Platform to sell and buy businesses with financing available
Table of Contents
In this episode of the Tekpon SaaS Podcast, host Cristian Dina sits down with Ignacio Villanueva Martin, the driving force behind Boopos. Boopos is a financing company that is pivotal in acquiring SaaS businesses, e-commerce sites, and marketing agencies by providing vital lending and advisory services. Together, they delve into the intricacies of buying and selling businesses in the SaaS space, financing opportunities, and the dynamic market environment.
Ignacio’s journey into the world of fintech and business acquisitions is inspiring and multifaceted. Growing up in various countries, he represented Spain in professional rugby before pivoting to a fintech career at age 25. His transition wasn’t straightforward; 2015, in particular, marked a roller coaster year filled with highs and lows. Despite these challenges, Ignacio’s enthusiasm for fintech and business acquisitions shines through.
Central to the discussion is Boopos’ unique financing model. The company generates revenue primarily from sell-side fees and interest rates on the debt it creates, offering, on average, four-year loans. This model is advantageous for buyers as it allows them to leverage equity for multiple acquisitions without risking personal capital. However, Ignacio cautions about the potential risks of overleveraging, which can stifle growth and impede debt servicing.
What is Boopos?
One of Boopos’s core benefits is quick access to financing without the need for personal guarantees. This is a significant contrast to the drying up of other avenues like SBA loans and venture debt, both of which have stringent personal guarantee requirements and long processing times. Ignacio shared that Boopos has successfully deployed over $70 million and has recently raised an additional $175 million from Fortress, a venture debt fund.
This influx of funds positions Boopos as a formidable player with the potential to become a unicorn in the future.
Ignacio elaborates on the company’s evolution. Initially contemplating business acquisitions, Boopos strategically shifted its focus to offering financing solutions exclusively for subscription-based enterprises. Today, they concentrate on SaaS, marketing agencies, and e-commerce businesses with subscription models.
A defining element of Boopos is its curated marketplace, which hosts online businesses that meet specific criteria: profitability and at least $100,000 in trailing twelve months (TTM) revenues. For more established businesses with over $500,000 in TTM revenue, Boopos offers detailed advisory programs, assisting with relationships, financial strategies, and deal structuring. Their marketplace is designed to facilitate deals with optional embedded financing, ensuring a streamlined, integrated process.
How does the SaaS M&A market look?
Ignacio also touches upon the challenges sellers face when looking to exit their businesses. These include misaligned expectations with market valuations and a general lack of awareness about the time and preparation needed for selling. Boopos addresses these challenges by advising buyers and sellers on financial metrics, transferability, and dependency on other platforms, ensuring they are well-prepared for transactions.
Highlighting the market potential, 200-300 institutional buyers, predominantly PE firms and larger SaaS companies, are actively seeking investments with substantial capital. These buyers are attracted to the marketplace due to the curated nature of the listings and the readily available financing options. On the other hand, sellers typically aim to capitalize on their hard work, finding exit opportunities that offer liquidity and the chance to move on to new ventures.
The conversation takes a thoughtful turn as Ignacio emphasizes continuous learning and curiosity in professional development. Drawing a parallel between reading in business and working out in sports, he underscores the importance of staying informed and being open to new ideas. Networking and relationship-building are other crucial elements, as Ignacio recommends actively meeting people and expanding one’s professional circle.
In summary, this episode sheds light on Boopos’ transformative role in the SaaS acquisition landscape, the strategic market insights shared by Ignacio Villanueva Martin, and the fundamental importance of education and networking in achieving success.
