Amazon sellers who sold and became millionaires

Becoming a millionaire was never part of the plan. Michele Venton had moved from London to Bournemouth, keen to escape corporate life – and decided to try selling dresses online.

“I always had the idea of ​​designing this range of dresses for a particular woman,” she says.

She found a factory to make her wrap dresses and put them up for sale on Amazon, where she was amazed at the interest they generated.

“I quickly understood: ‘Wait!’ “There was a huge opportunity here,” she says.

Clothing, however, wasn’t the easiest product to sell online: too many sizing problems, too many returns.

But as a mother of two, she more than once experienced the awkward feeling of realizing that her children were going to a birthday party in a few days and had no presents to give.

She started selling emergency gifts for parents on Amazon.

In less than four years it was turning over almost £10 million each year in Europe and the United States.

But very quickly, the company became too big. Finding millions of pounds to buy all the supplies she needed for the rest of the year was becoming difficult. “It would take someone with a lot more capital,” she says.

So in 2019, when she was presented with an offer to buy her entire business – for several million – she accepted.

Amazon allows other sellers to list their products on its website and will even do delivery or “fulfillment” for them through its formidable logistics network.

The sheer scale of Amazon means that if they get the products and marketing right, small sellers can find themselves selling huge quantities quite quickly.

With the pandemic forcing many stores to close, many have seen their sales increase to the point where they are struggling to fulfill all their orders.

Two years ago, when Ms. Venton sold her business, it was relatively rare to sell businesses based entirely on selling through Amazon.

The buyer, an individual, insists that we not name him or his products for fear of attracting competitors or saboteurs – such is the hypercompetitive world of e-commerce.

But over the past year, a new generation of companies has arisen to offer Amazon entrepreneurs like Ms. Venton a way to sell their businesses.

The largest and best known is an American company called Thrasio, named after an Amazonian warrior from Greek mythology. They buy one to three companies a week, including around ten in the UK, and want to buy more.

Founded in 2018, it grew from nothing to more than $500 million (£360 million) in revenue in its second year, according to founder Josh Silberstein.

“Back then (in 2018), it took seven months to sell a business, there were more sellers than buyers, and it was an absolute disaster. It was all a terrible experience for sellers,” he said.

Just three years later, according to research firm Marketplace Pulse, 64 companies around the world have been created to buy Amazon-based businesses. Together, they have raised almost $6 billion since April 2020, it is estimated.

Typically, they look for sellers who have managed to pull their heads out of the chaotic hubbub of items for sale on Amazon, rack up lots of positive customer reviews, and appear on the first page or two of items that appear in user searches.

Top Amazon sellers make attractive investments because they often have higher profit margins than their offline competitors, while selling at a lower price than their offline counterparts.

Buyout companies hope that by bringing in the professional skills and resources of a larger company, they can help brands grow faster and become even more profitable.

Amazon buyout companies have also sprung up in the UK, such as Heroes, founded by identical twins, Riccardo and Alessio Bruni.

One of their acquisitions was Davaon, a garden tool brand founded by David Stephen. After many years as a traveling salesman, spending long hours in traffic jams and lonely hotel rooms, he was looking for a job that would give him more time with his family.

His wife suggested he sell things on Amazon. After a $5,000 course, he discovered what he saw as an underserved niche: gardening tools.

After many hours of searching on the Chinese site Alibaba to find a supplier, he had a company, a brand, Davaon, and pruning shears worth $10,000 in his garden shed.

Pruners, shears and garden saws soon joined the range, and by 2020 he and his wife were selling more than £2 million a year, purchased from Taiwanese suppliers they had not yet met in person.

But the goal of an easier life was further away than ever. “It got to the point where we were looking at 12 to 15 hours a day. I was doing weekends, it was non-stop.

“If a customer sends an email on the weekend, you have to respond. I took care of the stock receipts, we packed the boxes ourselves and sent them to Amazon. There was never really a break. “

He began receiving offers for his business last year. At first he thought they were rival sellers, looking for information.

However, ultimately Mr Stephen sold to Heroes, partly, he says, because they took the trouble to visit him in person at his Northamptonshire home.