Buy, Scale, Succeed Online | Jaryd Krause

[EP] - Jaryd Krause

[00:00:00]

Matt Edmundson: Hello and welcome to the eCommerce Podcast with me, your host, Matt Edmundson. Now this is a show all about helping you deliver eCommerce well. And to help us do just that today, I am chatting with Jaryd Kraus from buyingonlinebusinesses. com and probably what is the most exotic location we've talked to anybody.

on this show and if the clue is not in Uh, the, uh, the web domain buyingonlinebusinesses. com, we're going to be talking about buying online businesses. That's what we're getting into today. So, uh, we're going to talk about buying and selling and all that sort of stuff. Uh, but before we get into that, uh, a warm welcome to you.

If this is your first time with us here on the eCommerce podcast, great to have new [00:01:00] listeners every week. Uh, I just encourage you to subscribe to the show wherever you get your podcasts from. And of course, if you haven't done so already. Head over to ecommercepodcast. net, enter your email address and we'll send to you every week, the notes and the links from the shows direct to your inbox.

So you get all the show notes straight away. So it's a beautiful thing. Uh, so just head over to ecommercepodcast. net to do that. Now let's talk about Jaryd. He invested his way out of his plumbing job, quitting in 2015 and now owns multiple online businesses. He helps others buy profitable online businesses, enabling them to spend their time doing what they love, with who they love.

Now, Jaryd has scaled businesses from six to eight figures, saving and making people millions of dollars online. I, I, maybe we'll get into the secrets that he's got on that. And his buying online businesses podcast. This is the number two passive [00:02:00] income podcast online, so do check that out if this topic does interest you.

It's a great podcast and not just because I've been on it, because it is just genuinely a great podcast. Uh, but Jaryd, welcome to the show, man. Great to have you on this one. How are we doing?

Jaryd Krause: Thank you so much for having me. Wow. What an intro. Really appreciate it. I'm doing really good. How are you, Matt?

Matt Edmundson: Yeah. Slightly envious of your location. So let's get that out of the way. Whereabouts in the world are you right now?

Jaryd Krause: Uh, I'm on a little island in Indonesia called Sumbawa.

Matt Edmundson: Sumbawa? Never heard of it. Um, that maybe shows my ignorance.

Jaryd Krause: There's, I mean, it's not, it's not a popular tourist destination. I mean, in Indonesia, I live in Indonesia and Bali, but this is not a popular tourist destination.

It's, it's known by surfers and a lot of surfers do come here. Uh, and I'm just on a bit of a strike mission. So we're chasing a swell, which has been the last two days. And, [00:03:00] um, yeah, just Surfing our brains out and doing a little bit of work in between. I have another friend who is a marketer, a digital marketer here with me.

And yeah, we've been hunting waves for a while and yeah, in a new location this time.

Matt Edmundson: Well, I'm not going to lie, slightly envious. I love this because before we hit the record button, you said to me, I'm on a surf mission. I'm like, what is a surf mission? And this is where Well, I'm intrigued. It feels like it's something out of, um, Point Break, you know, the movie, the original one with Keanu Reeves and Patrick Swayze.

It feels like, you know, which, which character are you out of that movie doing these sort of, uh, mission, uh, surf missions?

Jaryd Krause: I'd love to say I'm Keanu, but I mean, I don't know, I probably won't take all the glory. I'm not that, I'm not that good of a surfer. I've been doing it for a long time and I should be better than I am.

Matt Edmundson: No fair play. And [00:04:00] it's interesting, isn't it? I mean, there's a separate, there's a side here, I suppose, with the businesses that you do, with doing online business, it means that actually you can jump on a plane. You can go surf around the world where the storms and stuff come in. And. Yeah. Yeah. And you can do that, you can pursue that with your friends, because you actually have the freedom to do that, I suppose, with your business, would that be fair?

Jaryd Krause: Yeah, absolutely. That's exactly why I got started, right? Like you said in the intro, I was a plumber, and I wanted to work out how I could travel around the world and surf. So that's how I, you know, I transitioned, is literally Googling how to travel the world and make money online. And then that's where I got this thing started, so I could, yeah, continue this lifestyle.

Matt Edmundson: So when you Googled that, how did, what came up?

Jaryd Krause: Uh, basically travel blogging, right? I that's travel, blogging, photography, travel photography, those sorts of things. And I, I bought a camera a couple of months prior to that, and I thought, okay, cool. I'll get, [00:05:00] and I was getting into my photography, so I thought, all right, let's turn this into a, into a blog.

And that was unsuccessful. ,

Matt Edmundson: no surprise there, but yeah. Okay. Yeah. And then I,

Jaryd Krause: yeah, well, I knew nothing about SEO, and then I decided, all right, cool. I'm going to start an eCommerce business. That's where the money's made, right? eCommerce. So I started an eCommerce business, dropshipping business, selling travel products to piggy off.

Back off what I'd been doing with the travel blogging and that traffic that I'd gained. And I sold maybe like a handful of products and didn't make much money at all. Uh, and then I realized, Oh wait, I don't know about SEO and I don't know what digital marketing is or paid marketing is. So I had to learn both of those skills and then, um, I started to make some traction.

Matt Edmundson: So how long was it then before you, between quitting your job as a plumber, uh, until you actually started to make a livable income? from your online business? What was that time period? [00:06:00]

Jaryd Krause: Well, it didn't work out that way in terms of linearly, uh, I was working on replacing my income before I left my plumbing job.

