that always makes, you know, sense. You know, that’s a very simplified version of that. I usually finance through, you know, smaller banks. I’ve done an SBA before, I’ve done unsecured loans, I’ve done a personal loan through the credit unions, and I’ve done owner financing. So it really just all depends on the deal itself, but, yes, I definitely usually like to borrow on a deal.
Andrew: You mentioned one of them all. You said you did a personally guaranteed loan. The experience I’ve had with people financing deals, almost all of them actually had to seal that. I’m guessing the individual deals you do, in my experience, they have to be personally guaranteed. How do you set up… Talk to me about how if at all you’re able to get financing from banks without having to provide a personal guarantee.
Shakil: Yes. Those are the unsecured loans. I was able to get twice already 60% financing. So I only had to put down 40% on unsecured loan. It’s for five years, but that really depends on your credit, and it depends on the business income, right? So, if the business income is more than enough to pay the debt off every year, then you’ll look more favorable to the bank. If your credit score is high, you’ll look even better.
Andrew: That’s amazing. So, just to clarify on security, if for whatever reason that business wasn’t able to service that debt, the bank would not have recourse. They could come after the assets of the business, but personally they can’t come off to your house or your personal assets outside of that business. Is that… And that you were able to get that with 40% down.
Shakil: That’s correct. Yeah. That’s correct.
Shakil: And it’s happened twice, but the more you do this, the less likely you are now of getting financing. So I think I’ve definitely thinned myself out, but, yes, there is ways, and some banks will do that for you.
Befriend a Banker
Andrew: Do you have a relationship… I imagine, just like on the broker side, when you build rapport and relationship, it’s helpful. Do you have someone at one of those local small banks that, you know, he or she sees you coming, and you sit down, and they say, “Oh, Shakil, what kind of business is it this time?” They trust you. They’ve seen that, you know, you’ve been able to pull this off a number of times, and getting financing is much easier now. Or is it kinda ad hoc, start from the beginning every time?
Shakil: It is. It is actually start from the beginning all the time, because I think banks have different rules and regulations, and different quota, and stuff that they have to reach, and stuff. So it depends if I can get them at the right time. So I do just like, you know, brokers I keep a relationship with. Same with bankers. I try to keep a relationship with many of them, and once I’m ready for a deal, you know, I send an e-mail to all of them saying, “Hey, look, I have this deal. I want it. Can you guys give me financing?” And, you know, I’m hoping one of them actually say yes. But I do work with many of them. It just depends on who’s willing to give me the loan and at what rate.
Andrew: Have you had any deals where you’ve gone through, you’ve financed them, they haven’t been non-secured, the business has blown up, and you’ve been on the hook for the total amount? Has that happened, or has that not been an issue?
Shakil: It has not happened, but it became very close where sometimes I didn’t have any money in the bank to pay those loans off, and so I had to borrow from other businesses. But, luckily, it was only for a couple months, and I haven’t had any long-term issues. Again, when you finance, you’re taking on a bigger risk, and to mitigate that risk, you have to look at growth opportunities. Are there really some low-hanging fruits that you can actually implement that will help grow the business? I’m not gonna buy a business at a 3x expecting to make my money back in three years, right? I’m buying it at a 3x so I can make my money back in two years, is the goal. So I think that’s one way to really mitigate the risk, is if you’re gonna take on financing, make sure you have some actionable items that you could implement to help grow the business.
Streamlining The SBA Process
Andrew: Any tips for people on streamlining what can be a very cumbersome SBA application and approval process?
Shakil: Oh, man. Oh, man, SBAs. They are…
Andrew: We have four hours. If you need it all, we can use it.
Shakil: Oh, man. They ask a lot of information. Just have your tax returns ready if you’re gonna go for an SBA. The one thing I would recommend you do is ask the seller to provide their business tax returns. I was once looking at a business for sale, and, you know, it was a fairly larger deal. I think it was asking $1 million. It was making $350,000 on the prospectus, right? I placed an offer, take it to due diligence, and, you know, I told the seller from the beginning, “I’m gonna do an SBA on this.” He said, “Yeah, that’s fine.” I told him it’s gonna take at least 60 days, and he said that’s fine, too. You know, the bank was like, “Can you give me their tax returns?” I give them their tax returns, and their income shows $60,000 instead of the $350,000.
And the reason why it was so low is because, you know, one way or the other, you know, obviously, on your tax returns you’ll try to pay the least amount as you can, you’ll do write-offs and stuff. But he had some red flag write-offs. And the bank told me, you know, “I’ll do some add-backs, but you’re only going to get a $200,000 loan.” And, for me, you know, I was expecting at least, you know, $700,000 loan. So, you know, definitely ask the seller for their tax returns to make sure it matches or closely matches the prospectus income.
