Announcing EF Capital: Passive and Diversified Portfolios of Online Businesses
We have been hard at work behind the scenes on something unique, and what we think could be game-changing for the entire industry.
If you’ve been following us over the last year, you know we’ve been building the most cutting-edge technology platform when it comes to buying and selling online businesses. Our entire marketplace is based on this technology. When someone registers for a free account, they’ll get access to a variety of search tools that will help them speed up the due diligence process to find the perfect acquisition.
Our technology has helped buyers make more informed decisions that have led to more profit than ever, once they take over a new business. It has also helped our sellers sell their businesses faster.
Since launching our technology platform, we have achieved some pretty amazing results:
- Sold our first $12 million deal
- Regularly get between 100–150 seller submissions per week
- A marketplace featuring $55,984,584.00 worth of digital assets for sale
- Buyer network with over $1,323,502,202.75 in proof of funds to acquire businesses
Since implementing our technology, we’ve been able to remove seller listing fees when entrepreneurs submit their business for sale, and reduce our exclusivity from six to just two months.
We’re pretty proud of this, and we’re even more proud that it has helped our buyers and sellers complete deals faster and with less friction.
However… we want to do more.
Our whole mission is to make it easier than ever to buy and sell online businesses. We want to take the often murky process of buying an online business and create a system for you that just works. We want to make investing in online businesses a viable asset class for the average high net worth investor, right up there with stocks, bonds, real estate, and other alternative investments.
Investing in online businesses is not passive investing. It is the very epitome of active investing. In takes a lot of work to understand how to acquire a business, how to run that business successfully, and really drive the ROI that is possible with digital assets.
Even if you have the specialized skill set to run online businesses, it’s typically around a specific business model or single business with single points of failure. It takes a very different skill set to run an Amazon FBA business than it does a content site or SaaS. Owning a single business is a great way to generate wealth but it is risky from an investment perspective because all your eggs are in one basket.
That is where EF Capital comes in.
How We’re Turning Active Investing into Passive Dividends
EF Capital is going to allow accredited investors with as little as $10,000 to start investing in online businesses. While you can start at $10,000 we recommend starting with $100,000 to invest across all the deals EF Capital is featuring. You will be able to invest in several different deals to build a diversified portfolio and own fractional pieces of larger online businesses.
How it will work is you will be able to view a list of business operators to invest in. Once you and other investors have invested the amount of money that operator needs to go out and purchase a business, they go out and get the best deal possible for themselves and the investors. After they acquire the business, they do what they do best and manage and grow the business.
investors will be paid out a dividend once per quarter from the profits the business earned the previous quarter.
The accredited investors won’t need to speak with the operator, manage business operations, or even offer input on how to run the business. It’s a completely passive investment with quarterly reports and quarterly payments until the business is sold in 2-4 years. All you have to do is pick which business operator deal you want to partner on, send in the money, and… that’s it.
This is the most passive form of investing possible that we could dream up for our space.
It will allow you to leverage your money and capital to grow without any need for your active involvement. The best part is, you will be able to easily put together a diversified portfolio of online businesses.
Alright, so I imagine you have some questions here, so let’s try to answer them for you.
Or, you can read the official EF Capital launch page here for more details on how to get started.
The Major Problem and Our Solution
As much as we preach about acquiring online businesses, the main problem most investors face is no secret.
Buying an online business is not like buying a stock or even a piece of real estate. It is active investing. It is entrepreneurship with a larger entry fee. This can reasonably distress a lot of would-be buyers and stop them from ever acquiring their first deal.
If you’re like a lot of people we talked to over the years who want to get involved with digital assets, you probably resonate with one or more of these problems:
- You have the wealth to invest but no time to gain the skills
- You’re an entrepreneur with way too many projects as it is, despite wanting to get involved
- You’re a rock star internet marketer that knows you need to diversify your revenue streams with more business models, but you know how hard it is to learn a brand new model
- You’re a high net worth employee wanting to see the returns’ entrepreneurship can provide, but your job is too demanding to set aside time to acquire and grow a business
These are just a few examples of how this active investing problem plays out. Most people we speak to want to jump in and experience the rewarding returns an online business can offer, but very few actually take the leap. The plethora of problems and life situations that prevent this style of active investing are many and vast.
Luckily, if you’re experiencing one of those life situations, we’re solving the whole thing with EF Capital.