Right. So, uh, yeah, so I, I think I started, My, I did in 2013 is when I first started my first online business, my travel blog. And then in 2015 is when I quit my, my job. Um, but I'd done a lot, a lot of things in the meantime, I had bought two businesses in that time. I'd started two and then I'd bought two businesses in that timeframe and the two businesses that I acquired, I stopped the two ones that I started and the two businesses I acquired had started earning me more money than my plumbing job, which allowed me to quit at the end of 2015.

And then, then I, you know, continued my travel. I went, I went and served Central and South America for a year and a half and, um, bought another business. And then people were like, dude, you need to teach me this stuff. Like what's going on? So that's where I started the buyingonlinebusiness. com thing, helping [00:07:00] people do the same.

Matt Edmundson: So the, uh, this is fascinating because I, I hear All the time people wanting to sell eCom businesses, right? So, um, everybody has got this thing in their head. They want to exit. They want to build their business. They want to exit. Usually when I talk to, uh, eCommerce entrepreneurs about it, um, because we acquire eCom business.

One of the things that we do, I don't know, we've talked about that, but, um, Yeah. I don't know if you hear the same thing as I do. Everybody wants at least a million and they're going to exit in two to three years time. Although the old million, it used to be a million. It's more like 5 million. Now everybody wants to exit for 5 million.

It's that kind of sweet spot, right?

Jaryd Krause: Yeah, people like even Eight figures, you know, eight figures, like the let's get an eight figure get exit. Is a, is a pretty, yeah, pretty. Uh, high up there. One now as well. Yeah. Funny. It was that easy.

Matt Edmundson: Um, but the, um, , yeah, but I'm intrigued because actually you got, so you started your own businesses, but actually quite quickly it sounds like you were [00:08:00] acquired to.

Businesses, um, which is, is not the usual market. Most of the people you, uh, not the usual market, not the usual route. Most of the time I hear stories of people who are startups, right? So we, we saw a problem. We started our eCommerce business. We got the thing growing and here we are, and it's turning over, you know, X amount of dollars or pounds or whatever.

But you actually started out by, or you started your own, but quite quickly you acquired some business. Um, and this was. Pre 2015, right? It sounds like. So this is going back a few years. I'm curious as to why you did that because it was not common practice. What made you acquire an online business?

Jaryd Krause: Well, I started these two, right, and I didn't know anything.

It was really hard to get traffic and revenue. They're the two biggest problems, I guess, when you're starting a business, normal business. Uh, and I found it super, super hard. Yeah, they're just [00:09:00] slightly important. And so, I was struggling with this and then as I was working as a plumber, I came across a stat.

And that statistic was that 90 percent of all startups fail, and I thought to myself, hang on, like, if, if 90 percent of these things fail, and I've started two, I've got another eight that I need to start for one to be successful, do I have the stomach for that? And then I thought to myself, well, let's, let's see if I could buy, I'm sure I could just run one of these, like, I'm not, I was confident in myself that I could run one.

And so I thought, let me see if I can just, If I can run one, then I can maybe save up some money and buy one. And then I went onto Google and see if you could acquire these online businesses back in, I bought my first one in 2014 and you could, there is a marketplace, flipper. com. Uh, it's probably the longest standing one around and.

Uh, I didn't know anything about acquiring, so I had to teach myself how to, and there was nobody really teaching this stuff, so I had to teach myself how to acquire the online business and do the due diligence and all that sort of stuff, and [00:10:00] yeah, and that's, that's sort of why I, and then I bought the first one and it worked out well, so I was like, well, okay, let's rinse and repeat this method, and yeah, that's sort of how it happened.

Matt Edmundson: So the business, can I ask what was the business you acquired?

Jaryd Krause: Absolutely, the first business I acquired was a database of wholesalers and suppliers that people that were starting dropshipping businesses could tap into to find suppliers and wholesalers for the products they wanted to sell and it was just a membership.

Matt Edmundson: Simple as, how long had the website been up and running at that point, when you bought it?

Jaryd Krause: Honestly, I can't recall. Uh, it was a number of years. It was a person out of Sydney. It was an Indian person out of Sydney that started it. And they had, the reason I wanted to buy is because they already had people on these monthly memberships and annual, quarterly and annual memberships.

And I thought, well, you You know, paying this money into this PayPal account every month and you know, they're members and [00:11:00] the database works and they're signing up. So let's buy this thing.

Matt Edmundson: Why would you not? I mean, this was, this was even before memberships were cool, right? It's just like, this is quite far

before it was cool, right?

Memberships became cool. Like maybe four years ago, five years ago. Yeah.

Matt Edmundson: Yeah. Absolutely. And then here you are buying. Buying a sort of pre-run into this, which I think is quite extraordinary. So can I ask, do you remember what you paid for the business or was it a, a unique deal that you'd sort of put together?

Jaryd Krause: Yeah, I paid 15,000 for it. Um, yeah, that was the FI had some money in the stock market that I wasn't doing so well in stock market with, and that I'd saved for plumbing. And then I then. Yeah, acquired this and then worked my way up to larger acquisitions from there.

Matt Edmundson: Very good. So it's what I like to call squeaky bum time, isn't it?

