Selling a Business, How to Invest & Building Community — A Discussion with Ian Schoen

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Double Your eCommerce Business in the Next Year requesting the most effective growth and profitability strategies we've unearthed from 5+ years of studying successful stores.

Wondering what it’s like to sell your business? Or how much you can actually make through passive investments? Both are more complex than you might think, and it pays to hear from someone who knows both.

Ian Schoen of and the Dynamite Circle answers questions about recently selling his own small business, the idea that passive investments can build substantial wealth, and building entrepreneurship communities.


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(With your host Andrew Youderian of and Ian Schoen of

Andrew: Hey guys, Andrew here, and welcome to the eCommerce Fuel Podcast. Thanks so much for tuning in. Today on the show, I’m joined by Ian Schoen from the TropicalMBA blog and podcast. He’s also one of the men behind the Dynamite Circle, which is a private community for location-independent entrepreneurs. I really always enjoy talking with Ian, and our conversation today covers a lot of different topics. We talk about his recent business sale, we talk about how to invest money.

Both of those topics are a couple of episodes that I really enjoyed from his podcast recently, and we can get into those. And then finally, we talk about running private communities. We both run private communities for entrepreneurs and talk about some of the challenges, some of the things we really enjoy, get a little bit inside baseball on that. It’s not eCommerce specific per se, but if you’re in the community or it’s something you’re interested in, hopefully it’s something that you enjoy.

Ian, you and your partner Dan recently sold the business, congratulations sir!

Ian: Thank you. Yeah.

Andrew: Are you sick of talking about it yet?

Ian: No, I’m not, I’m not actually.

Andrew: What caused you guys to sell?

Ian: Oh man. Well, I think essentially what happened was we started the business in 2008 – at the time I think I was about twenty-five, twenty-six years old, and you know that was a long time ago. I feel like I’m a different person than I was then. You know, I felt like I wanted different things out of my business and my life, and we just kind of reached an interesting point.

I think one of the feelings, one of the emotions that I had at the time when we decided to sell was that it’s all been like high-fives and good times, essentially. I mean, there was some growing pains and whatnot, but we never missed payroll, there was always plenty of cashflow, it was just really good times. And I thought, “let’s just leave this on a high note, ‘cause I’m not super passionate about the business anymore, and I don’t wanna fake it to my employees anymore that I’m not into this business, so let’s just leave it on a high note.”

Ian’s Insight Into Selling His Business

Andrew: And you said you wanted different things out of your life and your business – what specifically were you looking for in terms of change, things that the business wasn’t fulfilling, apart from the passion aspect and selling at the top – which makes a lot of sense – what was that underlying thing you kind of alluded to?

Ian: I think just change in general, you know? Like I said, I started the business when I was in like my mid-twenties and quite some time had gone by, so I just wanted to see kind of what other options were out there, you know? I felt like I had conquered that business in a way, or at least the skill set, and for me and I think a lot of small business owners, that’s kind of what you do, right?

I mean we were selling like hospitality equipment and although I was passionate about that in the beginning, it became more about the process of doing business. So through the process learned SEO, learned ad words, learned how to manufacture products in China, learned how to build a team of fifteen. So kind of all these things that I wanted to learn in that business I learned; I just didn’t feel like there was much more for me to learn in that environment, and I just felt like there was probably a better place for me to learn new skills.

Andrew: Was it a pretty easy decision to sell? Obviously you had some pretty strong, compelling reasons, but I know in chatting with people and from my own experience that sometimes you’ve got great reasons to sell and it makes a lot of sense logically, but looking at it from a financial point of view, and you run the numbers and you think “where in the world am I gonna get this return on two, three X ballpark multiple, there’s almost nowhere,” was that tough? Was that a decision you really had to wrestle with or not so much?

Ian: Yeah it’s a good question. You know, when you say, “you can’t get those kinds of returns anywhere except for a small business,” I wholeheartedly agree with that, but it’s certainly not a passive investment. So, considering the fact that, you know, 1in most small businesses, if you’re in my position you’re gonna have to be the CEO, or someone that actually has to show up at some point and make decisions.