EF Capital is the first and most passive way for you to start seeing the same kind of returns other high-level internet entrepreneurs experience month after month.
In fact, you’re going to be able to leverage the ability of those high-level internet entrepreneurs to grow your money for you. These are the kind of entrepreneurs we’ve spent months vetting to become the operators for EF Capital.
Who Are These Operators?
As you might imagine, we have connections with a ton of buyers and sellers.
We’ve spent years becoming the largest curated marketplace in the world for digital assets, and this hard work has led us to having quite the rolodex of talented entrepreneurs who are themselves looking to grow in a big way.
We know who the skilled entrepreneurs are who’ve done real profitable work and who the not so good ones are.
After all, we’ve often built their profit and loss statements when they sold their businesses with us.
Most of our selected operators were once a seller or buyer on the Empire Flippers marketplace. This means they’ve built, bought, or sold a profitable business. These operators know what they’re doing.
It also means they’re part of a fairly exclusive group of entrepreneurs considering we reject around 88% of businesses that try to sell on our marketplace and, as you know, most entrepreneurs end up failing despite their best intentions.
These operators are successful entrepreneurs who want to invest their own money and leverage other people’s money to run a bigger business. .
For instance, an entrepreneur who has successfully built and sold a $1,000,000 Amazon FBA business often has the skill set needed to run a $2 million Amazon FBA business.
That is where you come in as the investor.
Your capital gives these successful entrepreneurs the fundraising they need to go out and acquire these big brands, and you get to participate in the returns that online businesses offer without having to actively run one.
How Do the Investment Deals Work?
Every operator will create a unique investment deal.
You will be given a profile of the investor and their past accomplishments and core competencies to review. In addition, this profile will state the operator’s investment thesis.
The investment thesis will include what they plan on doing with the investment money, what kind of business they’re looking to buy, their growth plans, and their potential future exit plans.
Every business the operator buys will be bought on the Empire Flippers marketplace; that way, we can make sure the quality is retained since we have vetted the businesses using our rigorous process. Each deal will also be dedicated to a single type of business model, and that business model must be the one the operator has a successful track record in. .
For the initial EF Capital launch, we are starting with two business models:
- Content (affiliate, display ads, etc.)
- Amazon FBA
Operators within the same business model will have different strategies and we will expand to other business models later.
What Kind of Returns Will Investors See?
This will be difficult to tell, because investing in online businesses is a volatile place. It doesn’t have the same kind of history of returns as the stock market or real estate market does.
This is why we insist you do multiple deals and put together a portfolio.
When you diversify your investment across multiple deals, we believe the returns can be up to 20–25% annually.
This projection is based on 20% of the businesses completely failing, 20% growing by 50%, and the remainder staying the same.
So… When Will You Get Paid?
After you invest in a deal, you’ll need to expect between a six- to nine-month delay before dividends are paid.
The reasoning for this is partly based on the operator’s growth plan but also on our industry in general. You see, many online businesses get paid what is known as a Net 30. If you make $10,000 this month in net profit, you won’t actually see that money until 30 days after earning it.
Net 30 is the most common variant of this payment schedule and often exists in affiliate marketing and display ad niches, but can also be seen elsewhere. Sometimes, the Net payment can go up to 60 and 90 days too, but this is less common.
This delay in dividend payouts also helps the operator use the initial cash flow of the business to accelerate growth. This allows the operators to give you as an investor an even bigger payout since those early wins can compound effects on future returns.
Once this delay period is over, you will get paid four times per year—once per quarter based on the previous quarter’s profits.
The breakdown percentages of the dividends are as follows:
- Investors 66.7%
- Operators 20%
- EF Capital 10%
- Independent Advisors 3.3%
It is predicted that the majority of businesses acquired through investor deals will be held onto for two to four years before being sold.
When the business is being sold, you’ll recoup your initial investment.If the business sold for more than what it was purchased for, the split will remain the same as the dividends.
What is the Minimum Required to Invest?
The minimum investment is $10,000 per deal. We strongly advise you to do multiple deals in order to diversify your risk and build a portfolio. If you’re only able to do one deal we suggest that you don’t do the program at all. it would put you at far more risk of losing the money, as everything is tied up in a single deal.
Of course, you are not limited to the minimum investment. Operators are looking to raise several millions of dollars for acquisition, which means there’s plenty of room for you to deploy your capital.