Have your three years tax returns ready. Have a conversation with the bankers saying, “Hey, I’m gonna be bringing a deal to you. What is everything that you need to have?” SBAs also require a life insurance. So just, you know, be aware of that, and then, you know, they ask a bunch of documents. But definitely, you know, educate the buyer or the seller that, “Hey, it’s gonna take a little longer, but bear with me, because I want this deal.”
Doing Your Due Diligence
Andrew: Let’s say you make the offer, you’ve got the financing in place, and you’re in diligence, or the financing is pending. What do you… On the diligence side, two questions. Let’s say it’s a 30-day diligence period. How much of your time are you actually doing diligence? Is this a 40 hours, 50, 60 hours a week process for a month, or you’re just diving in…it’s a 100% of what you’re focusing on? So how involved is it? And then what are, you know, let’s say the two or the three biggest things you are looking for when you’re turning over rocks to potentially make sure that you’re buying what was represented?
Shakil: Yeah. Well, initially, I do… You know, the due diligence is usually 30 days. The first week, you know, I’m working, you know, 40, 50 hours definitely uncovering the business, the financials, the back end, the customers, learning the business. Afterwards, you know, I’ll ask them some follow-up questions and say, “Hey,” you know, “Can you explain this for me? Can you explain that for me?” And, you know, from going on, you know, I’m spending less time on it and more on kinda coming up with the deal structure itself.
But, you know, definitely the biggest red flags I’ve seen is in the financials, you know, sometimes. You know, for every dollar and profit you’re adding on the business, that’s $3 in valuation. So, if you’re showing an extra 10 grand in profit, you know, you’re adding 30 grand on valuation itself. So I definitely, you know, look at the financials itself. Lucky for me, my business partner in my last two deals is a accountant, and he’s definitely helped me out in that aspect. But, yeah, I pay a big attention to financials and the operations.
Andrew: So let’s say everything comes to the day of signing. What percent of the deals do you get to a point where you find maybe some issues that you have to work through and negotiate? In the due diligence period, how many times are the complexities, but when you come to close the deal or as you’re getting closer to it, how much the time is a pretty smooth sailing?
Shakil: Well, I would say half the time it’s a smooth sailing, half the times it’s not. It’s hard to really get down the terms down. You know, asking price is one thing, but then getting the terms down is another thing. So even asking 60 days from the seller to help out with the business, you know, they’ll say no. You know, “I can only do 30 days. If you want me for the other 30 days, you’re gonna have to pay me $200 an hour.” You know, so you have to get those terms down. A little hiccup we had in our last deal, was cardsforcauses.com, is there was a trademark that was very similar to Cards for Causes.
And we had just recently learned about it, because, you know, it’s a fairly large purchase, and I wanted to trademark the name. I started doing some research on it, and I found out that, hey, there’s a word that’s very similar. And so from then on I had to hire a IP attorney to see what the stats were. He recommended that I not buy the deal, or if I were to buy the deal, that if a problem arises in the future, he would pay those legal costs. So then those are some terms we had to figure out. So, yeah, there’s definitely gonna be terms that you need to iron out besides the asking price.
Trusting Others To Make Big Decisions
Andrew: So you’ve got that all taken care of. You hopefully close the deal. We covered a lot of that, you know, what you do from closing, everyone on board, bringing on the managers before so they won’t delay on that too much. Stepping back a little bit as we’re getting close to closing here, what are some of the biggest complications that pop up with your model? We’ve touched on some of them, but at a high level I was almost thinking about doing this. What part is gonna frustrate them the most about this entire process that to succeed you really need to be able to just solve that problem or a small set of problems?
Shakil: I mean, I think it’s definitely not taking on a hands-on approach. I am pretty much trusting my business managers to run the day-to-day operations. They’re doing bulk of the work right there. If you don’t have a good business manager, your business will probably tank. You know, I think my business is as good as the people I hire. If you don’t have trustworthy people, your business may not do well. It’s really hard to trust someone to run the day-to-day operations. Especially when you’ve purchased the business, you’re looking for the quickest return. Especially when you have financing, when something goes bad, you know, they could come after other assets. So I think that aspect of it makes it a little risky, but that also allows me to grow businesses. So, I mean, I think, you know, having a good business manager is, you know, one of the most important things you should have in the business.
Deciding to Keep an Owner On
Andrew: Have you ever explored investing in existing eCommerce businesses that are run by owners versus buying them, acquiring them, and putting the team in place? I know you’ve had an experience where you bought a business and kept the owner on for a while. Maybe you can share that experience if you wouldn’t mind, but then also just your general thoughts on, you know, why not approach existing owners and invest in them versus trying to go through all the work of acquiring something and then bringing somebody on and teaching them.