Where you just take, uh, some of that money and, and put it into something like that. Um, how did you, how did you value the business then? Was it, you put [00:12:00] your 15 grand in, you obviously thought it was worth 15 grand.

Jaryd Krause: Yeah. I mean, I was looking at like a year multiple, And I thought, can I, you know, what's the risk, you know, what's the risk of these people not, me not making my 15 grand back in a year when you've already got members subscribed.

Um, and yeah, so how I value the business then is very differently to how I would value a business now based on how much I know about due diligence and I guess the thousands of deals we've looked at, but it was pretty scrappy at the start, I'll tell you.

Matt Edmundson: Yeah, no doubt, no doubt. So how would you, Uh, and this is one of the questions that people just love to ask when it comes to selling a business.

How would you, how do I value my eCommerce business? So what are some of the things that I need to think about?

Jaryd Krause: That's a great question to your audience. Some of the things you need to think about is, uh, I mean, [00:13:00] the market really, the market is what sets the price and you kind of need to look at what sort of niche or industry your business is in, what sort of products it is and look at where the market has been and what sort of has sold.

Around that price range and it can be difficult if you're not, if you're not in the acquisition market and you don't know what these are selling for, you'd want to be going to speak to brokers. I'm not completely a broker, solely a broker, but you want to be speaking to people to and looking at the market and different marketplaces or online brokers to sort of see what is listed to sale at with the type of product you have in the space or industry that you're in.

And I can help you get a bit of a multiple. And then. You also need to think about risk. So you need to see how much risk your business carries for a new owner. So you need to put yourself in the shoes of somebody that's going to acquire is how much risk are they going to be [00:14:00] taking on? And what is that level of risk compared to other businesses that are on the market for sale as well, which if the business typically has less risk, it's going to go for a high multiple, it's going to be a more attractive acquisition for a buyer.

They're the things, they're the key things I would say you really need to think about is, is the, is the market and the person that's going to purchase it and how do you, Yeah, how do you value it based on that?

Matt Edmundson: Yeah, that's a really good point because I, I, I, I'm speaking to, um, and it's probably worth saying actually, dear listener, if you're listening to the show and think, what's Matt talking about?

One of my companies is We Acquire Online Businesses, um, we have a set strategy, uh, if you're interested in that, I'm more than happy to talk to you, but we have, uh, several conversations going on at any one point in time. Right. And some of the deals that I'm looking at at the moment, [00:15:00] the ones I want, I'm just thinking of the ones that I don't really want to get involved with are the ones where if I was to verbalize why, which I don't, I don't know if I have, but you sort of get this gut feel, don't you?

Sometimes, um, a lot of that comes down to risk, like how much risk is involved for me to take this on. And it's, and the risk is never normally around eCom because I'm fairly confident. I know the stuff, do you know what I mean? It's more, um, the risk in the relationships, in the continued supply of that product, or in the, actually this product is not unique and people from all over the place can start selling that.

Um, they're the kind of risk factors that I start to think about that make me sort of walk away. Does that make sense?

Jaryd Krause: Yeah. So there is multiple, depending on the type of business, say it was an eCommerce business or something else, it's, if you can reduce those risks in terms of single source dependency on a supplier, a single [00:16:00] source dependency on traffic, revenue, product, and so on. Uh, and then also, you know, key person dependency, um, relations, key, key relationship dependency.

How can you, if you're trying, say if your goal is to exit your eCommerce business and you want to get a higher, higher price, which is probably most people listening, is how can you remove most of that risk and set yourself a good timeframe to be able to do so? Which we talked about in the podcast when you came on my podcast, Matt, is, is talking about what.

You know, what can we do to set people up and how much time may it take to get to a point where you, you know, are able to make the exit and understand how much time it might take as well.

Matt Edmundson: Yeah. Yeah. Cause it's never a quick thing. Uh, this is what I think when I sold my first eCommerce business, I'm going back to 2000.

Oh, when was it 2002? I mean, you're going back a few years, Jaryd, you know, showing my age a little bit when I saw my [00:17:00] first don. Just 22.

I

Matt Edmundson: was just 22. No, but it's cool because you're in the

game longer than everybody else, you know. Yeah, yeah, yeah,

Matt Edmundson: yeah. You're 12 years old, yeah. I was just 12 years old at the time, saw my first eCombusiness.

Eight figure eggs

at 12 years old.

Matt Edmundson: It's finally there, oh geez, uh, The Child Prodigy, um, so yeah, so in 2002 we, I, I bought and sold, well I didn't buy, I set up and sold my first eCommerce business within six months, so we set it up, um, We bought tanning products, these kind of products that you, you know, you wear on a tanning bed.

Um, we sold those online and then one of the suppliers of the tanning products, uh, bought that business out. They're like, well, this online thing seems interesting. And this was obviously very early eCommerce. It was the easiest sale in the world that I've ever done, Jaryd. I'm not going to lie. It was an absolute dude.

It was so easy, right? Because it was like, [00:18:00] can I buy it? I'm like, yeah, what'd you want to pay for it? And he's like, how about this? And I went, Alright, next day the money's in my account, here's the password, how about it, right? It was amazing, no due diligence, no nothing, I mean they could, I mean they did due diligence in the sense that they saw how much I was selling because I was buying from them, right?

Um, yeah,

Jaryd Krause: yeah.

