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A saying goes, “In every ending, there is always a new beginning”. In this episode of The Exit hosted by Steve McGarry, Kellianne Fedio, the co-founder of the Amazing Exits, talks about how long it takes for a business to get ready for an exit from Amazon.
From being a lawyer, Fedio transitioned to selling her e-commerce with high revenue of seven figures. Amidst this fast-paced economy lies the best time to sell an Amazon business, but gaining a high profit can be challenging for amateurs. Listen to her story as she entailes about how she honed herself with six years of experience as an Amazon seller that helped other entrepreneurs as well.
There’s No Place I’d Rather Be
Even though Kellianne Fedio had never imagined herself before as an Amazon entrepreneur, she still could not see herself doing other jobs, although she started as a lawyer. However, being an attorney made it hard for Fedio to focus on her responsibilities as a mother and a wife. It was hard for her to juggle work and family matters, so she decided to take some time off. After a few years, Fedio realized her desire to start her business as she wanted to be in-charge of her destiny and have time and freedom for herself and her family. After looking for different business models after some trial and error, Fedio stumbled into the e-commerce industry, upgraded her brand, and launched it on the Amazon platform in 2014.
From being an attorney to being a mom and finally being an entrepreneur, Fedio undoubtedly went through ups and downs, but the catch doesn’t end there. After successfully launching her brand on Amazon and gaining quite a lot of profit from it, Fedio decided to have an ‘amazing exit’ by selling her company for seven figures.
How to Exit Amazingly
While operating and selling her Amazon business for seven figures in February of this year, Fedio knew that she wanted to help other sellers have an ‘amazing exit’ from Amazon. With the current coronavirus pandemic and the emergence of online convenience, there also lies the creation and high demand for Amazon-based businesses and other e-commerce markets. Acquirers have come to see Amazon businesses’ potential, but sellers seem to have a hard time finding a matching buyer for them.
Fedio saw the need for education and consulting for these Amazon sellers as the information available is fragmented and insufficient to gain higher revenues. After having an agreement with another seven-figure Amazon seller, Paul Miller, Fedio made the unforeseen happen, thus, the beginning of ‘Amazing Exits’ through a podcast, adding to her endeavors. Although the podcast launched recently in September this year, it has already gained a lot of attention, ranging from small business sellers to experts.
The Power of Word of Mouth
Surprisingly, the podcast has been going well, although Fedio and Miller haven’t gone through many content episodes to market it. The secret behind the success is the ‘word of mouth’ and organic growth from the interests of entrepreneurs and entrepreneurs-to-be. It was a shocker for Fedio that Amazon sellers were also craving reliable information in making their assets viable and sellable, along with exit planning and strategies to sell their business at the highest amount.
Proactive Exit Planning Mindset
It is still a wild guess for many how Fedio managed to woo buyers to purchase a business at a seven-figure cost amidst the sea of other Amazon sellers. Selling a business is not just an instant process as it requires intensive planning to avoid risk factors, like fraud, and gain higher profits. Deciding to sell a hard-earned business is already a tear-jerker, so every seller deserves better compensation for the work that they have allotted to it. Preparing to sell a business needs a clear roadmap and options stocks to make a business sellable.
Being proactive and having an exit planning mindset is one of the key traits that every seller must possess to sell their businesses. Sellers must keep in mind that their business is an ‘asset’, bearing a sustainable, transferrable, and predictable cash flow stream. Although a seller can produce a seven-figure revenue to his/her bank account, there is still a need to define the type and characteristic of the cash flow that a business possesses. Determining the worth of the cash flow can also determine how much a company is worth. Fedio also entailed that no matter how eager a business owner not to sell his/her business, there will still come a time where they need to sell it, but most sellers fail to know the bottom line worth of their companies.
What’s Next After the Exit
As the podcast “Amazing Exit” made a terrific start in just a few months, Fedio still wanted to reach more people and entrepreneurs and help them with their businesses. Rather than hoping for more listeners to gain profits, Fedio prefers to share and impart knowledge to a larger scale and guide them to avoid missing out on higher returns upon selling their companies. Fedio affirmed that they could provide a higher value to a business than what its owner knew through their experiences. With the advice of some of the biggest business acquirers that Fedio confided to, her team aims to create more opportunities for owners to find the right buyer for their businesses.
Exiting a business may seem to be the end of everything but to Fedio, there is more to see beyond handing over that business. With proper techniques and strategies, selling a business can become more meaningful and worthy not just in monetary terms but also with its sentimental value. Fedio still has vague plans about other matters for the podcast, as she was just enjoying the ride and joy of hearing other people’s stories and gaining insights from many people worldwide while disseminating what she knew already. The podcast gives more than technical information and a handful of entrepreneurial life advice that even non-business owners can also use.
PODCAST TRANSCRIPT
Steve McGarry:
Hello and welcome to The Exit presented by Flippa. This is a 30 minute podcast featuring amazing entrepreneurs who have been there and they have done it. On The Exit, we talk to amazing operators who have bought and sold businesses of all different types, and you’ll learn how they did it, why they did it, and get exposure into the world of exits. It’s a world occupied by a very small few, but accessible to many. Now, if you have not listened to the previous episode featuring Eric Bandholz, you definitely have to check that one out. He created Beardbrand, an amazing company featured on Shark Tank and it’s worth checking out. On this episode, I sit down with Kellianne Fedio and she is a co-founder of Amazing Exits. She sold a seven figure Amazon FBA business, an incredible entrepreneur.
She goes through her new business, Amazing Exits. They have a podcast it’s phenomenal, I’ve listened to it. They interview some incredible people on there as well. She goes through the different aspects of coaching people who are preparing for an exit, she talks about what it takes to get a business ready to exit from Amazon and e-commerce. She talks about some of the exciting things around e-commerce and the passion there is something that’s really admirable. I definitely encourage you guys to listen to The End for some amazing knowledge nuggets here from Kellianne. Without further ado, let’s dive into my interview with Kellianne from Amazing Exits. All right. I am here with Kellianne Fedio, The co-founder of Amazing Exits. How you doing today, Kellianne?
Kellianne Fedio:
I’m doing great, Steve. How about yourself?
Steve McGarry:
I’m doing fantastic. I’m doing fantastic. I’m excited to have you on the show just because I’ve been following Amazing Exits a little bit, and I’m excited that you yourself launched a podcast and really excited to dive into the whole concept. Before we get into Amazing Exits, let’s talk about your origin story. What brought you into this space and what brought you in to start Amazing Exits?
Kellianne Fedio:
Sure. Well, I never would have imagined starting out after college and law school and practicing law that I’d be doing what I’m doing now, but every day I still wake up and pinch myself and there’s no place I’d rather be, there’s no industry I’d rather be than in Amazon and e-commerce. It’s probably one of the, if not the biggest opportunity, certainly of my lifetime, but of past generations. I’m just very grateful to have found it and just to be part of the Amazon seller community and be able to help folks and also just learn from others. It’s just awesome. Like I said, I started out as an attorney. I’m still an attorney. I just don’t practice anymore. I practiced law for about 10 years as a litigator, and then decided that I wanted to pursue just being a mom and a wife for a while.
It was a really hard career to juggle and to also raise a family. I took some time off and then after a few years decided that I wanted to start a business. I had no clue what I wanted to do. I just knew that I wanted to be in charge of my own destiny, and I wanted to have time freedom and do something where my business served my lifestyle. I started looking around at different business models and knew I wanted to do something online and stumbled into e-commerce that way after a lot of trial and error and a lot of different other online types of business models and found e-commerce and then got started with creating a brand and launching my first product on the Amazon platform in 2014.