I think what most companies that are our size, you know less than fifty employees, under ten million dollars, you know, I viewed it as like I’m gonna have to keep showing up. So I’m gonna keep kind of managing this investment. So, it was easy in the sense that I thought, “hey, here’s an opportunity for me to cash out and not have to show up for the next two to five years,” but it was hard in that I knew the process was gonna be difficult, and it was not just gonna be a three-month transition period.

Lessons Learned Post-Sale

Andrew: You and Dan did a great episode on what you guys learned selling the business, and I won’t rehash everything in this episode but we’ll link over to it, but in a nutshell: easy process, difficult process? What was the biggest thing you learned going through the sale?

Ian: Difficult process, I’d say, for sure. I thought it was gonna take less time than it did. I think, gosh, start to finish, it was a little bit over a year from when we decided to sell the business to when it actually sold. I was pretty naïve about that, I mean I thought it would take, you now, several months, but I didn’t realize it was gonna take that long.

But it gave us an opportunity to get our story straight, I mean we talked to probably five potential buyers through the process, and so that was a very interesting experience for me. That was essentially the largest sale I’d ever made. You know, you make these little sales along the way to your clients and whatnot, but this is the big kahuna.

Andrew: Yeah.

Ian: The process was definitely a learning experience and I’m glad that we went through it and I think part of me wanted to go through that experience just to fulfill the title of “entrepreneur,” you know? Like, somewhere inside of me was like, “I’m not an entrepreneur if I can’t sell my business.” And so, I feel like I fulfilled that, and looking back on it, I’m like 100% confident it was the right decision. You look at the cash flows and you say yeah, I miss that, on a monthly basis, but I don’t miss this feeling.

I mean, we had an eCommerce business Andrew which obviously you and your audience are very familiar with. On the first of the month, the counter resets and so it’s like zero, and every month you’ve gotta get up to whatever your revenue goals are. And for us, you know, we had full-time employees, we had overhead, and everything. So it wasn’t just like we wanna get to these numbers, like we have to get to these numbers. And I think that that was a pretty big stress in my life was making sure that we hit those numbers. And so, you know, I don’t have that in my life anymore and I don’t miss it at all, actually.

How to Invest to Seize Opportunity

Andrew: Speaking of passive investments, again you guys had that great episode recently on how you invest your money over on your podcast. How have your thoughts changed on that? I know, you know, we talked about this. I think last year we had a discussion on, you know, what do you do with your money, with just cash, because the options were seemingly just terrible.

You know, the last couple weeks I had a discussion with someone who just sold their business, along the same lines, I feel like I have this discussion every month or two, how have your thoughts changed on this in terms of passive investments? What have you been investing in, or what are you investing in?

Ian: Well, this house is obviously one thing. In terms of other investments, I’m looking for businesses to buy. I’m on probably all the usual suspects lists, so when a business comes out I take a look at it. And in terms of passive investments, you know, I haven’t really identified too many. I think for me, my strategy is basically this: to keep cash in the bank for when opportunities arise.

So, in my limited career, I’ve seen and been around people that have much more experience than I do. And they seem to see the biggest upside from being able to buy low. So, when the market takes a dump, which I feel confident it will in the next couple years – maybe even after the election – I think that there’s gonna be some opportunities that pop up and I want to be ready for that, you know? I wanna be able to swoop in when people are in trouble and leverage my cash.

So in terms of what I’m doing right now, I really haven’t bought much, except for this house, after the sale, because I’m waiting for cash to be the best position. Unfortunately right now, Andrew, as you know, it really isn’t yet with interest rates and whatnot being so low, but I think in the next couple years we might see that change.

Benefits of Offshore Accounts

Andrew:  You mentioned the DC, we’ll get into the DC in a minute, very much about being location independence, freedom, and also to an extent being diversified across different nations or at least having a global business, or taking advantage of global infrastructure in countries. Have you moved any money offshore either for tax reasons or just to protect against sovereignty risk?

Ian: Yeah, we have a company that’s an offshore company and yeah I have some funds over there. And it’s not so much a hedge on currencies or anything like that, but it’s an option. So basically, we have a corporation over in Hong Kong, and the way that it’s structured, essentially you can keep your profits offshore.

