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Jim Rea posted a new Selling A Business thread on 11/5/2011

Selling a start-up specialty foods business

Hi All,

Business partners and I have spent almost two years developing a set of beverages and foods nutritionally designed for pregnant and nursing women, a captive market of 6 Million women in the US with real nutritional needs, and no good solutions. So real that we have patents pending on our technology and are an approved Life Sciences company under the MN Angel Investor program. We have pro-forma financials, product samples, marketing materials, patents pending, a fully functional ecommerce site, a custom-written 43 page ebook on pregnancy and nursing nutrition co-written with a credible Assoc. of prenatal nutrition, RD, LD, CDE and much, much more. We brought the products to the point we were pre-selling.

http://www.nurturwell.com

For family reasons (actually for health insurance reasons) I had to focus on finding a job, hoping to keep Nurturwell going at the same time. This isn't possible. It takes a dedicated person to chase after sales and line up production. So the business, as it stands, is for sale. Since no product has been produced, only lab samples made up, there's no aging inventory to worry about and the buy-in can be comparatively small. Note that there will need to be capital for the initial production runs.

Does anyone have any idea as to how to sell this pre-sales business?

Thanks ahead of time.
Jim
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Erik Mack Responded on 11/7/2011


You should start by listing it on bizbuysell.com. I just sold my coffee shop using an online service. I was skeptical at first but we had a few offers and plenty of interest. And ended up getting a good price.
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Shane F. Responded on 11/10/2011


Jim, unfortunately because you do not have a tangible business but rather an idea, (albeit a well planned, almost functioning idea - still an idea nevertheless) you won't get nearly enough to justify walking away.

Do you HAVE TO sell it? How much is it costing you to keep it in limbo where it stands now? Your situation may change in the future and if it does, you may have another chance at it. Pixar lost millions of dollars every year for several years before that idea ever became a functioning reality. Amazon lost hundreds of millions for several years before they realized their idea. Either one of them could have sold but they didn't. They never lost hope. It doesn't sound to me like you are losing that much by keeping it on life support, and the tone of your post sounds like you don't really want to sell it. -So don't, if you don't have to. At the very least, consider bringing in a partner, and selling only half of the concept.

It looks like you've got a great idea that you are passionate about. Consider keeping the dream alive if you are able. If you're that desperate for the money then that's another story. Do what you've got to do. You can always start again with something else later. -But if you are able to just pause the operation until things stabilize, then do that.
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Kim Pezza Responded on 11/18/2011


I know where you're coming from in having to sell. I created a retail program that I never got to develop due to an accident. I also need to find someone to take it over, as I'll not be able to do the traveling and some of the other work that would be necessary. Not only that, medical bills wiped me out financially, I'm not eligible for disability, but can't get work because employers see that I can't always carry out the necessities of the job, due to my injuries, so I'm screwed. Plus, health wise now, and with my difficulties getting around when the temps drop below 70, I need to move out of the north, so as much as I would like to develop the program, realistically I'll never be able to do it now. But, I'm ok with getting rid of it so I can move on to things I can accomplish.

That said, once the program is sold and I can move, there are a few options I will have, including creating a program in food gardening for special needs people. Sort of taking my negative and making a positive.



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Andrew Clarke Responded on 11/22/2011


I agree with Shane. You will probably not get much for the company at this point. Investors generally want to see actual revenues and a growing list of customers before they get interested. I would try to hang on to the company for a few years and keep working on it in your "spare" time.

But if you really want to sell it, hire a business broker. Check out MBBI (Midwest Business Brokers and Intermediaries), or just look up "business brokers" in Google or Bing. Business brokers do this for a living, and usually have a great "rolodex" of investors or business buyers.

You could still try to sell it yourself. To do that I would just start networking. Entrepreneurship centers, business incubators, and private equity firms are all places to check out. Every few months I run into someone who is looking to buy a business. Most of them want an established business in a particular industry vertical (eg light manufacturing or professional services) with revenues between $2 and $10 million. But you might get lucky and find someone who is a little more open minded.
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Michael Cook Responded on 1/27/2012


I agree with Erik, BizBuySell.coom is probably the best place to try and sell it yourself. I've listed a business with them previously, which I was able to sell within 4 months from a lead I got from their site.

I did see that they recently launched a 100+ page eGuide to Selling Your Small Business, which I was able to download for free.

But you might need professional help, and I'd consider talking with a business broker about it. Usually they only represent businesses looking to sell for a minimum of $200,000. Since you said you haven't had any sales yet, but you might have some potential patents, you might also look to seek out an M&A advisor who specializes in your field. They will have a roster of strategic buyers looking to scoop up new technologies and/or patents like yours..
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