Steve McGarry:
Nice. Very nice. I like that transition from litigator to mom to entrepreneur. That’s a great transition. Tell us a little bit about what Amazing Exits is, because I think that that is a good, there’s a couple different components to it. I’d love to start with what it is from a high level, and then we can talk about each part of it.
Kellianne Fedio:
Sure. After I launched my brand on Amazon, I built that company up to seven figures and I ended up selling it and the sale closed in February of this year, 2020. I knew during that process of selling my business and operating it, that I wanted to help other sellers with their exits. Right now, we’re living in a time where there’s huge demand for Amazon based businesses, e-commerce businesses as well. Just a few short years ago, Amazon based businesses, there wasn’t even a marketplace for them. Now, we know that there are so many acquirers that have come onto the scene and are looking to purchase Amazon based businesses. I knew that there was a need for education and consulting out there. I didn’t feel like a lot of the information that was out there, at least when I was looking, was very cohesive, it was very fragmented.
I knew that I wanted to start something. Then I teamed up with my good friend, Paul Miller, who is also a successful seven figure Amazon seller. We decided, why don’t we do this together? Because he’s planning for his exit in a year or two. Why don’t we start a podcast and get our content out that way? I’d never done a podcast before, so that was all exciting and new. Now I can add podcaster to my list of professional endeavors. We launched the podcast in September of this year, 2020, and it’s been going really well. We haven’t done a ton to market it. It’s just been a lot of word of mouth organic growth.
We’ve had a lot of interest and that was really our goal and our intent to kind of put this out there into the universe and see do people care about this topic? Do Amazon sellers care about doing what it takes to build a valuable asset and a sellable asset at that? Do they need help with exit planning and creating an exit strategy so that they can sell their business for what’s probably going to be their biggest payday? We’re finding out that indeed people do want that information. We’re really happy that we started it.
Steve McGarry:
Yeah, that’s a great segue actually. You built your business, you exited it and now you’re kind of creating content around how to get ready for exits. Let’s dive into that a little bit. For the people that are listening, what does that process from an Amazon sellers perspective, when you’re trying to, let’s say, make it bright and shiny and you put a bow on it for the acquirer, what does that look like? What process is that? You put together your PNL, for somebody that’s a beginner that, let’s say they have an Amazon business or an e-commerce business that they want to exit. Could you break that down for us a little bit and tell us how you did it in terms of on a silver platter to the acquirer?
Kellianne Fedio:
Sure. I’ll have to take just one step back and really focus on something that we focus on in our podcast and when we speak publicly, is that planning for an exit requires just that. It requires planning. You don’t wake up one day and just decide “I’m going to sell my business.” Because you have to be taking action steps along the way and have a clear roadmap of all the things you need to do to prepare your business for sale, to not only make it sellable, but also to be able to sell it for maximum value. That takes a proactive mindset. That’s the first thing that we really try to get into the minds of our audience is that you need to be proactive and have an exit planning mindset, that this is an asset you’re building at the end of the day. It’s an asset that if somebody is going to come along and purchase it, they’re purchasing a stream of cashflow. That really is the most important thing that you can show sustainable transferable and predictable cashflow.
So many Amazon and e-commerce sellers, at least the ones that I came up with starting back in 2014, everything was all about the top line. What are you doing in top line? “Oh, I’m a seven figure seller.” I even said to myself today, right? Those are the vanity metrics that we all like to spew out, but what are you actually putting into your bank account year over year after running this business? What kind of cash flow is that business spitting out? In order to do that, you need to be very proactive and running a real business. Having solid bookkeeping, keeping financials, doing budgets and forecasts, knowing your numbers at all times, knowing what the value of your, potentially your biggest asset is at all times.
I mean most of us know how much our house that we live in is worth. Right? We can see what it’s worth. We can look at different websites and find that out. How do we know what our business is worth? How do we know if we got an out of the blue offer, what would be a reasonable range for our business? Those are the types of things that sellers need to be thinking about, even if they decide that they never want to sell their business, and I would say never is a very long time, because at some point you’re going to exit your business. You’re either going to die or you’re going to sell it. Right? You should always be knowing what that bottom line value is, because that’s what, in most cases, is going to determine what your business is actually worth in the marketplace.