Matt Edmundson: So that was super easy and in my naivety I just thought every sale was going to be like that going forward. Ha, ha, ha.

Jaryd Krause: I've got a friend who has a, uh, he was just visiting in Bali and, uh, he has an eCommerce business selling red light therapy lights and, uh, he's getting bought out by his supplier as well. And it's such a smart move for manufacturers to acquire their sales channels. Like, I mean, why wouldn't you? Do that sort of, you know, merge and acquisition and roll up in that in that fashion, you know, it's the way to go.

Matt Edmundson: Yeah, it is because it gives you, I mean, it gives you access to the direct [00:19:00] consumer, doesn't it? There was one company that we had, uh, it was a beauty brand, right, it was a beauty website called Jersey Beauty Company. And, uh, One, one sort of horror story on this, I suppose, was we had a supplier, um, you know, talk about risk.

A lot of our business came from one supplier and that supplier, a skincare provider, changed in 2012, um, sent me a letter saying, we're changing our terms and conditions of supply. Uh, bearing in mind, we'd done 6 million revenue the year before. Um, so it wasn't an insignificant amount of their product we were selling.

80 percent of those sales were probably attributed to their brand. Um, and they sent me a letter in 2012 saying, we're changing our terms and conditions of supply. Basically, the more you buy, the more you pay. Uh, which I appreciate sounds really odd, but what it did was it forced us to have to put our prices up overnight.[00:20:00]

Um, I can't say it was price fixing, cause I don't want to get sued, but, It's a very grey area. Let's just put it that way, right? Um, so our prices went up and inevitably what happened was because our prices We couldn't discount the manufacturer of the supply of the product started to sell the products online themselves.

And they started to not discount the price, but they gave gifts with purchase, which we couldn't compete with. Do you see what I mean? And over a period of like five years, they sort of took most of the market back into them. Now it's not entirely true that they've got all, I mean, there are still other people selling their products, but, um, this is one of those risks that we're talking about really, that actually We were so connected to that one supplier that anybody, but, and we almost sold the business when it was at its height.

There was an e com group here in the UK that was sniffing around, um, and I think they weren't, they were a little bit scared because we were so dependent on that one supplier. And you can see why, because [00:21:00] it did come and bite us in the ass, you know.

Jaryd Krause: I remember you sharing more of that story on, on my podcast as well.

And, um, it's super common that, that. When people acquiring that business will look at what risk is involved with that supplier and also look into the relationship and the goodwill within that relationship as well. Uh, and, and it's as things evolve and change for you, you know, you there's, there's, there's pros and cons to each, you know, you know, having, you know, One, one relationship, one person makes business and that sort of better.

And if you can sell it to them, it'd be silly for them to not acquire it. But if you go down the other route of, uh, I've got multiple suppliers and you go, Oh, I want to sell it. And who's, who's, you know, in this circle, the network that I could sell it to easily, you've got a bunch of different suppliers that.

You may need to go to then and they're like, Oh, well, how do we, [00:22:00] you know, how do we don't manufacture this product? It'd be a bit of a risk for us to do that. So yeah, it's, it's an interesting, it's an interesting game and we, they're the best lessons, right, Matt? Like thinking, I think people should go and listen to the podcast that we, we, where we spoke about it more in depth that, um, you know, hearing a story around that in hindsight, they're the lessons that we learned that make us better business owners and entrepreneurs that help us.

Get larger exits in the long run.

Matt Edmundson: Yeah, we'll, we'll put a link to that episode in the show notes. Do check it out. We do talk about it a bit more. You're right. Um, so how can I, I mean, we talked about mitigating risks. So, you know, single source problems, key person, how do I, How do I actually start to mitigate some of these things?

What have you seen people do that has sort of been creative or worked well that have you know, mitigated risk and add value?

Jaryd Krause: Is really the first, the first philosophy would [00:23:00] be thinking about who you're selling the business to. And how do you make it an absolute no brainer for them where they have very minimal risk? So that's the sort of philosophy and the lens that you need to look through. And so for somebody that has a, you've, I mean, it's, it's removing single source dependency like we mentioned, but also with sales as well, like say Facebook, What happens if your Facebook account gets shut down, you know, for X amount of days or Amazon is so common with Amazon.

I had a client that was doing like 20 mil a year in Amazon sales and, you know, it was going to be, if he was going to sell it and he was going to sell this to his manufacturer, uh, would they would be looking at how many days and how much time is the business down and off Amazon to deduct that from the, You know, deduct that from the [00:24:00] business, you know, it's 25 grand a day and sales gone and it was a two days where the listing is taken down, it's 50 grand off the price, um, you know, if you're doing a one year multiple or a hundred grand, if you're doing a two year multiple, so it's working out like, all right, cool, how do we ship some of those sales to other channels, uh, and not be so reliant on one single, one single source of, of traffic and revenue.

Matt Edmundson: Yeah. Yeah, it's such a powerful point. One of the companies I spoke to recently, 98 percent of their sales were on Amazon. Um, and I know that there are companies out there that love the app, you know, the Amazon aggregators that love those kind of things. Uh, but for me who I'm a little bit more, you know, traditional eCommerce, I like to see sales going through your website.

I like to see an email list that you own. Um, you know, they're valuable assets in a lot of ways and I kind of think Um, if it's that reliant on another company, I spoke to, you know, big Amazon, big Etsy. So they're splitting it, but they're still reliant [00:25:00] on third party sellers. Makes me really nervous. And I appreciate that's just me, but it does make me nervous.