And so, as you know, if you have a corporation in the United States, whatever you make that year in that corporation you’re taxed on that year. And so, it’s more of a strategy, I guess I would say, in terms of being able to earn the profits when you’re ready to earn the profits. So last year, made a bunch of money with the sale of the business – you don’t necessarily want to make more money, right, ‘cause you’re already in a high tax bracket. So it gives you that flexibility and that freedom to earn that money in distributions or salary when you see fit, if that makes sense.

Andrew: So you don’t have to pay taxes on it until you distribute the money that the business has to yourself personally in the U.S. more or less.

Ian: Correct. Yeah.

Andrew: That makes sense.

Ian: And so, that’s just a strategy. And you know, I think moving forward, these offshore corporations can afford you those kinds of benefits, but it doesn’t come without headache. So, a lot of the regulations and whatnot to be in compliance with the United States, that’s all very important, and you have to have to stay on top of that, and it costs a lot of money to do that. You know?

Andrew: Yeah.

Ian: And so, I think you really have to ask yourself, is the upside worth it, and is the upside worth it in your situation. You know, there’s been some years for me when it’s been worth it, there’s been other years where it hasn’t.

Passive Investments: Can They Make You Rich?

Andrew: You’ve got the opportunity to chat with a lot of successful entrepreneurs in your community and elsewhere. Have you met anyone that you feel like has done a rally good job in the stock market with passive, passive investments? And by a really good job, I mean like, let’s say they’ve earned or built the majority of their wealth through investments.

And obviously we’re a little bit biased, ‘cause you know, we’re in our thirties, this is something that’s going to be much more skewed toward people that, the older you are the longer you have for those gains to compound. But, can you think of anybody that you feel like would say, “Yes, the stock market, passive investments, index funds, have been a game-changer for me”?

Ian: No, absolutely not. I mean, I know a lot of people that have a million dollars in the market, and they make you know somewhere between seventy and a hundred thousand dollars recently off that money in the market, and so that’s enough for them to sustain their lifestyle, but they didn’t make that money in the market; they made it in small businesses and stuff like that and they put it in the market, and now it’s a way for them to passively fuel part of their lifestyle.

And I think that that’s valid, you know. But no, I don’t know anybody…well, with the exception of one friend that day traded for a year and made a bunch of money, but absolutely not sustainable if you asked him. You know, most of the people that I know have money in the market and it’s not a large percentage of their net worth. Is that your experience as well?

Andrew: Yeah, it’s funny ‘cause you feel…’cause I come from the financial industry, and you know the area where people say, hey, you know, the financial industry, a guy who’s taught like Dave ??? classes, and so, I believe in personal responsibility with finance and investing well, but I think this idea of you can get just wildly rich by saving a hundred dollars a month and putting it in an index fund and by the time you’re fifty you’ll have five million dollars, I think the calculations on that a lot of times people don’t get into the nuances and kind of the assumptions that are not practical at all, and don’t track with reality. So, no, I haven’t, I haven’t met anyone who’s become wildly successful, especially in their thirties and forties just from investing.

Ian: Yeah, it’s interesting, we did an interview with Mr. Money Mustache, who’s one of my favorite bloggers, and that’s gonna be going live pretty soon, and we talked to him about some of these questions as well. And I do think it’s interesting, because one of the things that gets preached in that community is living frugally and putting money into the stock market and watching it grow and retiring early.

And I think that that’s…it is a strategy that works, but I do not think that you will get rich doing that. And it’s not everybody’s goal to get rich, certainly, and I think it’s a lot of people’s goals to just simply live comfortably, and I think that you can absolutely do that with those methods. But I have not seen anyone reach a large, large net worth through investing like that.

Community Building for Entrepreneurs

Andrew: I’m gonna be a little bit selfish here, this may not be AS riveting to most people listening as you know, maybe me and potentially you, but since I’ve got you on I’m gonna subject people to it. And I want to talk about community building, ‘cause obviously we both run communities. Yours is called the Dynamite Circle, and just for people who might not be familiar with that, I’ve been a member for a long time, can you give just a super-fast overview of what the community is and what it’s focus is?

