#389 – From Banking To Accidental Multi-Million Dollar Amazon Success with Sumana Sanjeeva
Stepping out of the familiar can be as terrifying as it is thrilling—just ask Sumana Sanjeeva. From the structured corridors of banking to the wild frontier of e-commerce, her journey is a tale of audacity and strategic genius. Sumana unfolds her narrative, revealing how she took a gamble on an Amazon business, multiplying her investment fivefold, thanks to a voracious appetite for learning and keen business acumen refined through industry masterminds and networking events like the Billion Dollar Seller Summit.
Imagine diving into a new venture, armed with nothing but a courageous heart and a vision. That’s what Sumana did, securing an SBA loan and leveraging her home to buy into an Amazon business she barely understood. Her candid recollection of those first days, deciphering the alien world of the Amazon Seller Central and grappling with inventory management, paints a vivid picture of the entrepreneurial grind. Sumana’s tactical approach to financial planning and business growth, including navigating the intricate dance with brokers and aggregators, is nothing less than a playbook for aspiring Amazon sellers.
As we follow Sumana’s journey, we step into the shoes of someone who’s not just conquered e-commerce but continues to reinvent success on her own terms. Now, as she prepares to sell another brand and anticipates attending BDSS for further enlightenment, her story serves as a beacon for those yearning to venture beyond their comfort zone. Sumana’s invitation extends beyond this episode ready to connect and share the wisdom of a journey well-traveled.
In episode 389 of the AM/PM Podcast, Kevin and Sumana discuss:
- 00:00 – From Banking to Amazon Millionaire
- 03:19 – Event Planning For Networking Events
- 07:32 – Career Path in Banking
- 11:32 – Discovering Amazon Business Listings
- 15:46 – Starting An Amazon Business With SBA Loans
- 20:49 – Adapt to Business Challenges Quickly
- 27:30 – Business Strategy and Growth Through Acquisition
- 30:26 – Inventory Management and Profit Growth
- 33:47 – Selling a Business for Millions
- 35:18 – Valuation Discrepancy in Business Sale
- 37:34 – Multiple Offers Lead to Successful Sale
- 45:22 – Entrepreneurial Success and Future Plans
- 48:20 – Success Through Smart Business Decisions
- 51:20 – Kevin King’s Words Of Wisdom
Transcript
Kevin King:
Welcome to episode 389 of the AM/PM Podcast. My guest this week is Sumana Sanjeeva. Sumana came to the United States when she was 22 with her husband, started working in banking, then actually bought a franchise business and then stumbled into Amazon. When she went to sell her franchise business, she saw a listing for this Amazon company that was making a bunch of money on this business selling site. She didn’t really know even what an ASIN was. She decided to go all in, bought it and within a year she 5X’d her money and sold that business. It’s an amazing story. She’s a really smart lady. You’re going to really enjoy this episode with Sumana.
Kevin King:
Look who it is. It’s my favorite Hall Pass buddy, Sumana. How are you doing, Sumana?
Sumana:
Hi Kevin, I’m doing great. Thank you so much.
Kevin King:
Now we met, I think with BDSS, right? Is that where we first met?
Sumana:
That was the first time we met and before we start, I want to say it’s such an honor and a pleasure just to be here talking to you. It’s wonderful. Thank you. And yeah, BDSS, Puerto Rico was the first time we ever met.
Kevin King:
How did you hear about BDSS? What made you actually decide to come to that?
Sumana:
That’s actually a great question. So I just started attending the mastermind groups before BDSS. There was only one event that I attended that was actually by accident that was the China magic, and I just ended up. That was the first event I ever attended as an Amazon seller. Before that, I didn’t know all of these so many you know masterminds actually were there and I think, I actually ended up googling it after coming back from China Magic, I’m like, okay, wait, I think there must be more you know masterminds and more people that are going to different events, what should be there, and the first thing that came up was BDSS and it was going to happen like right around, and it was, I think. If you remember, I booked it a day before BDSS started and I was there.
