Should we buy this Pot Business Credit Card Processor? - Acquisitions Anonymous episode 151

Want to receive this listing in your inbox? Signup for our weekly newsletter:

https://www.getrevue.co/profile/acquanon

-----

Michael Girdley (@Girdley) and Bill D’Alessandro (@Bill) talk about an online medical marijuana card processor. We discuss how this business operates and why the margins are so big. We guess that this business is underperforming, and we explain how we’d go about scaling it up.

Similar to the general licensing requirements, the requirements for obtaining a business license for cannabis are highly variable from one state to the next and even between municipalities. We also talk about the potential risks that would make this business worth zero dollars overnight.

-----

Thanks to our sponsors!

CloudBookkeeping offers adaptable solutions to businesses that want to focus on growth with a “client service first” approach. They offer a full suite of accounting services, including sophisticated reporting, QuickBooks software solutions, and full-service payroll options.

-----

Show Notes:

(00:00) - Introduction

(00:34) - Our Sponsor is Cloudbookkeeping

(02:01) - Deal & financials: Medical Marijuana Card Processor

(09:43) - How does this business work?

(10:30) - What do we like about this business?

(12:36) - What are the two things that can happen to this business?

(13:20) - Did the pandemic affect this business?

(14:02) - How big do we think this business is?

(14:41) - Where do the high margins come from?

(15:45) - Where is the value in the revenue structure?

(18:25) - What is a cool strategy competitors can do in this line of business?

(23:16) - What does this business remind Bill?

(24:44) - How do entrepreneurs take advantage of stupid regulations?

(26:43) - What’s the story behind “A dollar for a dollar”?

(32:24) - We like this deal. Who could be a fit as a buyer?

-----

Additional episodes you might enjoy:

#149 - Is this car spinner business a good side hustle?
#148 - Growth Marketing explained: Shopify Superfood Greens Brand with 40% subscription rate w/ Baller Jesse Pujji
#147 - $9.6M EBITDA Florida Armored ATM Services Business
#141 - A very profitable B2B Internet Business in the Petcare Vertical
#140 - Let’s SBA the heck out of this deal - with Special Guest Heather Endresen

-----

• Do you love Acquanon and want to see our smiling faces? Subscribe to our Youtube channel.
• Do you enjoy our content? Rate our show!
• Follow us on Twitter @acquanon Learnings about small business acquisitions and operations.