Ian: Yeah, so the Dynamite Circle is focused on location-independent entrepreneurs, people that are building small businesses around the globe, leveraging things like foreign corporations, and doing things like what you guys are doing in your community, Andrew, so a lot of our members have eCommerce businesses, some of them have information product businesses, but what I think bonds us all together is that we’re interested in travel, lifestyle, and business. And it kind of depends who you ask which order is the most important.

Andrew: What’s been the biggest challenge with running the DC and as you’ve grown – for us, for example, something we’ve really run into this last year, especially, getting a little bit bigger, is keeping our quality of our members high, and especially the intimacy high as you grow. Like one of the reasons, I think, members join that we’ve heard is they like that sense of community, they like the sense of being well-connected personally with people, and sometimes, like, the goals of the community, especially if you look at it through a business lens – you know, grow as quickly as you can, generate the most revenue – sometimes are like, diametrically opposed with what a community great.

Ian: Yeah.

Challenges for a Growing Community

Andrew: You know, community inherently is based on close, intimate relationships, and not growing so big that you lose your identities. So that’s something that we’ve really been struggling with and thinking through to make sure that we don’t let that ultimately get us in the end and make sure that’s something we’re addressing. Is that something that you guys have faced as well, or what have been some of the challenges as you’ve grown?

Ian: I think that you’re absolutely right there. So, while I was building the eCommerce business that we sold, my business partner Dan had started to develop the Dynamite Circle, and now we kind of work a little bit more closely on the Dynamite Circle ‘cause that’s the business that we still have. But the ideals are almost diametrically opposed like you said, so like, if you can envision me looking over the cubicle at Dan being like, “Dude, why aren’t you growing 120% like we are over here at the eCommerce business?” and he’s like, “Chill bro, this is all about community and kumbaya!”

And he’s right! And so, it took me awhile to kind of understand that this isn’t the same machine like an eCommerce business would be – it is more about the relationships and the personal interactions. And if I’m being honest about that business, you know, the reason that we started was pretty selfish. It was basically so we can hang out with like-minded people and friends and talk about business. It’s only kind of recently, I’d say in the last couple years, that we started charging people for the membership. And of course, you know, now there’s people in the community that I don’t know, ‘cause it’s grown to be about that size, but in the beginning, like I knew everybody, and we would go on vacations together and whatnot.

But yeah, now it’s gotten to the point where there’s people in there that I don’t know. So I guess, to answer your question, the biggest challenge I think for us in that community is keeping our eye on the ball in terms of what our core values are, and I’d say in terms of fulfilling what the members need, you know, members come into that community at different phases of their life and their business.

And a big thing that we have to work on is how do you keep them through whatever the next cycle in their life or their business is. So, to give you an example, I think it’s very common for someone to say like, “Hey, I just moved to Austin, I’d really like to meet like-minded entrepreneurs,” or, “I’m here for the summer.” And so they go to a couple meetups, they interact in the forum, everything’s cool, and then they kind of reach a new level in their life or their business, and you have to make sure, I think, that you can continue to track with them and the product continues to be useful to them.

Andrew: What’s the biggest thing you’ve found that’s most impactful for bringing the community together in terms of building that community and intimacy? Has it been in-person events for you, or something else?

Ian: Well, for me personally, I mean, that’s my favorite thing about the community, is the in-person events. I really get a lot of value out of that. But I think that one of the things that we hear from our members that’s very important is the mastermind groups, and so we basically help facilitate masterminds for our members. We’ll put them in a group, if they want to start a group they can start a group as well, and that’s been pretty profound for a lot of members I think is having those mastermind groups. You know, in terms of the forums – and I’d like to hear your take on this, too, Andrew, because you know, behind the scenes we kind of exchange information how to run these forums and bet policies and things like that.

I think the forums are really the most difficult aspect of this, for a bunch of different reasons. I think one of the different issues that we’re running into these days is just like moderation policies, you know? Just like having a strong opinion about the way things should go, because I think at times you can get some members that kind of go off the rails, you know, and so it’s like how do you deal with these people because they can really have an impact on the whole comity and kind of the whole community’s mindset, right? And so I think that you have to have good moderation policy.

And so, that’s one of the things we’re trying to work on lately, is trying to figure out, not just how to deal with rogue members, but how to create an environment that everyone understands the rules. Because when you have over a thousand members, you know, it gets difficult, you can’t just read a terms of service or something like that. You have to get your members to kind of embody the vibe of what’s going on. So how do you guys deal with that?

