Hey, thanks for tuning in to another Partner Interview at EcomBalance. At EcomBalance, we’re all about creating win-win partnerships where we are able to grow with other companies in the eCommerce space.
In this exclusive interview, we interview Ignacio Villanueva from Boopos Partner.
We hope that you enjoy the interview and that it brings value to you as an eCommerce business owner.
Connor: Hey Ignacio, thanks for taking the time to chat with us here. We love getting to know our partners better so that our community can benefit from what our partners are offering and doing in the industry. To get started, can you give us a high level overview of Boopos and how it got started?
Ignacio: Boopos has a mission of helping people become business owners and reach economic freedom. We finance up to 80% of the purchase price for online assets with no personal guarantees or dilution.
Boopos started in 2021 after we realized how hard it was to get funding for a high demanded assets like online e-commerce. We wanted to give buyers the opportunity to follow the LBO strategy that private equity firms have been using for many years and allow buyers to leverage their capital to have more buying power.
Connor: That’s awesome! Can you dive a bit more into the financial services that you offer? I’m sure our audience would love to know exactly what problems you could solve for them.
Ignacio: Up to now, there were three main sources for buying online assets:
- Upfront cash: The problem with paying all cash is that not everybody has $500K sitting around in the bank as they might have other investments and cash is tied up. Even if you do have $500K, online assets can be risky if you don´t understand the space so much. Putting all this capital at risk for buying an online assets can be scary for many buyers looking to spend this amount of capital. Finally, putting only cash for an acquisition, may tie up your capital in case you want to continue buying deals or having working capital.
- SBA: We all know that SBA may have the best terms in the market. However, not everybody feels comfortable putting personal guarantees when buying online deals. In addition to this, the process for SBA is quite long and it may take up to 90 days in the best cases. A high speed market like the online space, time is key and having the SBA as a partner may not be the best option when looking for good deals.
- Private equity: This option may not be available for all buyers, as you need a lot of experience managing with investors in order to raise equity to purchase deals. Even if you are experience and you manage to close a round of equity, you will still have to give away a percentage of the company and dilute yourself. This can become a problem in the future if you are trying to sell the brand or if you want to bring in other investors.
Finally, Boopos can offer the benefits of the three alternatives above mentioned. No need to put personal guarantees, giving away control of the business and having the ability to let a third party take most of the risk. Boopos offers financing in 7 days with no dilution or personal guarantees. Many of our buyers ar using our financing to create a portfolio of brands and increase their ROI in the future.
Connor: Jumping off of that…if there was one problem you’d say that Boopos solves best for your clients, what would it be? Why?
Ignacio: The combination of buying a business in less than 7 days, with no personal guarantees, no dilution and while having the ability to leverage your capital for future needs.
If time is Key, then cash is King. If you are able to partner with someone that will enable you to save time while having cash, you put yourself in a good position for success.
Connor: As the company continues to grow over the next year, what are your plans for expansion? Any new products or offerings or enhancements to your current products?
Ignacio: We are currently working on a Fixed Term loan model where buyer will only pay interest the first year and amortization of the loan will not start until the second year. This enables buyers to reinvest in the business during the first year and thus increase the chances of growing.
Apart from this, we are validating a new tool that will help buyers make better assessments on the deals. Sharing with our buyers our analysis on the brands, we hope to give more insights about the business and help buyers understand the metrics and what to look for when buying a deal.
Connor: And how specifically would you say that Boopos and your team is different from other similar businesses in the industry?
Ignacio: The good thing about Boopos is that for the moment, there are not any other lenders in the acquisition space for online assets. Is tru that there are other revenue-based companies in the market but they are all focusing on working capital.
Our biggest competitors would be cash only or SBA. We have already explained the benefits of using cash or SBA vs. Boopos but in a nutshell, we are able to provide with analysis and take off the risk from the buyer.
Connor: What made you decide to get involved in the financial service space? What’s your starting eCommerce story? From what we’ve found, a lot of business owners financial services have fun stories of how they first started…
Ignacio: My story is not different from any other random stories out there. I was a Olympic Rugby player until 2016 where I attended the Rio Olympics. After that, I retired from sports and started working on a corporate job. I wanted to get in the Fintech space as I thought it could be a good place to be in the future. After a 1 year job at a Fintech company, the opportunity came to be of Joining Boopos since day one. Not a lot of decision was needed to get on board of this great project.
Connor: Love it! Talking more about the eCommerce industry, where do you see it going in the next 1-2 years? Any unique predictions that you could share?
Ignacio: It seems like we are definitely on the right market and going on the right direction. We just went through a market correction after the good period we had during covid. I am most certain that the ecommerce industry will continue to grow in the next few years.
The main concern on my end is the ability of the individual sellers and buyers to keep up with the bigger Aggregators and their experience. As market grows, this will attract more and more institutional investors and individual buyers will have a harder time finding good deals and paying a fair price on them.
Chat GPT just appeared on our lives and I am thrilled to see how this will impact our online purchase habits.
Connor: Giving you an open mic for a minute, what is something you’d want the EcomBalance audience to hear?
Ignacio: I guess I would love to share stories with them on the different buyers we have worked with and the interesting ways of structuring deals without having to put so much capital at risk.
If you actually have good idea on how to manage an online deal, there is no reason why you shouldnt be diving into the option of buying a brand. Having the ability to estructure deals with seller notes, earnouts and external debt, really enables you to buy a company with very little cash.
Let´s say you have 1M to invest in a brand. You could either go out and bur a 1M dollar business, or you could structure a buying thesis with 30.3% cash, 30.3% seller note and 30.3% debt. With this in mind, you could acquire up to three 1M dolar deals instead of the initial one brand you thought about buying. After 4 to 5 years, once the debt is paid off, the ROI of selling three businesses will be so much bigger than selling just one. Thats how you create wealth by leveraging your capital and other´s people money.
Connor: Changing gears a little bit…When it comes to bookkeeping and accounting, what do you think the biggest pain points for business owners are? Feel free to speak from personal experience as well.
Ignacio: I think first of all I think people tend to do things themselves in order to save money but end up doing many things poorly rather than just focus on what they are good at and really brings them value.
Outsourcing services that you are not an expert on will only give you an advantage that will enable you to grow faster. Even if you have to pay money for it, at the end of the day it wil all be worth it if you find a good partner
Connor: As we close this out, I just have one more question. Where is the best place to find and follow you and the company online? Also, if you have one, is there any special offer that you’ll be offering to the community today?
Ignacio: The best place is go to Boopos.com and qualify as a buyer. From there, you will get access to all our pre-approved business and also upload deals yourself.
You can definitely reach out to me directly at [email protected]