Jaryd Krause: What's super attractive for a buyer? Like if I'm going to acquire an eCommerce business, if I can find an eCommerce business where 70 percent of the traffic and the revenue. Comes from organic from say, Google.

Mm-Hmm. .

Jaryd Krause: That is huge, right? Yeah, it's

massive.

Jaryd Krause: Yeah. It, it's, it's harder, I mean, it's far harder to build that than to jump on Amazon or Facebook and just shove money at a product to market it.

versus. All the longer term strategy of keywords, good contents, building that over, out over many years, that's a way that you can decrease your risk and get a higher multiple if you're looking, you know, if you're looking eCommerce businesses is play the longer game. Yeah. And I appreciate that, you know, the longer game, there's more.

There's a lot of bumps you hit along the road [00:26:00] and challenges, but delayed gratification is one of the most beautiful things, I

believe.

Jaryd Krause: And the compounding effect of, of what can come from the, you know, the work that you do and the results in the future if you're really going for a great exit.

Matt Edmundson: Yeah, that's really powerful.

I like that. I think, what are some of them, what are some of the other markers that you like? So if you're buying an eCommerce business, because this I think will help people if they're thinking of selling, like how do I design this business in such a way that makes it more sellable? So you, what are the markers are you looking at?

So 70 percent organic traffic is, is a beautiful thing. What are some of the other sort of tails that you have where you kind of go, okay, I mean, I'm, I'm, I'm going to look a little bit more here.

Jaryd Krause: Yeah, I just want to frame this that for what I'm looking for may be different to somebody else. Uh, but let's, I'll try to keep a general, uh, if you're doing a strategic acquisition, you might be looking for a specific, uh, a product or a specific marketing channel that has [00:27:00] been tapped out, but you might know that, all right, they've done Facebook marketing really well, but they haven't really done Google.

Well, or they're tried and they failed, but I'm a, you know, say I'm a genius at Google Ads, I'd be looking at something like that. So understand what your skills are or not the, maybe not just the skills that you have, but skills that people that you know and trust and you'd be willing to pay, that you can bring them on board and, and grow the business in that way.

I'd be looking for. Growth opportunities in that way. So first things first is like the risk is how do I, like we've, we've basically talked about the risk. You'd be looking at obviously organic traffic, um, great email list and some channels that are untapped and then working out, you know, what skills can you bring in that will help grow the business?

Uh, I, I like, I also like to see eCommerce businesses that I just maybe have like two or three products that I like. They know they're good products and they're selling them [00:28:00] mostly and then, you know, what's worked for me in the past helping somebody grow an eCom business is building out their, you know, customer lifetime value or average order value, depending on what you want to call it.

Uh, average order value for like one, like one time purchases and customer lifetime value for future, future purchases. Another cool thing is that, you know, is there room to add upsells and downsells? Is there room to turn this into a bit of a membership business or have a membership product run alongside with, you know, the product that we, we are selling, um, top three best sellers room like that to move there.

They're attractive for sure. Especially if you can do your competitive research and you see that there's a business with a similar type of product already doing that in your space and just go, great. We can just look at that strategy and not do the exact same strategy. We don't copy, we mimic and we make it better.

And, uh, yeah, those are the, those are the cool things I'd be looking for.

Matt Edmundson: That's really interesting what you're [00:29:00] saying here, Jaryd, and I love how you preface this by saying this is what I look for, it's not what everyone looks for, because everyone's different. And, uh, just going back to something you mentioned earlier.

You know, and I, there is a lot of strength and wisdom, I think, in figuring out the type of person that's going to buy your business and talking to them about what it would take to sell the business. Now, you might not be ready to sell it now, you might be going, I'm going to exit this in three years, um, but understanding who it is that's going to buy it in three years and then going to them and saying, what are you looking for?

Right. What do you need from me to make this a no brainer deal at some point in the future? And when I get close to that, I'll give you a ring and see if you're still interested. That's not a guarantee. They may have changed the rules in the next few years, but actually when, when it comes to selling a business to not just assume that actually, if I've got, you know, this much turnover and this much profit, everything's going to be okay, but you can, you can do that, but you [00:30:00] can position your business in such a way that it's a bit more valuable even with the same turnover and same profits because you've had those conversations, right?

Jaryd Krause: Yeah, absolutely. You're kind of, you're thinking with the end in mind, uh, which if you have thought or like learnt anything about personal development, then that's a really good strategy is thinking with the end in mind. It's not, you know, it's not rocket science, but sometimes we get so caught in the weeds, Matt, of like, I need to make this Facebook ad work and this email marketing system work when we can sometimes like take a step back and go, Oh, like, hang on, what's, you know, what are the questions I should be asking myself?

You know, the quality of the questions determine the quality of your life. The quality of questions you ask about your business can determine the quality of your business and that can determine the quality of the business towards somebody that you're actually wanting to sell it to. So, asking those questions, uh, it's so critical.

There's a really, [00:31:00] um, a smart guy. His name's Keith Cunningham and he built, uh, He's very smart entrepreneur, but he's a great real estate investor as well. And he built a lot of wealth and then lost a lot of wealth and then built that wealth back up. And he wrote a book called The Road Less Stupid, uh, by Keith Cunningham.