Steve McGarry:
Yeah. I love that you talked about the top line kind of vanity metric. Because I’ve encountered a lot of kind of younger entrepreneurs over the past like two-three years getting into Shopify and e-commerce and things like that. They’re like, “Yeah, I’m doing $3, $4, or $5 million and I was like, “Okay, what’s your net profit? Like, what’s your take home?” They say profit margins of 2% and 5% because they’re spending everything on Facebook ads and things like that. That’s when I take a step back and I’m like, “Okay, well, you need to really drill down those numbers and figure out what your take home is.” I like that you’re really emphasizing that it’s important to have a proactive mindset. You don’t just wake up and then say like, “All right, today, I’m going to sell my business without any measures taken.”
Hey guys, Steve here taking a quick pause from the interview. I know that selling a business, it can feel unattainable and just out of reach for everybody. It’s definitely something that is very reachable for people that are listening to this podcast with Flippa. I’ve mentioned that this show is presented by Flippa. They have over 3 million users on their platform who are looking to acquire everything from content sites to e-commerce stores to SAS platforms or even mobile applications. If you’re curious and want to know more about what your business is worth, head to Flippa.com/Theexit for free valuations on your business. It takes a couple minutes to literally go through and you can just go through the whole process without committing to anything at all. Once again, Flippa.com/Theexit, check it out, get a valuation on your business without any commitments and just see exactly what your valuation of your business is worth. Let’s dive into the interview.
Kellianne Fedio:
Absolutely. To your point, there are a lot of seven and even eight figure sellers that don’t know what their bottom line truly is. They don’t, and it’s crazy. It’s so easy to say what that top line number is. Don’t get me wrong. Top line is very important because that shows proof of concept. It shows traction in the marketplace. If you can generate a million dollars worth of sales, you’re onto something, right? I would say that’s kind of a good benchmark that once you reach that million dollars in sales, then you really need to focus on the more boring stuff like operations and inventory management and cashflow management. You want to make sure that you have very healthy cashflow coming out of your business.
Steve McGarry:
Yeah. Moving on to the next part of the business. You guys have done a great job. You created the podcast, you’re teaching people with this digital course. What is the freedom score? That was the first thing that I saw on your site. I talked to Blake, the CEO of Flippa about it. I was really excited that you guys are working on that, just because it piques people’s interests. Just the word freedom score, I think is a really fun term. Talk to us about that. What is it?
Kellianne Fedio:
Well, thank you so much. Paul and I really put a lot of thought into that and we put a lot of thought into the name and excuse me, because my printer’s going off right now back here. Let me just wait for that to finish. I don’t know if you can edit this out, but somebody in my household, I’ve got kids they’re homeschooling. They’re printing things out when mom’s on a podcast. Okay. That’s done. Paul and I really thought long and hard about what we could offer a value completely complimentary to folks when they arrived at our website. We had a bunch of different names, but we knew that whatever it was, we wanted to be able to capture information and be able to tell somebody, “Okay, this is kind of where you’re at in terms of having a valuable and sellable business.”
We have a very thorough and thoughtful but easy to take questionnaire. You can answer those questions and you’re going to get back a score. It’s going to give you recommendations of where you’re at in terms of your getting ready to exit journey. Then, of course, we have things that can help you in that journey. We offer a complimentary call after taking the assessment. For right now, we’re doing that. That won’t be forever, but for right now you get Paul and I both on a 20 minute call to be able to go over your freedom score assessment and to really try to hone in on the needle moving activities that the business owner should be focusing on to be increasing the value of their business and make it sellable.
