What Makes Brands Attractive to Investors?

Chris Shipferling of GW Partners joins Mike to discuss the capital market for eCommerce brands in 2024. What makes a "great company?" When should brands look to sell? What do buyers look for in a brand? In tight capital markets, it may not be possible to sell your brand. But building a brand that's attractive to buyers is the same as building a profitable brand. Chris kicked off the conversation by sharing a personal anecdote about house-sitting for his dad and taking care of a family turtle named Bill. This light-hearted start transitioned into a deep dive into what GW Partners does and how they assist businesses in preparing for a sale. GW Partners specializes in lower middle market M&A, focusing on consumer products. They work closely with brand owners, often years in advance, to optimize their businesses for a future sale. Chris emphasized the importance of having a strategic plan to move a company from its current state to an ideal selling point. A significant part of our discussion revolved around what makes a company great and attractive to buyers. Chris outlined several criteria, including having a real brand that resonates with consumers, innovative products, and a solid product development strategy. He also touched on the importance of profitability, customer lifetime value, and the ability to scale. Chris shared insights into who buys brands, explaining the landscape of private equity, family offices, and corporate strategic desks. He also gave us a glimpse into the current M&A market, advising that now may not be the best time to sell due to market sensitivity and the expectation of capital being more expensive. In terms of marketing, Chris stressed the importance of knowing your numbers and having a budget that aligns with growth goals. He highlighted the need for efficient top-of-funnel expansion beyond just Google and Meta platforms. To wrap up, Chris offered advice for those considering selling their business, suggesting that waiting until after the election year might yield better opportunities for a sale. For anyone interested in learning more about preparing their business for sale or just looking for some expert advice, Chris invites you to reach out through the GW Partners website at www.gw.partners.