Andrew: Yeah, it’s probably one of the biggest, like you said, biggest things that we think a lot about and in some cases struggle with. So I think it’s — for us, the biggest rule we have in the community by far is just give as much as you get, because if everyone comes in and provides as much value as they ask for, then things work great. And I think what happens in a community, and in a forum especially when things break down, is you either 1. Have people come in that just aren’t a good fit personality-wise or culture-wise, and those are some of the hardest. It’s easy to spot, but it’s hard to explain, and sometimes it’s especially hard to explain to the person who’s in there. So those can be really difficult situations.

Ian: Do you just kick ‘em out?

Andrew: It depends on what’s going on. Usually you try to have a conversation and tell them why what they’re doing isn’t a good fit for the personality or the culture or the values of the community, and then, yeah, we’ve kicked out lots of people that either just, you know, ask without ceasing and never give anything back, or maybe they’re really snarky, you know for whatever reason is just not the kind of member we want in the community, we’ve definitely kicked out lots of people for those reasons.

Ian: Interesting. I’d love to kick some people out, tell me a little bit about the backlash of that.

Andrew: I think it depends on how you do it. I think you need to be transparent about it. On one hand, the last thing you want is to have these rumors running around that you’re this Stalinistic dictator who just runs your community with an iron fist, but I think the only thing worse than that is not having the backbone to remove the people that are definitely not a good fit, because everyone notices it, right.

So, the backlash often from the individual member is, a lot of times you get really, really upset members who are very upset with you. But I think that’s just part of maintaining the integrity of a community, and I think it varies for each member why they may or may not be a good fit, but unfortunately it’s part of the dirty, hard things about running a community.

Ian: Now, I’m gonna ask you some selfish questions because I want to know, on your podcast.

Andrew: Sure!

The Roles Inside the eCommerceFuel Forum

Ian: So you basically made a distinction between vendors and members and I think service providers, too, so tell me a little bit about the distinction between the groups and how they all interact.

Andrew: About a year ago, before then we had pretty much everybody in the community, anybody who was eCommerce related, either had a store that fit the guidelines or maybe even worked for a shopping cart or as a consultant with an agency and everyone could become a member. And we started running into a couple problems: on one side, people felt a little reluctant to chat about, let’s say, shopping cart X, when they knew that some of the team members, people who work for shopping cart X, were in the forum, so they felt like they couldn’t be candid.

And we also realized that a lot of times the incentives between some of the consultants and some of the storeowners were very different, and so we made the tough decision to really limit the community to just storeowners, so we stopped letting service providers in. We grandfathered everyone in that had been in, but we stopped letting new consultants in, and it sounds harsh but we booted out all the people that were a platform provider, people who work for a shopping cart or a major SAS app to make sure we had a very private environment where people could talk privately.

So it’s tough, I mean we lost a lot of great members, that weren’t causing any problems, and adding value, and a lot of people that were subscribers and we lost that revenue, but I think long-term it was in the best interests of the community which is why we did it.

Ian: I’ve just got a couple more questions here for you, Andrew.

Andrew: No, this is great! I could talk about this all day, we’re probably losing like two-thirds of the listeners, but that’s fine, I love chatting about it.

Ian: In terms of the service providers, do you charge them differently than the other members?

Andrew: We don’t. I mean, we could, but we haven’t traditionally. And especially since we’re bringing almost no new service providers in, we don’t, it’s just the same.

Ian: Okay.

Andrew: But you could make a very strong case that, hey, service providers that come in are probably willing to pay more because it could potentially be a source of leads if they’re able to do it tactfully.

Ian: Awesome.

Andrew: Yeah, and kind of going back to what you mentioned about removing members, one thing that we’ve kind of looked at recently is trying to come up with some quality guidelines behind the scenes on Laura and my side where we can point to to really get a sense of if people are just taking, taking, taking versus you know, giving in equal form and, that’s the other thing, is it’s a hard thing to measure and it’s a hard thing to track.