Kevin King:
Oh, wow, yeah, I don’t remember that. You booked it like, okay, you’re one of those last minute people.
Sumana:
Yeah, very last minute, and I don’t think they had anything prepared for me because when I walked over there they were like, oh wait, you, you just booked yesterday, didn’t you? I’m like, yeah, I did.
Kevin King:
That’s awesome. That’s awesome. And now I think you’re coming to Hawaii. But you haven’t booked your hotel yet but so it’s going to be another last minute thing.
Sumana:
It is going to be one of those last minute things.
Kevin King:
So you don’t want to wait too long because our room block. You know when you do these events. A lot of people don’t realize this. We have to guarantee a certain number of rooms. In exchange for that they give us discounts, like on the ballroom or something like that. Or we don’t have to pay for the ballroom, we have to pay for all the audio visual equipment and all that, but they don’t charge us. Like to rent the room. But if we don’t hit that guarantee of number of rooms, we have to pay for all the empty rooms oh wow and so then they let you adjust it about 10.
Kevin King:
So that’s why, when you go to events, people are like here’s our booking link. You know, please book through us. A lot of times there’s a discount on that, as well. But if we don’t hit that, they were on the hook. How was it when you went to Puerto Rico? Was it what you expected? How was BDSS for you?
Sumana:
That was my first actual event that I attended where it was like packed with great content and like great speakers and so many great people that I met there. I came up with so much energy. I was like, wow, this is what these events do. And after that event, actually I’ve met a lot of other events. But I still remember everything that was covered every person that I met there, you know, it was just an amazing event.
Sumana:
And also, of course, you know, I swam in the sand when we did the whole, you know, I think you had great activities planned. That was amazing. That was actually really fun with all the sellers to, you know, compete and like, just have fun. It was a lot of good playful events that we had there. And you know, I thought that kind of really, I think, gave me so much energy when I came back. I think I applied or kind of taken so much of the content that was presented there and so many hacks that were presented there and I applied to my business. Like, right away, I was like, ok, I got to do this, this, this, this. So that was great.
Kevin King:
So, speaking of fun, I think you’ve been having a little bit of fun actually doing this whole Amazon game. Your background was what? Before this, you were in banking, right?
Sumana:
Yeah, that is correct. So I was a branch manager at I don’t know. Do you remember Wachovia Bank when it was Wachovia?
Kevin King:
Yeah, before Wells Fargo bought it. Right, that’s right, that’s right, yeah.
Sumana:
So Wachovia, and then Wells Fargo took over. I worked for Wells Fargo for a year. So I was a branch manager for a long, long time. Did that and then had my second daughter and when I had her I decided to take a break. Took a break for some time. After that, I was looking for a job and my husband was like you should start a business. I was like why do you think I should start a business? He’s like I think you’re going to be good at doing business. I was like okay. So I ended up starting a franchise. It was a math and English learning center for kids. It was an after-school program, started with one location that did well and then ended up opening two more locations.
Sumana:
Did that for about eight years. Kind of got burnt out because I had three locations. I was driving all over the place, you know just a lot of a lot of work from morning till night. I would come home at like 9 o’clock in the night. So that was the, you know, pre-Amazon world that I, a pre-Amazon career that I had.
Kevin King:
So was that? Were you actually doing the instructing of the kids or were you just like managing the locations and you had people working for you?
Sumana:
Yeah, I was managing the locations and I had instructors, a lot of teachers that were teaching, so I had over 300 students attending those sessions. So that was a lot of work and you know managing the centers and you know, managing the employees, managing the centers and managing the employees, the teachers, the administrative staff and just talking to parents and those things.
Kevin King:
Yeah, now I’ve got a question about the banking. So when you’re doing the banking, did you start out as a teller and work your way up? Or did you go to college for finance and just end up in banking? Or how did you end up actually in banking?
