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Gr8 Morning folks!

The thing about being a entrepreneur - You develop a nose for opportunities that others walk past daily. Plot twist: While everyone's chasing the next shiny consumer app, I'm building something in the most unglamorous corner of FMCG. The kind of problem that makes retailers cry and procurement teams quit.

Today we acquired a FMCG business called RiceMandi

We also had talked with the founder of RiceDay.in, an equal competitor, way back in 2017. These are the stats presented from '19 research.., Here's some stats I wanted to share during our research…,

  • Estimated monthly visits for riceday.in -> 3k (Aug 2019)
  • Estimated monthly visits for ricemandi.com -> 6k (Aug 2019)

Here are keywords that these 2 websites organically ranks roc

  • 1. buy raw rice online (166, CPC=$0.72)
  • 2. brown rice in chennai (#7, CPC=$0.62)
  • 3. zeeba basmati rice online (45, CPC=So.00)
  • 4. brown rice price per kg in cbennai (#6, CPCs$0.00)
  • 5. anil kozbukattai flour offer (#9, CPC=80.00)
  • 6. jeera samba rice price (49, CPC=$0.00)
  • 7. patanjali sons masood rice (411, CPC= Moo)
  • 8. kutbiraivali price in tamilnadu (#5, CPCs$0.00)
  • 9. buy rice online bangalore (410, CPC=So.00)
    1. organic rice price in chennai (#7, CPC=80.00)

More details to follow…,

Why I bet on small business acquisitions (And Not VC!)

My friends know me by "he buys, sells companies"…, Technically, true - but there's something more to it than just trade, as I was an entreprenuer myself. Buying small business - Different game, has different rules!

Private Equity is entirely focussed on proven business, cash-flowing business. Not like putting money on a unproven idea and expecting a home-run! They seek to understand if the business provides value to the exisiting customers, and use leverage to acquire them.

Numbers don't (simply) lie!

Technically, the returns on venture capital -versus- private equity is like 1x:4x respectively, as the odds of the home-run in venture capital lending is prone to 65% failure!

Few years ago, I decided to buy small business. Big question - How am I going to do it? Many great investors have a potential SBA buyout strategy - They put down 10-20% of the total purchase price, which is calculated based on 3x-5x times actual earnings. This is leverage, and once done, you are in a position to buy the entire company outright, or put in a little bit of your own money to buy the stake.

Not every business is a good to buy! Usually, investors look out for the pointers like stable revenue, correct trends, and founder dilution. Watch out for key-function risk!

Keep reading, and don’t forget to subscribe our newsletter. Happy hustling!

Thanks for reading!