But we’ve kind of developed some internal quantitative metrics that help us be able to look at those things and identify people. And again, it sounds kind of Big Brother-esque, and it’s not something we apply to everybody, but more than anything it’s, if you notice anything at a gut-level where you say, “This member just doesn’t seem to be really getting the sense of the community and they’re asking for a lot more than they’re giving,” kind of metrics that we can use to look at to quantitatively say, well, is that the case, and be able to talk to them about that.

It’s tough, Ian, at the end of the day you’re dealing with people and relationships and having to have hard conversations, but I think ultimately it’s, to keep something strong, it’s something you’ve got to do but it’s not easy.

Ian: Yeah it’s very easy to say, oh let’s just have everybody interact as they would interact, well, people are – people can be s—-y to each other, and you have to have rules around that, you know? When you have a thousand people-plus in a group, it really behooves everybody I think to have rules, but yeah, setting these rules can feel so arbitrary, as you know. And trying to explain to people in the mass why you’re doing it, and on an individual level why you’re doing it. So it’s interesting to hear that you guys have, like, an internal process. So like, X member is a valuable member to the community because they fit this criteria is what I’m saying.

Andrew: Yeah, absolutely, and if there’s a member that’s not in line with your community metrics or your community philosophy and culture, being able to point to some specific things and say why not. I think at the end of the day, let people know what the expectations are, do it gently and graciously, but if it doesn’t work out, don’t be afraid to politely tell them it’s not a good fit.

Ian: We’re working on that part.

Upcoming Events for Dynamite Circle

Andrew: Yeah, it’s fine – just hire a hitman, I joke with Laura, I’m like, Laura you’re my hit woman.

What’s coming up for you guys over at the DC in the next year or two?

Ian: So, we’ve got an event coming up in Barcelona, and I think it’s pretty much filled up, which is pretty cool. So we try and do an event in Europe every year, and then we do our big bash in Bangkok in October. And so, those are kind of the two dates on my calendar that I look forward to. Looking forward to that, and also we are moving to a new platform, thanks to you which has been pretty exciting.

Andrew: Nice! And you’re going over to Vanilla Forms from Ning, right?

Ian: We’re going over to Vanilla Forms and we’ve been working with a developer, and that’s been quite the process to kind of get it to look the way that we want it to look, but man, in terms of like, functionality I think it’s gonna be great.  You know, we were on Ning and they haven’t updated Ning in like, ten years, and we’ve been kind of promising our members this for a long time. And I feel bad, but it was such a process to identify a platform that I think is going to be suitable to the community and to basically custom build a bunch of it to fit our needs. So we’ll be launching on that platform in the next week and a half, so our team is quite busy trying to figure out all that.

Andrew: Ah, I don’t envy you right now. I’m excited to see how it rolls out, and Vanilla’s been a good platform, it’ll be fun to see what you guys have done with it and see it live and good luck with the launch.

Ian: Thanks a lot man.

Andrew: If you haven’t heard of Ian and Dan’s community, again it’s the Dynamite Circle. I’ve been a member for a number of years. Great community, especially if, like Ian mentioned, you’re interested in travel, entrepreneurship, location independence, it’s just a gold mine of discussions and information on that, so You can read Ian’s blog and that podcast that he and Dan cohost over at Ian, it’s always a lot of fun catching up with you, and appreciate you taking the time, and once again congrats on the successful business, I know that takes a ton of time to pull off.

Ian: Absolutely man, I’m just looking for that “I’m retired” hat right now. I’ve just been going from Goodwill to Goodwill and I haven’t found it yet, so if you find one out there in Montana let me know please.

Andrew: Hey man, I’m always scrounging around the Goodwill so I’ll keep an eye out for you.

Ian: Thanks buddy.

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 a quarter million dollars in annual sales. You can learn more and apply for membership at Thanks so much to our podcast producer, Laura Serino, for all of her hard work in making this show possible. And to you for tuning in. Thank you for listening. That’ll do it for this week, but looking forward to seeing you again next Friday.

What Was Mentioned

Posted on: June 10th, 2016

Andrew is the founder of eCommerceFuel and has been building eCommerce businesses ever since gleefully leaving the corporate world in 2008.  Join him and 1,000 vetted 6 and 7-figure store owners inside the eCommerceFuel Community.

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