Sumana:
Wow, I don’t think anybody has asked me that question before. So yes, I actually started as a teller a long, long time back. And the way I kind of started there the first day of my training, they were talking that the person was training. They were talking about, you know, nickels, dimes and pennies. And I knew what a penny was, I knew what a quarter was, but I did not know what a nickel and dime was. And you know, and I was sitting there the training and she’s talking about, you know, for nipples makes, sitting there in the training, and she’s talking about, you know, four nickels makes this and this, and then nickels make that and you give out change. This is how you should, you know, give and things like that.
Sumana:
And I looked at the person next to me and I asked her. I said what is this nickel and dime? And you know, literally the look on her face it was almost like a horror on her face was like, oh my God, you don’t know what a nickel and dime is and you’re sitting here at the training. That was how I got started in banking and then after that, I think within two and a half years, I was a branch manager. So I started as a teller and became a branch manager in about two and a half years.
Kevin King:
And you figured out what nickels and dimes are and what the difference between a $20 and $100 bill is. I’m assuming is that because you came here from, you weren’t born here, right?
Sumana:
No, I was not born here. I was born in India, raised in india, came here when I was 22 and a half. Let’s not forget that half right. So I was 22 when I came here but I have lived here longer than I have lived in India. So yeah, I just want to explain why you didn’t know when you go to, what a nickel on a dime was, just so people would understand.
Kevin King:
So after the franchises or the education stuff, did you sell that or do you exit that or just close them down, or what’d you do?
Sumana:
I did. I sell them, so that kind of, I think goes hand in hand with how I got started with Amazon. So I actually went online to list that business for sale. So my daughter was going to go to college, my older one and I wanted to really take a break. I wanted to sell those re-franchise locations and just try to, you know, stay at home, be home, be at the stay-at-home mom for a while for my daughter before she went to college and just be, you know, spending some quality time with her. That was the plan.
Sumana:
So when I went online to list those three locations for sale, before I could sell that business, when I went to list this business for these businesses for sale, I saw a shiny object, you know, caught my eye on the corner of the screen and said you know, work from home and make, it was, I think, it was like over three hundred thousand dollars. It was like three hundred forty seven thousand dollars, and I was, wait, how can I work from home and make more money than I was making with the three locations of franchise I had? This is some kind of a, you know folks, and like somebody is just kind of putting it out there. But I was curious. I wanted to know because I was like, okay, if I could sell these three franchises. I wanted to know because I was, like, okay if I could sell these three franchises locations and I can still work from home so I don’t have to be like not doing anything. I can still be making money. So I ended up picking up the phone and calling the broker that had listed that business for sale.
Kevin King:
Was it something like Biz Buy Sell or something like that Biz Buy Sell?
Sumana:
That’s exactly the site that I was on and I didn’t even know that site existed until my franchisor, kind of, suggested because I wanted to sell the franchise locations and he was like, oh yeah, everybody lists their franchise on biz, buy, sell. Why don’t you go list it on there? I was like, okay, uh, that’s really how I.
Kevin King:
I got to that site and so yeah, that that was the so before you sold, you saw this other one and you called them and they said what was it? Was it an amazon business that someone was selling, or what was it?
Sumana:
Right, right. So when I called the broker, he said it’s an Amazon business. And I was like what is an Amazon business? And of course it was listed for 1.1 million. So I’m thinking after 1.1 million dollars, I’m gonna own a small chunk of Amazon because I honestly did not. Until he really explained to me what it was, I really did not even realize that it was not Amazon that was sending me the products every time I hit buy. It was not Amazon and that was for me.
