FE International has been in the business of buying and selling online businesses for over a decade. They have gained a reputation for their expertise in the industry and their ability to deliver successful transactions. However, before you dive in and commit to working with them, it is essential to understand what they offer and how they have been received by their clients.
In this review, we will explore the services provided by FE International, delve into their track record, analyze client testimonials, and provide an unbiased evaluation of their performance. By the end of this article, you will have a comprehensive understanding of FE International and be able to confidently decide if they are the right fit for your exit or acquisition needs. So, let’s jump into our comprehensive FE International review.
What is FE International?
FE International is a globally recognized M&A advisor specializing in SaaS, e-commerce, and content businesses. With a track record of successfully completing acquisitions for numerous founders, owners, and acquirers, they are considered a leading authority on valuations in the industry.
FE International (FEI) was founded by Thomas Smale, who is still an active CEO today. The experienced team at FEI comprises experts in exit planning, valuation, accounting, legal, and more.
Their team of creative and strategic thinkers combines formal experience with innovative approaches to valuation, deal marketing, and structuring. With a focus on creating personalized experiences for clients, FE International is equipped to assist both sellers looking to exit their online businesses and buyers looking to expand their portfolios.
Reputation & Recognition
- What is FE International Known For: FE International shines for its detailed advisory services, strong industry understanding, and a legacy of orchestrating high-value, successful deals.
- Years in Business: Originating in 2010, FE International has more than a decade of seasoned experience.
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Track Record Data: As of recent updates, FE International reports a sale success rate of over 94.1% in business sales, having closed 1200+ transactions for a cumulative value of $1,000,000,000.
- Awards & Recognition: Headquartered in New York and with regional offices in Miami, San Francisco, and London, FE International is a truly international company serving clients worldwide. The company has been recognized for its exceptional growth, being named one of The Americas’ Fastest Growing Companies in 2022, 2021, and 2020 by The Financial Times. They have also earned the distinction of being a three-time Inc. 5000 company.
- FE International is also a member of the Better Business Bureau. They have an active BBB business profile that you can check out here.
Types of Businesses Offered by FE International
FE International’s listings encompass various monetizations:
- E-commerce
- SaaS (Software as a Service)
- Content (Niche sites, affiliate websites)
Price tags vary, but generally most businesses listed with FEI are valued at over $100K up to eight figures.
Average Multiples Businesses Sell For
FE International does not have a lot of public-facing content on their typical multiples or the value of closed deals, though they have put together some helpful content about how they value businesses.
In this article, they break down the valuation factors that led to a 3.5x and 10x multiple for two different businesses. They cite the major influencing factors as “site age, financial trends, competition in the niche and time required to manage as well as the nature of the work required.”
FE International’s Commission Fees & Pricing
- For Buyers: While it’s not directly clear on their website, many sources around the web state that FE International levies a buyer fee of 2.5% of the deal or a maximum of $1000 that a buyer must pay upon the completion of the sale.
- For Sellers: Commissions are in line with industry standards, ranging from 8% to 15% based on the sale’s valuation.
Buying a Business through FE International
When buying with FE International, buyers can expect to receive a detailed prospectus that incorporates the comprehensive vetting FEI has performed on the business before it was listed with the brokerage.
The brokerage utilizes a team of accountants to perform pre-marketing due diligence and carefully vets the sellers they represent exclusively. This ensures transparency and provides buyers with a clear picture of the acquisition opportunity, including business operations, growth opportunities, market trends, financial performance, and more.
Overall, FEI works with buyers and sellers alike to help them map out their acquisition goals and ensure there is clarity in the decision-making process.
Buying Process
When buying with FE International, buyers can expect to receive a detailed prospectus that incorporates the comprehensive vetting FEI has performed on the business before it was listed with the brokerage.
The brokerage utilizes a team of accountants to perform pre-marketing due diligence and carefully vets the sellers they represent exclusively. This ensures transparency and provides buyers with a clear picture of the acquisition opportunity, including business operations, growth opportunities, market trends, financial performance, and more.
