Deal Story: Selling During a Pandemic
When David Buxengard, the owner of A Cabin Place, decided to sell his e-commerce company, he never could have anticipated a global pandemic would impact the course of the deal. While strong businesses, particularly in the e-commerce sector, adapted quickly and continued to thrive, potential buyers got nervous and deal making became trickier. Luckily, the team at Calhoun Companies has experience guiding businesses through all manner of crises from global pandemics to economic depressions to world wars. The key is simple – strong businesses will always be in demand.
David Buxengard founded A Cabin Place from scratch more than 20 years ago. The e-commerce business sells cabin-related furniture and décor, popular products in a state with 120,000 cabins. After two decades of work, Buxengard decided to sell his business in order to focus his time on volunteering, but he had a few concerns. First, he wanted to ensure his business was left in good hands and was sold to someone who wouldn’t require much training post-transaction. Second, he needed to work with a broker who understood the complexities of e-commerce and could communicate those complexities with potential buyers.
“Not many companies are familiar with the processes of selling an e-commerce business,” says Buxengard. “Calhoun Companies was instrumental in gathering the right information and making a proper presentation to potential buyers.”
Little did he know that presentation would become even more important than ever just a few months after listing his business. Buxengard and Calhoun Companies were deep into the sales process when the pandemic and accompanying shut downs hit. A prospective buyer that was in the due diligence phase got frightened by the pandemic and made an offer below asking price, despite the fact that business actually improved for A Cabin Place and demand for e-commerce companies increased.
Calhoun Companies ultimately recommended rejecting that offer in order to find a buyer who could recognize the upside of buying an e-commerce business. An experienced industry buyer ultimately stepped forward to make an offer, which was quickly accepted.
Calhoun Companies agent, Manoj Moorjani, says, “E-commerce businesses continue to perform well and draw a lot of buyer activity, even during the pandemic. We saw this first hand with A Cabin Place. The business started to take off after the listing was signed. With financials in order and inventory included, the business was hitting the market at a prime time and demonstrating its value.”
A Cabin Place turned out to be the perfect business to sell during a pandemic that asked people to remain indoors. Ultimately, the buyer was able to purchase a thriving, crises-proof business, and the seller was able to walk away knowing his business was in good hands.