Sumana:
That was very confusing. I’m like what do you mean? Like I don’t understand. Isn’t it Amazon that sends me every time I buy something? Don’t they have this huge warehouse somewhere that just ships me the product? And he was like poor guy. He was trying to explain to me how this whole Amazon business works and it wasn’t making sense to me. And I said, okay, I will do some research and really kind of understand. And then I was like so what is this product that I’m supposed to be selling? And he said it’s board games. I’m like, okay, what kind of board games? And he was like backgammon. I was like backgammon. What the heck is that? I’ve never played a game of backgammon in my life, so I know what he was talking about with this whole Amazon business and this backgammon board game. So I literally had to like go search for everything and understand what they were. So that’s kind of how I came to learn about Amazon as a business.
Kevin King:
So this is what 2019, 2020, something like that.
Sumana:
This was 2020. So end of 2019 beginning of 2020. Actually, I think January 2020 is when all this kind of happened, and right before Covid you got into the board game business, where everybody has to stay at home and they’re bored. Yeah, no pun intended there yeah, and the funny thing was that was going to be a reason why I was not going to buy the business because I was too afraid that COVID, you know, was going to be one of those things where if I don’t have products to sell, what am I going to sell? My business is going to tank. So you know, because you know, just kind of just to think about that, I remember the conversation with the broker and I said, hey, you know, it was February and the first cases of COVID had hit US in the Washington state the nursing home, you know cases and I was like, oh my God, and China was actually talking about the shutdown and you know all of that. China was hit really bad and I was thinking I’m not gonna have any products to sell, like, how am I going to keep up with this? And he was like, Sumana, you’re you.
Sumana:
We have to understand it’s board games and, you know, if people are going to be stuck in the house, what would they rather do? They would be paying play board games. I, and for me my head, backgammon was not a big board game for me. Okay, if it was chess or some other board game that everybody knew in my mind that was going to be the big thing, since I didn’t know what backgammon was, right. So that’s really how it felt at that moment.
Kevin King:
So you bought it for $1.1 million. Did you use money from the sale of your other business? Or did you do financing or SBA? Or did you have some savings? Or was it owner finance? How did you maneuver that?
Sumana:
So I actually had not even sold my other business, I had just listed and started talking to, you know, buyers. But this business was pretty interesting so I did go for an SBA loan pretty interesting. So I did go for an SBA loan with a 10 down payment, so which was a big, big deal for us because we were like, you know, imagine that conversation with my husband, right. So it’s like, I don’t know what this business is. It’s supposed to be an Amazon business. I don’t know what that means. It’s a backgammon, it’s a product which I’ve never played a game of backgammon, but I’m ready to invest all of our life savings as a down payment for a 1.1 million dollars with our houses collateral. So that was the conversation and poor guy, my husband bless us, he’s such a supportive guy and he’s like, okay, go for it, go do what you want to do. And, yeah, ended up taking an SBA loan of $1.1 million plus $300,000 in inventory.
Kevin King:
Oh wow, so was it just? Was the only SKU backgammon, or were there other games or other SKUs in there too, or was backgammon just the main one?
Sumana:
Yeah, backgammon was it, and it was variations of the backgammon game, so different sizes and colors of the game.
Kevin King:
So, once you bought it, or did you start digging into, like, all right, how does this Amazon? Now that you know that Amazon doesn’t actually decide what to sell and they don’t have these big warehouses well, they have big warehouses but that everything’s not coming shipped by Amazon or decided by Amazon, once you kind of figure that out, how did you actually like, okay, now I got to figure out. How does this thing work? How do I ship stuff in? How do I sell these? Was the owner involved in teaching or did you go and just start digging around YouTube or go take a class, or what did you do?
Sumana:
Yeah, so the first time I really saw a seller central screen was the day after closing of the business. So the day after I paid the guy $1.1 million after closing of the business. So the day after I paid the guy $1.1 million. Wow, that was the first time and I would caution everybody who is listening if they’re first time doing this, please don’t do that. It worked out for me, thank God, but now I know all of the due diligence that I was supposed to do, which I didn’t do, but luckily you know this is something that they say right, don’t try this at home.
Kevin King:
Yeah, really don’t try. Everybody, don’t try this at home.
Sumana:
Yes, exactly, disclaimer. So, yeah, that was the first time I looked at it and then, once I started kind of looking at the screen, the way I did that was like I was clicking on every tag that was out there and if I didn’t know something I would like look at YouTube and if I, if YouTube did not have an answer, I would call this the previous owner and he was actually a lot of help. He was a great guy. We’re still good friends. He was so patient. He actually came and sat in my living room the day after. You know, the deal closed. Of course, he lives right here and not in South Carolina. I live in North Carolina. So he came, he and his wife came, sat down here in the living room and you know, kind of in one day, whatever he could cover and he kind of like covered. But I was like whoa, whoa, whoa. You know I had just gotten through you’re like what’s an acid?
Kevin King:
What’s a acid, what’s a ASIN? How do you say, say it.
Sumana:
Exactly. Oh my God. That was so funny because he was talking about ACOS and TACOS and initially, when he was talking about TACOS, I thought he was talking about food, maybe having lunch or something, and I was like what are we talking about here? So it was very today. When I think about it, I kind of laugh about it and at the same time I’m like what was I thinking, you know so?
Sumana:
But just kind of, that was, they did come and sit here and they went through a lot of things and for me, in my mind I had just gone through a whole stack of closing documents from the bank, right? So I had all of that going on. And then this one here I said at the end of the day, I just said, okay, you know what, thank you so much for showing me all this. I don’t think I got a lot of things, it just went over my head. So after he left, you know, of course, we had some consulting time put in the APM and we were closing. So I had about 30 hours to learn from the previous owner. So I think I might have utilized every minute of it and maybe more if he was.
Kevin King:
He was gracious enough to maybe spend more time with me so after you started running it, did you end up adding more products to it or just stick with this the same backgammon and variations?
Sumana:
So I didn’t have any time. I didn’t have any time to add anything else or do anything else, because as soon as I took over, the inventory that I got was supposed to last until October of that year. And you know, and I was told that I just needed to order one more container for that year to kind of for the holiday season and then I’ll be all good. But then, you know, I think, about a week and a half into having owned, you know, having owned that business, Covid started to really take effect and people were staying at home and I was selling out of products so fast that I was like, okay, by the time it’s June or July, I would be out of stock at that rate. So my first thought process was like I need to get more inventory. How do I get more inventory? So I had a video call with the supplier for the first time, and you know, and I was like what’s going on there? You know, hello, how are you? I’m Sumana, by the way, I’m the new owner, but I need more products. How do we do this? And she was like, well, we don’t know. We are shutting down our factory. All of our workers have gone to their villages. We have no idea when we are going to come back.
Sumana:
And I’m like, oh my God, this is it. I’m thinking, this is it, everything is over. Like I can’t make loan payments, I can’t do this. This is going to be very bad for the business. I’m going to be losing everything. That was my, you know, thought process at that moment. But then I asked like what do we do to get more products? And she’s like you can go ahead and place an order now and whenever we come back, it’s going to be first come, first serve, you know, and we’ll stop production of the first order and then we’ll just keep going. I was like okay, thank you, I’ll send you an email. And that night I was like okay, what do I do? Like, how do I do this? Because, first of all, money. Right, so I’m. I was just starting to the money. But then in my, in the back of my mind, wait, I had a 40 payment term with the supplier. I’m like, all I had to do was pay the 30 when they start the order. So next day morning I sent her an email with an excel spreadsheet of eight containers worth of orders.
Kevin King:
Wow, so yeah, typically we, you know the business not one, like you thought you might need for, but eight containers, holy cow, eight containers, eight containers.
Sumana:
So, holy cow, eight containers, eight containers. So actually she was very confused too, because typically this business was doing about three, at most max four containers in a whole year. And she was like, wait, this is in order for eight containers. Is this okay? Are you okay? And she was like do you know how to run this business? She was like I know you’re very new, but you know, you just gave me eight containers worth of, because each container held about 20 to 22 000 units wow of the board and off the board game.
Sumana:
So she was very confused as to like why I would send her in eight containers with order. And I just told her I said you know, when you come back, get started and keep sending me. As soon as you make, you know, each container, just keep shipping. And she was like, okay, if this is what you want to do and, like I said, she really thought I was crazy want to do. And, like I said, she really thought I was crazy. But luckily that was a saving grace because when they came back at the end of May, they started production on my containers. So another good thing that happened with this eight containers worth of orders is that everybody else who placed an order after me had to wait until my eight containers were done. So all of my competitors had to wait until my eight containers were shipped out, which was almost like September, October of that year, yeah, so, because they could only make one container per month.
Sumana:
That’s their capacity was about making really. Yeah, okay. So they were kind of like stuck making buying waters and you know all the other competitors had to wait. And when everybody else was out of stock for a holiday season and, like, I think by the time it was September, a lot of people were out of stock and I had stock all the way until following year, March, to go during that time.
Kevin King:
Did you ever run out of stock at all? While you’re waiting for these eight containers you were able to actually, did you have to raise your price or change something, or to keep it in stock, or what did you do?
Sumana:
Yeah, so I did raise the prices, you know a little bit, because at the end of the day it was supply and demand. And you know, since everybody was out of stock and they were raising the prices, you know, because they were going out of stock and I kept raising the prices, so we actually had raised the price to double of what I had bought it. Like when I acquired the business, what it was being sold, I had doubled the price on the products and we were still selling out. We were still selling out like crazy and I was like, oh my God, we were still selling out like crazy and I was like, oh my God, like I couldn’t.
Sumana:
The only, I think, the issue I had during that time was to get it fast enough into FBA. That you know because there was such a backlog and, like you know, things going on at the warehouses. That was the only situation where I think there might have been a few days here and there where we were kind of close to getting on stock. Sometimes I think we were out of stock for a couple of days and things like that just to kind of get them into the warehouses, because we had the stock in the States, we had the stock but we couldn’t get it fast enough into the FBA.
Kevin King:
How did you? You had to pay 30%. You had good terms, so that helped the 30% down 30% on shipment and 40%, I’m assuming, after it arrived, or something like that.
Sumana:
When it arrived on the port.
Kevin King:
So to order eight containers you had to cash flow. That I mean they’re not working. This is March, or February or March, and they’re not coming back until May, so did you have to put in the payment? That’s what? Five bucks a piece, or three, four or five bucks.
Sumana:
So here here’s the thing. So 30 when they started production on a container.
Kevin King:
So not until May. You didn’t have to pay that until May, okay.
Sumana:
Exactly, so that was also my idea was that first thing is I don’t have to pay anything until May. Even in May I have to pay 30 of the first container they’re going to start working on.
Kevin King:
Ah, okay, okay. All right. Did you negotiate that, or that’s just what that was just a given.
Sumana:
That was just a given that whenever they started production on one container, I would pay them 30 okay, okay, so you know they didn’t ask otherwise and I did not expect otherwise so that was my calculation too when I was giving them that eight containers worth of orders that was my calculation is that I have to pay 30%, then 30% when they ship. But I knew there was going to be some overlap there, because when they ship this I have to pay 30% of that, then I have to pay 30% on the next container. So I knew there was going to be a couple, like you know, like you know that’s smart.
Kevin King:
You locked so by placing a big order you locked up the, you locked out your competitors and you were able to cash flow it because you had current inventory that was generating sales. So you’re able to plow that money back in, not really take a whole lot out and just build this thing up to crazy numbers right and then you did a magic thing you bought something for 1.1 plus inventory and then you sold it for a crazy amount of money. Like what a year and a half later.
Sumana:
Yep. So before we go into that part of it, the other thing that I wanted to kind of mention with this whole eight containers uh situation was I also knew that I could slow down the production If sales slowed down.
