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Apr 27, 2020 — This award-winning website design and SEO Company specializes in providing digital marketing solutions, custom website development, and more. Founded in 2017, this full-service digital marketing company provides valuable development and marketing services for businesses of all sizes in multiple verticals. They create custom SEO and PPC marketing strategies for their clients. Unlike many marketing and web development firms that rely on one-time development projects, this boutique agency has established a highly valuable base of recurring revenues with approximately 30% of the TTM revenues coming from residual income. About 60% of revenue comes from website development, 30% from SEO and 10% website maintenance/updates. The company is overly efficient, with minimal fixed expenses, as this is clearly illustrated by its 87% net profit margin.
The business had been experiencing impressive YOY growth in 2019, as sales were up 58% and EBITDA was up 43%, compared to 2018. Due to COVID-19, the business has declined in 2020 and is currently generating a net income of about $5k per month. The business has been priced in consideration of its current profits and is priced to sell.
The reputable firm and its attractive recurring revenue business model allow for a low working capital structure with minimal fixed overhead expenses. Nearly all aspects of the business are operated by the owner. However, she does utilize a few contractors that help with extra work such as graphic design or fixing updates on existing websites. She also uses one PHP developer that helps with software related items. Additionally, she has one content writer and 4 bloggers that provide content for free throughout the month to help with their own SEO.
With an increasing number of clients maintaining an active marketing campaign and/or development maintenance, this business represents a high-quality acquisition opportunity with a history of strong and growing cash flow and a highly valuable base of recurring client relationships and revenues.
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