Then, of course, we have our digital course, which was not created by us. It was created by a very good friend named Ryan Tansom and it’s called the intentional growth course. That really lays the foundation for everything you need to do to prepare a business for exit. It’s not Amazon or e-commerce specific, it’s industry agnostic, but it was the most comprehensive course that we ever came across about exit planning. We partnered with him to be able to offer that to our audience. We’re really thrilled to be able to do that. Then Paul and I just love getting on calls and coaching and consulting and helping develop people with their strategic roadmaps for planning their exit. Then, also making their appropriate referrals to all the experts they’re going to need along the way, whether they need an expert Amazon brand agency or PPC management, maybe they need listing optimization. All the things you need to do, all the levers need to pull to get your business ready for sale and to sell it.
Steve McGarry:
Yeah. I both respect and love that you guys are doing that, because I think that, I get hundreds of DMs on social media every couple of weeks now about selling businesses, buying businesses, things like that. Mentorship is something that I always emphasize as very, very important for younger people that are starting businesses and any age when you’re starting a business, going through the trenches with somebody that’s done it that isn’t completely financially incentivized to do anything that is other than help you, a friend or family member that’s actually exited a business is just so valuable to have by your side. It’s really great that you guys are emphasizing that, that it’s almost like this coaching element to helping people exit.
Kellianne Fedio:
Yeah. We’re really trying to serve what we saw as a void in the marketplace, buying and selling Amazon and e-commerce businesses. I mean, you have your brokers, you have your investment banking firms, you have your broker listing websites, but there’s a lot of other experts you need on your team to exit your business. You need a good M and A attorney. You need a good accountant. You need a good bookkeeper. You need a good tax advisor. You need a good wealth manager. Then, not to mention all the different professionals you need to optimize your business so that it can be transferable. You need to have your supply chain and inventory management in place. You need to have business operations in place. You need to have SOPs. All these things that are so overwhelming. We want to serve as an advocate to sellers to help connect them to the right resources. We’ve done all the vetting. We’ve done all the curating and have a Rolodex of the best in class service providers for all these things that we can refer you to, and then also provide you with mentorship and coaching along the way.
Steve McGarry:
Excellent. Excellent. Just with current events, where they’re at, I really wanted to touch on this just because I think it’s a very pressing time. I believe that you mentioned it before, building these as assets and having a business as an asset, you’re building it over time and whether you’re exiting it through death or through another company, you will exit at some point and with things the way that they are in the current state, have you guys seen, let’s say, some brick and mortar people going to Amazon selling, have you seen a surge in people coming to you guys and asking questions about their businesses and things like that? Because I would assume that everything’s moving online, big brands are being bought and moved on to e-commerce. I think that you guys are positioned at a really unique place. Have you seen a distinct change this year compared to previously?
Kellianne Fedio:
Absolutely. The marketplace for the buying and selling of Amazon and e-commerce businesses has just completely skyrocketed and sellers are really starting to become more and more aware that even if they’re just a one channel brand, that it has value and it’s sellable. There are players out there that are fully funded with big money behind them, big private equity money that want to purchase these brands. That along with, I can’t quote specific statistics, but we’ve all heard that COVID has accelerated the growth of e-commerce by probably at least three to five years. E-commerce is still only a very small percentage of overall commerce, but we know what’s happening in the world. We know that everybody’s going online and these are going to be permanent habits that they’re adopting.
One stat I’ve been meaning to look up is just how many new Amazon Prime memberships have emerged since COVID hit and how that increased from last year. I can only imagine that there’s probably people that never before thought that they were going to do online shopping and now are Amazon shoppers. They do their grocery shopping online and everything else. These behaviors are being adopted by people of all ages and backgrounds and Amazon itself being, so much of its growth is built on the third party sellers that come to their platform and sell on the platform. I think the latest stat, they don’t share it specifically, but it’s about $400 billion in sales of products were done this last year. It’s just a crazy, crazy time. If you are building an e-commerce or just Amazon only based brand, and you were doing it with intention and growing it intentionally, and making sure that it is profitable, you will have a very big asset on your hands, which is super, super exciting.