Sumana:
Let’s say, Covid went away in three months or six months, I could also slow down the production and say, hey, you know what? I know you are going to send me back to back, to back all these containers. Go ahead and slow down a little bit and send me another container two months later. So they would have actually kind of said, oh okay, they would have actually taken a breather then, I think, made other you know products for other you know competitors and stuff. But that would have been fine by then. But that’s my idea was to just kind of go ahead and lock them in for the eight containers. But that’s my idea was to just kind of go ahead and lock them in for the eight containers.
Sumana:
And the other thing also I wanted to mention was when I calculated it and this was something that everybody kind of when I talked to they said why eight containers? Why you know what, if you had, let’s say, three containers sitting in the warehouse and you didn’t sell it fast enough.
Sumana:
I kind of mentioned to them that when I calculated it to store a unit of that game in warehouse it was costing me 12 cents per month because it was small, right. It was not very big but the same product if I did not have to sell, I was losing $20 in profits. So it was kind of you know the calculation there that I felt like a lot of times we kind of, when we are looking at inventory, like, oh my God, I don’t want to have too much inventory in my warehouse. But it’s just one of those things where if you have an, if you have inventory, you’re only paying about 12 to 20 cents per unit to store them, but if you don’t have your, your losing 10 to 30 dollars in profits. Yeah, you know, that’s kind of one of those, uh, one of those things, going into December of that year, since we had done so much sales and you know so, when I acquired this brand it was making $347,000 in SDE and by December we had already done $1.5 million in SDE.
Kevin King:
And were you taking any of that out for yourself or you plowed it back in and reinvesting?
Sumana:
I put it all back in because I was like you know what this is growing, let it keep growing. I’ll keep putting everything back in there. So we had a good, healthy inventory. By the time it was December. We had good inventory, we had great sales. It was doing about $1 million in revenues by December. It had done like $3.5 billion in revenue within that period that I had.
Sumana:
And so I started getting emails from aggregators who wanted to acquire the brand because this was the top brand it still is the top brand for backend. The review mode was crazy, the listing was great and the sales were great. So I started getting emails from aggregators in December and I was like, oh, this is interesting, people want to buy this. So that was actually. I was not even. I didn’t even have time to like sit and think about what’s next for the business.
Sumana:
But then when I started getting those emails, I actually picked up the phone and called the previous owner and since I said, like I said, he’s still a good friend I said what do you think? Do you think I should sell this business? And he was like ooh, that’s a good idea, I think you should explore it. And he was so great about that. He was like you know what’s mine, you should explore it, you should really kind of look into it. So I started like communicating with the aggregators myself, but then it felt a little kind of like too intense because they were asking me questions again. Remember I had just had this business for like 10 months.
Sumana:
Yeah, you’re still figuring it out, yeah, and I was still learning the jargons and, like you know, the whole ACOS and TACOS and stuff. I was just getting better at by the time. By the way, by the time I got comfortable with ACOS and TACOS and you know acronyms like that, they rolled out with ROAS. I’m like what the heck is this ROAS? I can learn everything about this ROAS. So you know, I was still in that state and when I started talking to aggregators I felt really uncomfortable because the questions they were asking me I didn’t know the right answers for those. So I decided to kind of reach out to some brokers. So the first broker I reached out to was the one that actually sold me the brand right.
Sumana:
So he was part of that. So I thought, okay, he knows the brand, he knows the business, he knows that you know where. Okay, he knows the brand, he knows the business, he knows that you know where it was, where it is today. Unfortunately, when I talked to him he didn’t really give me that sense of that. He believed in. Everything that I have done is what has scaled this business.