And it's, Hey, what he prescribes in the book is like, I guess I'll give you the quick, quick bit of it is like, take time out of your day or your work schedule and schedule in your calendar and call it thinking time. And then just think about your business and just write down all the questions. Now if you're trying to exit and you're trying to, you know, the type of company that's going to acquire that.

Say, for example, somebody is building a video content platform that. Shares great long form videos, and they're gonna make money from people publishing on that. Mm-Hmm, , right? And they're gonna [00:32:00] put ads on it and people are gonna start, and it's basically like a small YouTube competitor. Mm-Hmm. . You'd wanna sit in the shoes and the eyes and the lens of the people that run YouTube and go, what?

You know, what do they. You know, how do I build this business where they go, where it gets to a point where it's so big and they go, we can't not acquire this. They're taking up too much market share and we need to, we need to either acquire it and merge it in or acquire it and do something with it,

Matt Edmundson: you know?

Yeah. That's very true. Very, very good. I, I love the title of the book, The Road Less Stupid or, yeah, that's a great title. That tickled me. Um, but I, I should definitely, definitely read that. Uh, on my way to sub summit this year as I fly out in a couple of weeks. No, I fly out next week actually. Um, but yeah, I think, um, I think you're right.

The value in that and what I've noticed here is, uh, Jaryd, and I don't know if you've noticed this. Actually, if I get involved in a company, usually my strategy, I acquire a [00:33:00] smaller percentage because I'm not after any more operational roles in my company. I'm not going to lie. I just don't need them. Um, and so, but we take a, what I've noticed is, Because of that, we come in almost like a partner and the, the, the person running the business or the couple running the business or the family running the business or whoever's running that business get caught up in the weeds.

Um, they don't know where to take it to the next level. This is another common thing that I see. They don't know how to get that next stage of growth. So they need some help. And the, the founders and the owners are so busy. That actually just saying, put thinking time in the diary is almost like slapping them across the face with a wet fish.

It's like, don't you know what my life is like, you know? And so what I've, what I've noticed is actually when we get involved in businesses, we actually create that space to do that thinking. You know, we think with them. We actually, One of the things that we do, I suppose, is we take them aside and say, no, no, it is time to think.

Let's [00:34:00] ask some questions and let's have some conversation. And it, it seems to be that's a lot of the value that we bring in many ways, you know.

Jaryd Krause: That's, that's amazing. That's a really, it's such a gift. You know, I don't think people appreciate or have gratitude towards, you know, somebody helping them develop

www. aurionmedia. com I'm this, the reason I talk about this book, the Road Less Stupid is 'cause I actually had that happen to me in my business, is I had a business partner and I was just like hustle mode. Like I just thought I needed, I needed to work harder. And the harder I worked, the more money I was gonna make.

And that's, you know, the, what I was indoctrinated into from the content that I was consuming at the time.

Mm.

Jaryd Krause: And I had a business partner was like, hang on. Let's just [00:35:00] stop and let's just work out what are the top two, three, two, two, three things that you do in business that are going to get you, that are getting you the results.

Yeah.

Jaryd Krause: And then, you know, and so we, he was becoming a business partner and every week or every two weeks we would have a call and he'd start asking me these sorts of questions and then, you know, prescribe some homework or have a think about like, how does this, how does this work for you? Um, you know, If we're going to do this, make this change, what would it look like for you if you're going to make this change and go away and think about it over the week?

That's your one task. Don't do, don't do the work just, you know, and embedded and integrated me into me to do that. And I think it's an amazing thing that you get to do that with your clients as well is because they're the, You know, they're the ones that understand the business the best and coming in with a fresh lens and a fresh set of eyes and a fresh set of questions helps them to start to see things differently that they may have never seen before.

That is, could be one little small [00:36:00] unlock that equals a massive change.

Matt Edmundson: Yeah. Yeah. It's interesting actually because we, uh, you know, if I put my consulting coaching hat on, you go into a business, you have conversations, you commit with a strategy and a plan where You know, there is this growth involved, but nine times out of 10, what I've noticed is, and the same with online courses, right?

People will do an online course, they'll get the learning, the information, they will get a coach and or a consultant if they've got the money, they get some learning, they get some information out of it. But if you go back to that same company six months later, It's like they've forgotten almost everything because the default of the day to day grind, the routine, has sort of taken over again and it's always after the course, after the consultation, after the coaching, it's always, oh, I'll get round to that, uh, when I, this is, I just need to sort this out, I'll just, and before you know it, six months, twelve years have gone past and you've completely forgotten about that, that whole thing.

How do we stop ourselves doing that? You know, it's a really intriguing, uh, problem that I [00:37:00] see quite often and I, I'd love to know how to stop it.

Jaryd Krause: Ah, I mean, I think reflection is like, that could be the answer that we've already got is, is, you know, in the book, The Road Less Stupid is, is coming back and thinking about rather than just doing, doing, doing, doing, doing, doing.

It's funny that, um, I have this philosophy that I called inside out growth because. With Inside Out Growth is people will look to look outwards to work out what are the strategies I need to do in

my business, and Typically, that can be listening to a podcast or YouTube video or an influencer or doing a course or whatever it is and saying that this business or that person got this sort of result. I need to take, bring that out from the outside into my business and use that marketing strategy or use this tactic.

