Entrepreneurship can seem like an out-of-reach dream for many people, with the harsh reality that 90 percent of startups fail. However, there’s an exciting alternative gaining momentum: entrepreneurship through acquisition (ETA). ETA is the act of buying and running an existing business. It is an intriguing path to entrepreneurship, and I’d like to think that my journey with Baskits Inc. can serve as an example of what can be achieved through diligence, vision and the unwavering pursuit of growth and success.
While ETA might be an unfamiliar concept to some, it’s a path gaining traction, especially as the succession crisis looms in countries where many entrepreneurs are set to retire in the next couple of decades. This crisis is creating increased demand for takeover candidates, offering young MBA and business professionals the opportunity to step into the role of CEO. However, this route to leadership is far from a shortcut. Researching the right business to buy can take years, requiring meticulous due diligence and a discerning eye for the right opportunity.
I embarked on this unique journey to business ownership nine years ago. As a former investment banker, I kickstarted my career by immersing myself in the intricacies of mergers and acquisitions. My journey then led me to private equity, where I continually sought out successful multimillion-dollar companies for acquisition. However, when I decided to buy a business for myself, I had a unique vision in mind. I wasn’t merely looking for a business to own; I was searching for one with its best days yet to come. I wanted a venture where I could leverage my financial expertise and also make a significant impact.
Despite all my education and professional experience, finding the right business to buy proved challenging. I spent four years meeting with business owners and exploring potential acquisitions. Hundreds of companies were reviewed, and several deals fell apart for various reasons before I finally stumbled upon Baskits Inc. in 2014.
At first glance, the gifting company didn’t seem to meet the growth potential I was seeking. I recall perceiving a lack of sophistication in the gift basket industry and thinking, “Anyone can make a gift basket in their basement.” However, upon closer examination, I was able to identify certain key criteria that aligned with my vision and skills. I saw an opportunity to bring fresh thinking to the gifting industry.
Baskits was on a downward trajectory when I took the helm, making my initial years as CEO particularly challenging. It was a time of transformation and self-discovery as I worked around-the-clock to turn the business around and find my own leadership style as a young, first-time CEO.
Fast forward nine years, including a few unpredictable pandemic years, Baskits has witnessed remarkable growth. Sales have grown sevenfold, experiencing three-year growth of 184 percent, largely driven by the company’s rapidly expanding e-commerce platform. My ambition is clear: to push the company’s annual sales to $100 million, a substantial but I think achievable, leap from its modest beginnings when I first acquired the company.
For those considering the ETA journey, here are a few words of advice:
