15 Apr 5 Tips for E-commerce Sellers from a Serial Entrepreneur
Yardline CEO Ari Horowitz was recently invited to be a guest on GETIDA’s PrimeTalk, a podcast focusing on e-commerce and entrepreneurship. From taring driveways to becoming a CEO, Ari has been an entrepreneur at his core — it’s a “bug” that’s been engrained in him throughout his entire life.
With host Yoni Mazor, COO & Co-founder of GETIDA, Ari dives into his entrepreneurial journey and the lessons learned from raising capital, acquiring and selling businesses, and , the ultimate entrepreneurial dream – an IPO.
Here are a few tips that Ari highlights during the podcast episode:
1. Timing is more important than having the perfect idea.
Being early is the same as being wrong – even with the best business plan.
Early in his career, Ari experienced this firsthand. As the co-founder of Freeagent.com, a site dedicated to helping people quit their jobs and pursue freelance dreams, he saw that the modern workplace would evolve into what we now know as the gig economy. A great idea that, in the late 90s, was just too early and before its time due to a number of infrastructure factors. Seeing the recent success of Elance and Fiverr was a reminder that timing is everything.
Today, we are seeing a transformation in how people work with e-commerce. Ari’s advice is that entrepreneurs should strike while the iron is hot. There hasn’t been an easier time to start a business, especially now that sellers can start selling across literally hundreds of platforms or marketplaces.
2. Identify the processes that spur growth in your business and replicate them.
The success stories that we hear about most often are those of a founder with a million-dollar idea that went big. However, the winners in e-commerce are often those who understand how to create consistent revenue growth, regardless of the product they are selling.
Increased availability of capital and the growth of the aggregator space have created an opportunity for e-commerce entrepreneurs to consistently launch, scale, and sell high growth businesses. Mastering how to develop and market products will allow you to scale (and sell) successful companies again and again.
3. Understand how and when to tap into capital.
An infusion of capital can be extremely helpful when scaling a business. However, it is important to choose a form of capital that suits your business model and growth phase.
Sellers who are already seeing consistent revenue growth may find success with an increase in capital when their goals include:
– Increasing product exposure through advertising
– Preparing for a seasonal rush by ordering additional inventory
– Developing or launching new product lines
Unfortunately, traditional lenders are still largely in the dark about how to underwrite capital for e-commerce. That is because e-commerce businesses have very different metrics than traditional brick-and-mortar operations. However, the emergence of revenue-based financing, known as growth capital, has given e-commerce sellers an alternative financing option that more closely aligns with their sales cycles. Unlike traditional banks, growth capital providers look at marketplace revenues and projections when determining how much capital to offer. Additionally, repayment is aligned with a seller’s growth as a fixed percentage of revenue.
4. Finding the right partners is critical.
It is impossible to be an expert at everything. That is why it is critical for entrepreneurs to find great partners who have the knowledge and expertise to support their e-commerce dreams. Partners with specialized expertise, like GETIDA, and those who can provide guidance and support, like Yardline, allow entrepreneurs to gain massive amounts of insight while simultaneously keeping headcount low.
5. Your network is one of your most valuable assets and it will often serve you in unexpected ways.
Over the course of his career, Ari has made some very serendipitous connections and it was through these connections that one of his greatest ventures began. By leveraging your network, you may find business partners, co-founders, or even your next entrepreneurial venture. Always keep an open mind and an ear to the ground.
Ari’s parting advice: Don’t wait on your e-commerce dreams. Go out there and do it. When you find the right business, grow it. If the opportunity arises, sell it. Then repeat your success.