However, I think the inside out growth method is better because if you learn to listen to your business and learn to [00:38:00] tune into your business, it will tell you things and it will show you things of like, this is working really well, uh, this is not working so well. What should I do? Oh, okay. Let's lean into what's working really well and drop a little bit of what's not working so well.

And we can grow the business without us having to bring things from the external to the int and make them internal when it could just cause a complete mess. I had a client come to me once that was like, Jaryd, I've, I've done, 35 marketing courses or something ridiculous because the owner of the business, he was, he was like the CMO, right?

The owner of the business was like fractional CMO, the owner of the business bought me all these courses and wanted to do like this email marketing campaign and then run these types of ads and do these sorts of things and the business isn't growing and I said to him, yeah, man, like. You're trying to do all these things and you're doing them, everybody's had this before, you're doing all these things and doing none of them well.

And plus that's coming from the outside. What if you stopped and [00:39:00] said, you know, where's most of the, where's most of the revenue come from? He'd never asked himself that. Uh, okay. And you know, all right. So it's from these few products. Okay. Which of those few products is the better one? Okay. It's from this number one product.

Okay, cool. So what if we did an order bump and an upsell and we increased the average order value and then we only just ran marketing campaign to that one? And we forgot everything else. How do you think the business would go? And he's like, Oh my God, that would be smart. I was like, yeah, I mean, it's not, it's not rocket science.

It's just, I just have a different lens and you're caught in the stuff. You know, it's, um, yeah, it's, it's, it's interesting though. I think we get indoctrinated with so much content out there and us comparing ourselves to other businesses and other people that we need to bring this stuff in for us to be successful when we can actually have far more fulfilling our business if we just slow the heck down.

Matt Edmundson: Yeah, that's so powerful, man. So powerful. And like, I love this idea of listening to your business and figuring out what makes sense for your business, the inside [00:40:00] out approach, because you're right. I think the, the desire to find the latest silver bullet in eCommerce is unbelievable. I mean, everybody you speak to, there's got to be something.

Should I do TikTok shop? What's the next thing? Maybe you should, I don't know. But it's like, it's like you're constantly looking for the next silver bullet. Um, and I, I don't know. I think digital marketing for me is still 95 percent old school principals and doing them well. You know, it's, um, it's, it's, it's, it's, it's got to be right.

I, maybe I'm just a bit old fashioned because, you know, I was 12 when I started my

first business. Yeah,

Jaryd Krause: I'm with

you though, like it's, it's,

Jaryd Krause: you know, what works on TikTok, the reason it works is because of old school marketing tactics and principles and philosophies that, you know, have been used forever, you know, talk about headlines, right?

What's, you know, what's going to work, what's, you know, what's gets the most [00:41:00] views on Tiktok or Instagram reels or whatever it is. It's like the headline buys you in and then like the capture, maybe like the, the quick shot capture or the thumbnail, it, it draws your attention. What do they do in newspapers all this time ago?

The headline, that's what got you into the story. It's like, it's old school stuff that people think, Oh no, it's, it's, it's Tiktok that's going to get me the results. It's not Tiktok. It's like learn the basic principles from great marketers, you know, like Frank Kern and like people even before Frank Kern's mentors, you know, like these guys, Gary Halbert, like one of the greatest copywriters of all time, you know, these guys are the one, I'm not a copywriter, but I've learned some of this stuff from these guys.

It doesn't just apply to business, it applies to all areas of life, it's like sales, sales and marketing is life, you know, like we're always killing ourself anyway.

Matt Edmundson: Yeah, no, it's very true, very true. I still maintain, you know, when I go into an eCommerce business and look at it, whether to get involved, whether to cope, whatever it is, or [00:42:00] even my own businesses, my own business.

I'm obsessed with three metrics, right? Number of customers, average order value and average order count. Um, as in how many times those customers buy from us, uh, in a fixed period of time. I'm obsessed with those three numbers. And do you know why I'm obsessed with those three numbers is because I, I remember years ago, I mean, this was, you know, in the nineties, Uh, when I was, you know, uh, about six, I think by , uh, in the, in the nineties, uh, when I was in my, in my early twenties, actually, I, I went to a j Abram talk.

Yeah. He did this big session in person in the UK and a friend of mine got his tickets and I remember going to it and he said, there's only three ways to grow a business. You either grow the number of customers, the average order value, or what he called the average order frequency, we now call average order count.

And he was talking about strategies to grow all three. And then he said, if you take those strategies and run them alongside each other, you get geometric [00:43:00] growth. And he pulled out how that all worked. And I remember sitting there thinking, this is, this is genius. And that has stayed with me throughout all the digital stuff that I've done.

Over the last 22 years, you know, it's crazy. Old school marketing.

Jaryd Krause: Old school, man. He's such a Lord, that guy. Like he's Jay Abraham. He's, I've read his book, um, Getting Everything You Can Out of All You've Got.

Matt Edmundson: Yeah. Great book.

Jaryd Krause: Pretty cool book. Yeah. Yeah.

Matt Edmundson: Great book. Especially if you want to get into referral marketing, um, and you know, the upsells and the cross sells, it's all in there.

I mean, it's just, it's old school stuff applied to in modern school ways. Right. Um, Jaryd, listen, I am aware of time and I always love our conversations. You're such an easy person to chat to, man. And I get a thousand good ideas whenever we cook, whenever we talk to each other, which is great. Uh, before we end though, the two questions, first of all, what's your question for me?

