Ramon van Meer·August 16, 2022

Growing an Ecommerce Acquisition 13x in 4 Months

Ramon van Meer, a Dutch-born serial digital entrepreneur based in Austin, TX, bought Alpha Paw — a pet e-commerce company best known for dog ramps — in November 2018 for $325k plus inventory when it was generating $700k in annual revenue and ~$200k EBITDA. The sellers were two Australian founders who had built strong products but had messy financials, no paid marketing, no email marketing, and an outdated Magento website, which scared off other buyers and allowed Ramon to acquire it cheaply. Within the first year he grew revenue to $7M by launching Facebook and Instagram ads, migrating to Shopify, redesigning the site, and launching email marketing — a hockey-stick trajectory he had not anticipated. By the second year revenue reached $18M and the business eventually scaled to $35M in dog ramp sales alone. Ramon is a 12-year veteran of buying and selling digital businesses (content sites, dropship, SaaS) and had previously built a soap opera content site from scratch and sold it for close to $9M, but he sees himself primarily as a one-to-ten operator who buys businesses with clear improvement levers. The episode also covers his painful parallel acquisition of a YouTube channel (bought for $1M+ via SBA loan, declined 80%+ due to algorithm changes) and a SaaS to-do app (sold at a small profit), and his candid advice that e-commerce is operationally intense, emotionally volatile, and not suited for anyone who cannot handle supply chain risk, multi-vendor complexity, and a large team.

Deal facts

purchase price: $325k plus inventory
sde ebitda: EBITDA ~$200k
revenue: $700k at acquisition; grew to $7m year one, $18m year two
notes: Business was Alpha Paw, a pet e-commerce company (known for dog ramps). Sellers were two guys from Australia. Business had 3PLs in UK, Australia, and US. Financials were described as 'a little bit of a mess.' Guest also bought a YouTube channel for over $1m via SBA loan (doing $60k/month revenue at purchase, declined to ~$10k/month after algorithm changes) and a SaaS to-do app for ~$500k (sold later at a small profit).

Why this business

The website was old and had almost no paid marketing, so there was a lot of low-hanging fruit. As a marketer, he thought he could buy it and double, triple, or quadruple the revenue and then flip it. He saw at least three things he could improve: no paid advertising, no email marketing, and a poorly designed website on Magento. The idea was to optimize it over a relatively short time and flip it — not to build it into a long-term business.

What's working

Launching Facebook and Instagram paid advertising immediately took monthly revenue from $30k to $150k to $250k to $400k in successive months
Migrating the website from Magento to Shopify and improving product photography, copy, and design
Adding email capture via pop-ups and setting up Mailchimp email marketing to existing and new customers
Dog ramp niche turned out to be a much larger market than anticipated — eventually selling $35M in dog ramps
Business came with a package of assets: patents, manufacturing contracts, website domain, SEO traffic, a customer list, trademarks, a 2 million-like Facebook page, and Instagram following
Focused all profits on growth and building Alpha Paw into a large exit-ready business rather than treating it as a lifestyle business

What's hard

E-commerce has many moving pieces — manufacturing in China/Vietnam, freight, customs, trucking, 3PL, marketing, website, customer service — requiring a large and knowledgeable team
Supply chain was severely disrupted in 2021 with container ships stuck at ports, which was a very tough year
Facebook ad performance fluctuates week to week causing emotional and revenue volatility
Bought multiple unrelated businesses simultaneously (Alpha Paw, a YouTube channel, a SaaS app) with no synergy, requiring different skill sets and teams — he wishes he had focused on one
The YouTube channel he bought for over $1M via SBA loan declined from $60k/month to ~$10k/month due to algorithm changes, and now barely breaks even on the SBA loan payments
He regrets not taking a break after his soap opera exit to think through his next step strategically before deploying capital

Notable quotes

I bought it for 300 thousand dollars. At that time was doing seven hundred thousand dollars in revenue, close to two hundred thousand dollars in EBITDA. And I was able to buy it for fairly cheap especially considering the valuations now. I bought it for 325 plus inventory.

We went from seven hundred thousand dollars when I bought it, the first year we were able to do seven million dollars in revenue, the next year eighteen million dollars. It was growing so fast.

I didn't even know people used dog ramps when I saw this thing. I have a pitbull so I don't really — my dog doesn't need any furniture or help to get on sofa.

Most of my quote-unquote successes were not one billion dollar ideas at the time. It was not like oh this is going to be huge. No, there was like my successes were all like me thinking like oh this is a great business and I can maybe five-x my investment.