Just keep in mind what we always say when it comes to investing into a business: this money should not be some sort of emergency money or attempt at financial freedom from debt. Only invest the amount you would know you’d be 100% fine if you lost it all.
This is the exact same advice we give to our buyers, and you’ll do well to heed it. Investing in online businesses is risky, but with the risk also comes the outsized reward that is possible when done well.
What Does EF Capital Do During All of This?
One of the great aspects of this investor program is that all interests align with each other—including ours.
All the businesses that are bought through the investor program will be acquired on our marketplace. But it’s not just the sale of a business where our interests align.
EF Capital will receive 10% of the profits of the business acquired. This means it is very much in our interest that they succeed just as much as it is yours. It’s a fair question to ask what we are doing to deserve that 10% though.
The first obvious thing we’re doing is creating the room where connections can happen in the first place, using our technology and network. There are a ton of busy professionals who want to get involved with digital assets but simply don’t have the time. On the other side of the coin, there are plenty of extremely talented entrepreneurs who are frustrated at how slow they have to go as they bootstrap themselves to the next level of business ownership.
These two people rarely meet each other if ever.
Our technology and reputation allow them to meet in an easy, frictionless way for the first time.
We bring the deal together, but that’s not all.
We also manage the deal.
You as the investor look at the investment deals being offered and decide which ones you want to invest in and how much. All operator communications are handled by us, the screening of the operators (which is a lengthy process), and auditing of the actual fund is done by us along with a third party company that has a vast amount of experience in managing funds.
We make sure you get paid out on time, make sure the operator buys businesses that meet the criteria they explained in the deal, and make sure the operator is focusing on their core competencies.
Since all these businesses will be acquired off our marketplace, and since we’ll own a stake in the business ourselves, it will become a very streamlined process when it comes time to exit the business. Our advisors will be able to help the operator understand how to get the best possible valuation before listing it for sale on our marketplace, and our team will already know what to say to buyers to actually drive interest for a relatively faster sale.
You’ll get to leverage us in handling all communications on your behalf, while also leveraging our reputation as one of the largest business brokers in the industry.
How to Start Investing… Right Now
If any of this at all sounds interesting to you, then we have good news.
You can start choosing investor deals to deploy your capital today. As long as you’re an accredited investor all you have to do is go check out this page, scroll down to the bottom, and follow the directions there.
You’ll be taken to sign up for an Empire Flippers account if you haven’t already, and then you’ll be able to see all the investment deals currently being offered. You’ll be able to see the operator’s track record, their growth plans, and everything else they plan to do with the money they raise to acquire digital assets.
We’ve designed the entire process to be as frictionless as possible for you as an investor and make it easy to build a diversified and passive portfolio of online businesses.
Our mission for years has been to make digital asset investing mainstream. The active investing portion is what has always been a large limiting factor for us to be able to do that. EF Capital solves the active investing problem and finally brings the opportunity packaged as a passive, hands-off investment to you.
If you’re ready to leverage some of the most talented internet entrepreneurs around to help you grow your money, then click here to learn more.
By the way, we’re committed to transparency here and so for legal reasons talking about this fund, we want to publish the legal disclaimer surrounding EF Capital:
- Past performance is no guarantee of future results and any expected returns on investment disclosed through the investor platform are hypothetical and may not reflect actual future performance. All investments made through the investor platform may result in partial or total loss. All fund performance information disclosed through the Investor Platform is presented prior to the removal of all management fees and expenses unless otherwise disclosed. Some of the statements made on the Investor Platform constitute forward-looking statements and should not be relied upon as predictors of future events. These statements may fail to account for both known and unknown risks, market or other uncertainty, changes in the economy as a whole, or changes outside of the control of the Operator.
- Nothing contained within the Investor Platform or the Services should be considered investment advice and you should obtain investment and tax advice from independent investment professionals prior to investing in any offering provided through the Investor Platform or the Services. All information provided through the Investor Platform and the Services, including information in private placement memorandums, have been prepared without knowledge of or concern for each Investor’s individual financial situation or risk tolerance. Nothing contained within the Investor Platform or the Services should be considered to constitute tax, legal, or investment advice.
Now that the disclaimer is out of the way, we’d love to hear your feedback. Send us a message in live chat (bottom right corner), or check out the official EF Capital page here to learn how to get started.
Is it only for accredited investors?
It is only for accredited investors 🙂