We do this thing whereby you ask me a question. I don't answer it. Now I answer it on social media. It's a sneaky way for me to grow my social media following, [00:44:00] but go ahead. What's your question?

Jaryd Krause: What would be three things that you would share with somebody That wants to buy, what would be three things that you would share with somebody that is wanting to grow their eCommerce business

for the long term, with a long term exit in mind?

Matt Edmundson: Very good. What are three things that I would say to somebody who wants to grow their eCommerce business, uh, over the, you know, with a long term sale in mind? Love that. I'm going to ponder that. I have some ideas. I will share them on social media. Yes, I will.

So if you want to hear my answer to that question. We'll do it. Yeah, it's going to be on social media. So just follow me on social, just go find it, at Matt Edmundson, [00:45:00] you'll find me. Jaryd, listen, it has been an absolute treat, man. How do people find you? How do they connect with you? If they want to do that, if they want to find more about what you do, how you can help them maybe sell a business or even help them acquire businesses, what's the best way to do that?

Jaryd Krause: Yeah, sure. Um, my name is Jaryd Krause. You can Find me on all the channels, uh, my website is buyingonlinebusiness. com and if you guys just send me an email, maybe listen to the podcast, you know, start with the podcast from Matt and myself, uh, and then just see if you just like, you know, what I talk about and if you're into it.

My style and, you know, do you think I might be able to help you reach out? Just send me a message, uh, Jaryd@buyingonlinebusiness.com and if I can't help you, maybe I can refer you to somebody you can.

Matt Edmundson: Fantastic. We will of course link to Jaryd in the show notes. And it's fair to say, uh, Jaryd is spelled slightly differently to how we spell it in the uk, J-A-R-Y-D, which I is, is that a common spelling in your part of the world or [00:46:00] is it, is it still unusual for you as well?

No.

Jaryd Krause: It's actually pretty unusual. Uh, I've only met one other person that has the name spelt the same way. He is Australian. Uh, what's funny in where I, where I live in Bali, Indonesia, Nobody can pronounce my name. Uh, and even when they see it, it's like, just call me Jerry. That's my name over here is Jerry, which I'm not stoked about at all.

Matt Edmundson: Yeah, it's fascinating. It's fascinating. I just thought it was a really cool way to spell the name. I thought if I ever call my kid, Jaryd, I'm tightly spelled it like that. Cause it's just cool.

Jaryd Krause: Yeah. Thanks. Yeah. My parents were just out of the box a little bit, I think.

Matt Edmundson: Well, we, I've got a son called Zach, um, and Sharon and I, my wife and I, when we named him, we just really liked the name Zach.

We just thought it was cool. And we're like, let's not, on his birth certificate, I didn't want to write Zachariah or Zachary or Jeremy. And we were just like, no, no, he's just going to be [00:47:00] Zach because everyone's going to call him Zach. So why give him, you know, and, um, Um, we're like, let's not spell it Z A C like everybody, let's just spell it Z A K, because we can and we're cool and we can.

Yes,

Jaryd Krause: that is correct.

I do like it.

Jaryd Krause: I was thinking as soon as you said Zach, I'm like, it's got to be a K, sure. Yeah,

Matt Edmundson: it's got to be a K, all day long. And of course, all the Zachs with a C going, what's wrong with the way I spell it? Absolutely nothing. No, no, no. We all just, it's just the way we were as parents.

And if you're Jaryd with an E, that's fine as well. Or an O. Or an O, yeah, yeah, yeah, fair play. Listen, Jaryd, totally stoked, man. Love the conversation. Thank you so much for coming on. It's been an absolute pleasure, my friend.

Jaryd Krause: Yeah, me too, like I love the questions, I love the discussion, and like you said, it's always a pleasure to chat, so thank you so much for having me on, and yeah, appreciate it.

Matt Edmundson: No worries, hope the surf is good, uh, you know, uh, on the surf mission, is, is, is fruitful.

Jaryd Krause: [00:48:00] Yes. Thank you. It has been so far, so very happy. Yeah,

Matt Edmundson: no doubt. No doubt. Well, I can say, of course, we will link to Jaryd's info in the show notes, which you can get along for, which you can get for free along with the transcript and everything at eCommercePodcast.

com. Net, or of course, if you sign up to the newsletter, that'll be coming straight to your inbox. So another fantastic conversation. Huge thanks again to Jaryd for joining me today. Also be sure to follow the eCommerce podcast, wherever you get your podcasts from, because we've got yet more great conversations lined up and I don't want you to miss any of them.

And in case no one has told you yet today, let me be the first. You are awesome. Yes, you are. Created awesome. It's just a burden. You have to bear. Jaryd's got to bear it. I've got to bear it. You've got it, buried it as well. Now the e-Commerce Podcast is produced by Pod Junction. You can find our entire archive of episodes on your favorite podcast app.

The team that makes this show possible is Sadaf Beynon Tanya Hutsuliak, like, who are both [00:49:00] beautiful people. Uh, theme music was written by Josh Edmundson. He's also a beautiful fella. Uh, and as I mentioned, if you'd like to read the transcript or show notes, head over to the website eCommerce podcast.net. But that's it from me.

That's it from Jaryd. Thank you so much for joining us. Have a fantastic week wherever you are in the world. I'll see you next time. Bye for now.