Shakil: Yeah. So if I were to keep the old owner on… Remember, these guys have been running the business for five years, five, six years, or whatever years they’ve been working on. They have been doing it a certain way. I’m coming in, and I’m saying, “All right, let’s change this up, change that up.” You know, people don’t like changes when they’ve created something. So we’ve definitely had some problems there, and that’s where my problem came with my partner, was when you partner with someone you don’t know, you’re pretty much marrying them, right? You’re gonna see and talk to them every day. You’re gonna have problems with them. You have differences, so do they. If you’re not able to work together, there’s definitely gonna problems.
For this particular company, I kept the owner on, because he was really good at marketing. I bought this business, and one of the things he said to me when I was doing due diligence was, “Hey, Shakil, you know, I stopped the Google Ads, because I was getting too much traffic,” and my jaw just dropped. I was like, “Did you really just say that? You stopped your ads because you were going too much traffic?” And he said, “Yeah. You know, I don’t like dealing with customers.” And I said, “Well, that’s good. You know, I like customers. I could do that front if you could carry on the marketing.” Things went well the first year.
You know, lucky for me, I was able to make my money back in six months, and, you know, it was a really, really great deal. Second year comes around, and he feels a little taken advantage of, and he wants more equity, and he wants to do this and that, and that’s where we kind of broke off. That’s where our goals started misaligning. You know, when things are well, everyone’s happy. When things go bad, that’s where people, you know, really show their colors. And, unlucky for me, we did not have any operating agreement in place. So he pretty much just said, “Look, I’m just gonna collect a check, and I’m not gonna do anything anymore.” So, unfortunately, I had to buy him out at a little bit of a premium. Yeah, there’s gonna be those problems there, and so that’s why I prefer not to keep the old owner on, because they come with a different mindset. They’ve worked on the business. They’ve grown it in a certain way. They may not be open to the way you want to grow the business.
Shakil’s Favorite Business Model
Andrew: You know, Shakil, I may have a last question here before we jump into the lightning round. You’ve looked at and purchased a wide variety of models of businesses, Amazon businesses, drop shipping, private label, affiliate. Which one of those is your favorite? Obviously, you know, in eCommerce a lot of people are listening the same, and it can be easy to just continue to do what you know and not consider alternatives. But if you could just have wonderful deals of a certain type of model fall on your lap all day long, which model would it be?
Shakil: Custom products. I love custom products. I love, you know, creating something for the customer and then them placing the order. I love investing in technology where they’re able to build that product on our website and order it. I think there are higher margins, I think there’s less competition for that, and that’s the way I’ve been going to.
The Lightning Round!
Andrew: Very cool. Shakil, this has been phenomenal. Thank you for sharing all this stuff. It’s something I… It’s so fascinating to hear how you make this work and your thought process behind it. Wrapping up, but, first, I wanna do a lightning round with you. I just have a handful of questions that, you know, of course, like the name implies, feel free to answer quickly off the top of your head. So the first question is, if you had to identify the number one thing you’re trying to optimize your life for right now, what would it be?
Shakil: Optimize something in my life, time. Time is the most valuable thing to me.
Andrew: Who’s someone you strongly disagree with?
Shakil: Who do I disagree with, oh, Trump. My man, Trump.
Andrew: My man, Trump. How much money in the bank is enough? What would be your number?
Shakil: I would say $50 million.
Andrew: And what’s the worst investment you’ve made in the last 10 years?
Shakil: I invested $100,000, part of a VC fund, in a donation platform. Three months later, I ran out of money, worst investment ever.
Andrew: Was it on a rough day?
Shakil: Yeah. Oh, yeah.
Andrew: And then what’s the best investment apart from your business or your business portfolio that you’ve made in the last 10 years?
Shakil: I would say getting my MBA. That was a good investment.
Andrew: Finally, what was the first CD you ever owned if you are brave enough to share us with it?
Shakil: CD, I think in the ’90s he was called Puff Daddy at the time. Now, he is called P Diddy.
Andrew: Love it. Oh, awesome. Shakil, well, so this has been phenomenal, hearing how you do this. You’ve been wanting to come in and share the secret sauce and what you do behind the curtain. Thanks so much for being willing to talk about it and for being a part of the community. I’m looking forward to hanging out with you in Laguna, man.
Shakil: Cool, man. See you soon, Andrew. Thanks a lot for having me.
Andrew: Want to connect with and learn from other proven eCommerce entrepreneurs? Join us in the eCommerceFuel private community. It’s our tight-knit vetted group for store owners with at least $0.25 million in annual sales. You can learn more and apply for membership at ecommercefuel.com. Thanks so much for listening, and I’m looking forward to seeing you again next time.
What Was Mentioned
- Andrew Youderian: Blog | Twitter | Facebook | LinkedIn
- Shakil Prasla: Website | Twitter | Facebook | LinkedIn
- SBA Loans
Photo: Flickr/Mohamed Jhangeer