Steve McGarry:
Yeah. Yeah. Amazon is definitely crushing it in terms of their growth. I mean, every time I see a delivery van passing by our house, whether it’s a FedEx or UPS, the back is just stacked full of Amazon packages, which is crazy to me that they have fleets here in Tampa where I’m based and they’re still kind of overflowing into these other third parties from what I can tell, which is just, yeah, it’s wild to watch. Well, with that being said, what’s next for you guys? You guys rolled out the podcast, you have this course, you have the freedom score where you’re getting people to come in and they’re inquiring with you and you’re in the right position at the right time. What’s next for you guys? What’s 2021 look like?
Kellianne Fedio:
Well, we’re definitely hoping to just get the word out more about our podcast and about how we help sellers. A lot of that, we’re doing just by getting on other great podcasts like yours, and just sharing the message. We really want to be considered kind of the preeminent resource out there for sellers when it comes to looking to sell their businesses. That hope we can provide value there. We definitely think we can.
I, myself, personally, am really itching to start at least one new brand. Most likely with my teenage daughters are very much want to start their own businesses. I’ll be helping them launch some new brands. I’m also doing some consulting for one of the biggest and most well-funded acquirers out there in the space. I have a unique visibility into what they’re looking for when it comes to purchasing Amazon businesses. I can provide a lot of insight there to sellers as far as what they need to do to make their business sellable and get the most value out of it than they can when they go to sell. Then, from there, what I love most about having a podcast is we get to learn and connect with so many different people and learn from them. I’m just enjoying the ride and see that just continuing to flourish in 2021 and beyond.
Steve McGarry:
Yeah, yeah. Got to love podcasts, just sitting there, listening to experts and people talk about everything that they’ve done-
Kellianne Fedio:
And share stories, right?
Steve McGarry:
Yeah.
Kellianne Fedio:
I love to hear people’s stories and we all have such diverse backgrounds, but we’re all in this industry. It’s so interesting to see where everybody’s come from and their perspective.
Steve McGarry:
Yeah. That’s a fantastic segue into our premier question that we always ask guest, is knowing what you know now, what would you tell Kellianne 10 years ago?
Kellianne Fedio:
Oh my goodness. I would have told myself get started now because 10 years from now I hadn’t gotten started in e-commerce and now it’s so funny I have such blinders on, and it’s hard for me to imagine why would anybody on the planet want to be in any industry other than e-commerce? That’s where it’s at. I wish I had started sooner, but they always say when’s the best time to start? Five years ago. When’s the second best time? Now. I got started a few years ago, six years ago to be exact. I look back on that time as being super valuable and educational, I’ve learned a lot and now I’m excited to just take that knowledge and, and move forward and continue to use those skills to grow new businesses and help others. I definitely wish I had gotten started sooner. For those people that are out there that are new, or just getting started in e-commerce, you definitely are in the right place and you definitely can make it happen. Go for it.
Steve McGarry:
Well said, well said. Well, that’s all the questions I have for you. The last piece here is kind of roll out the red carpet. Where can people find out more about what you’re working on?
Kellianne Fedio:
Great. Well, they can go to our website, which is Amazingexits.com. Don’t forget to take your freedom score assessment while you’re there. We would love it if your listeners would consider subscribing to our podcast and after they listen to some episodes of leaving us a rating or review, we always appreciate that. Then, if anybody wants to connect with me personally, they can reach me either on LinkedIn or on Facebook.
Steve McGarry:
Perfect. Perfect. Well, once again, thank you so much for coming on the show. If you guys are listening on SoundCloud, Spotify or iTunes, definitely check the show notes for all the links that Kellianne just mentioned. Once again, thank you so much for coming on the show, Kellianne.
Kellianne Fedio:
Thank you so much, Steve. It’s been a pleasure.
