Flippa is an online marketplace to buy and sell online businesses and digital assets. It announced its first venture-backed round. This was an $11 million Series A. Flippa sees over 600,000 monthly searches from investors looking to connect with business owners.
Details of the investment round
The round was led by OneVentures and also joined by existing investors. These are Andrew Walsh (former Hitwise CEO), Flippa co-founders Mark Harbottle and Matt Mickiewicz, 99designs, as well as new investors Catch.com.au founders Gabby and Hezi Leibovich. Furthermore, RetailMeNot.com founders Guy King and Bevan Clarke; and Reactive Media founders Tim O’Neill and Tim Fouhy also made the list.
The company started in 2019, has bases in both Austin and Australia. It facilitates exits for millions of online business owners, some of that operate on e-commerce marketplaces, blogs, SaaS, and apps. It’s the newest data integration being for Shopify, Blake Hutchison, CEO of Flippa.
Strategy of Flippa
Flippa is the investment bank for 99% of small businesses. It provides an end-to-end platform that includes a proprietary valuation product for businesses. Flippa processes over 4,000 valuations each month. It also has a matching algorithm to connect with qualified buyers.
Business owners can sell their companies directly through the platform and have the option to bring in a business broker or advisor. The company also offers due diligence and acquisition financing from Thrasio-owned Yardline Capital and a new service called Flippa Legal.
Flippa’s strategy is verification at the source, i.e. data,” Hutchison said. “Users can currently connect to Stripe, QuickBooks Online, WooCommerce, Google Analytics, and Admob for apps, which means they can expose their online business performance with one click, and buyers can seamlessly assess financial and operational performance.”
Online retail, as a share of total retail sales, grew to 19.6% in 2020, up from 15.8% in 2019, driven largely by the global pandemic as sales shifted online while brick-and-mortar stores closed.
Future plans with the investment
Flippa has over 3 million registered users and added 300,000 new registered users in the past 12 months. Overall transaction volume grows 100% year over year. Though being bootstrapped for over a decade, the company’s growth and opportunity drove Hutchison to go after venture capital dollars.
As such, the new funding will be used to double the company’s headcount to more than 100 people as it builds out its offices globally, as well as establishing outposts in Melbourne, San Francisco, and Austin. The company will also invest in marketing and product development to scale its business valuation tool that Hutchison likens to the “Zillow Zestimate,” but for online businesses.