Due Diligence Process
FE International offers in-depth prospectuses and documentation on the businesses, ensuring buyers are able to execute a transparent due diligence process. While FEI does kickstart due diligence, it is still up to the buyer to do their own due diligence on the business and ensure that it fits their buying criteria.
Selling Your Business with FE International
The selling process via FE International is a holistic experience:
Valuation Process: By navigating to FEI’s “sell a business” page you’ll find several spots leading to a “free valuation” form. By going through the form, you’ll be set up with a consultation with the FE International team who will then compile data about the business to put together a sale price for the business.
Vetting: FEI advertises that they turn away 90% of businesses who ask to list with their brokerage. If a business does get accepted to sell with FE International, the business undergoes stringent vetting, ensuring only genuine businesses are showcased to buyers.
Listing: A brief summary of the business is featured on the listing page with an overview of financials, earnings, traffic, and any metrics pertaining to business growth. The listing page also includes a bulleted overview of the main benefits of the business to help point out the best features to buyers.
Visibility & Information Security: Confidentiality is paramount for sellers. The listing page does not include the URL or business name to ensure copycats or competitors cannot access sensitive business information.
Marketing: The actual marketing of listings isn’t as clear-cut as it is with other brokers. It’s noted that FEI has an audience of tens of thousands, but how those listings are shopped around to that audience base is unclear. It seems as though the main form of marketing involves the broker representing the listing going directly to the buyer network to find relevant buyers for deals. Some sellers may prefer this as it gets buyers with the highest likelihood of interest in the deal involved early on.
Deal Process: FE International’s team plays a very active role in the deal process. They source potential buyers and aid in negotiating for the most money possible for a deal. An assigned broker is there for sellers every step of the way, taking much of the load off the shoulders of sellers to successfully close their deal.
Closing the Deal: Each step, from contracts to payment, is guided by the FEI team. Payments are supported through Escrow to ensure money transfers are secure.
Migrations: Post-deal, the migration process is supported by FE International’s team. They offer technical support and ensuring that the business is transferred appropriately to the buyer and the seller is rightly paid for their asset.
FAQs About FE International
- Is FE International Legit? Absolutely. With a legacy spanning over a decade and over 1200 successful transactions, they’re known as industry leaders in the online business brokerage space.
- Does FE International Offer Post-Sale Support? FE International offers post-sale services ensuring cohesive handovers.
Pros and Cons of Using FE International
Pros:
Expertise: A decade of industry experience equips clients with unrivaled expertise during one of the most important business transactions of their lives.
Tailored Advisory and Support: FE International’s personalized strategies set them apart. From their in-depth prospectuses to actively pursuing buyers for deals, they really pull their weight as a broker to alleviate struggles for sellers and buyers alike.
Active Buyer Network: Their investor pool is expansive and active with buyers who are serious about acquiring. This is a solid pro for sellers who want to sell their business to a serious, capital-backed buyer.
Cons:
Not Ideal Broker for Businesses under $ 100K: Typically, FEI doesn’t sell businesses valued under $100K. Most of their deals are between 6-7 figures, making this brokerage a no-go for small business sellers.
Monetization-Centric Listings: They cater primarily to mid-market businesses in e-commerce and content businesses, as well as a specialization in SaaS. If you have an Amazon-based business, this may not be the broker for you.
Fairly “Old School” Brokerage: While FEI deals with online business models, their brokerage tends to be a bit “old school” in the way that they take a hands-on representative approach to deals. They have physical offices, unlike other brokers in the space and their style mimics brokers who deal with brick-and-mortar businesses. They don’t have an online platform that empowers buyers and sellers to shop and transact freely like other brokers do, making the process a little slower and less streamlined.
The Final Review: Is FE International a Good Option for You?
In the realm of online business brokerage, FE International undeniably stands tall. Their commitment to quality, transparency, and unparalleled service renders them a preferred choice. Be it a lucrative online purchase or a strategic sale, FE International has the decade of experience and infrastructure to ensure a successful exit or acquisition experience.
Thinking of acquiring or selling your business but want more insight? Acquiring Digital offers free discovery calls to help you navigate the sales process and ensure you have an accurate understanding of the current market in order to maximize your sale.