Sumana:
In his mind it’s like wait, why would somebody buy this business from you? Like they just, you just bought it for 1.1. And why would somebody want to buy it from you? But he’s like okay, but we can give it a try. You know, we can list it for 3.3 million. And I said, why 3.3 million? Like what’s the? You know? Because if we look at 3x multiple, it should be at least 4.5 because it’s making 1.5 million in SDA. But in his mind, because I bought it for 1.1, he took 3x from that and he said let’s list it for 3.3. For me, it did not. You know, kind of sit right, but he didn’t trust or he didn’t believe in in everything that I had done. You know, because I had also done a lot of PPC campaign adjustments and budget adjustments and so many things that scaled this, not just increasing the price or whatever. So I felt a little kind of like, okay, you don’t believe in this, so let me just talk to a couple more people. So I ended up talking to another broker from Twilight and another broker from Website Closers and one of them was like, oh, oh yeah, let’s list it for seven million dollars. I was like, okay, that’s too high. And then you know, uh, and then we had um quite like where they’re like okay, let’s list it for 5.5, let’s see what kind of offers we get and things like that. I was like, okay, I felt very comfortable talking to him. I said, okay, let’s do this. And we ended up listing it in January.
Kevin King:
So you hadn’t even owned it a year yet and you put it up for sale for 5.5 million that you bought it for, 1.1 plus inventory. So 5.5 plus inventory right correct, plus three containers or however much you had sitting there at 12 cents a unit uh, yep, yep, exactly so that’s exactly um, correct and uh, so we ended up listing it for sale.
Sumana:
Within the first week we had multiple, multiple interests and the first two weeks I took 14 zone calls with buyers who were seriously interested.
Kevin King:
And out of that 14, we got several offers. These are all aggregators or a mix of aggregators and other type of investors, people I spoke to as a mix of aggregators and individual wires but most aggressive were the um.
Sumana:
I forget selflessly.
Kevin King:
At that time I will lose and were any of them making raising the offer?
Sumana:
Yeah, yeah, we had a good bit of uh bidding war happening also, um, so we got um, several offers that were more than the asking price. But you know that was a different process. So once we had these offers, we kind of sat down and looked at who has the money on hand, who is giving us a good you know earn out and everything else you know, in addition to the asking price, and it just came down to who had the money on hand and who was going to close faster.
Sumana:
So, that’s really what it came down to, because I was like, okay, I don’t want to drag this for too long because, again, that was something I was not very comfortable with from the beginning. I was not comfortable with the whole setup because I had only bought it, I had not sold the business, so it was something that I just felt. I also listened to the broker, you know, and kind of made sure because he knew what he was doing, he had been selling businesses all the time, so, like, let’s listen to him. And he actually had an offer for 6.5 million but they were still the process of raising money and that was something that you know, even bro for and I, we both agreed that, okay, it’s not there, it’s you know, one bird is one bird and is better than you know out there kind of thing.
Sumana:
So that was the scenario. And then we, luckily, actually the aggregators that I sold to they were very, very nice people. One of them actually owned a backgammon set, and he was so excited. He was like oh my god, see this, I have it. I have this set. I’ve been using it for so long and you know, we love this, we really want it and we can do so much with it. And, and you know, that was kind of one of those things where I felt very comfortable to, because, at the end of the day, we had to continue talking.
Kevin King:
How much did you end up selling it for?
Sumana:
On the bidding war 5.5.
Kevin King:
Oh, you went to the 5.5? And then how much of that was cash up front to your bank account. How much of that was what percentage was earn out?
Sumana:
So I also rolled in equity. I kept 7.5 percent in that business because I also wanted to like, hey, I wanted to see where this was going to go, what was going to happen so after rolling in, I think, cash in the account was about 4.9 something. Again, it’s been a couple of years, so numbers-wise. But earn outs was not set number, it was percentage of the SD group in the following two years and yeah, that was kind of the SD group in the following two years and yeah, that was kind of, so as a banker, you used to log into bank accounts and see people with a 307 dollars and they’re taking out 306.
Kevin King:
So what was it like the day like after you signed the deal and like, okay, the deal is just closed. Are you still a Wells Fargo as your were? You did you so? Did you? When you logged into that Wells Fargo account, were you there with your husband and your daughters and you’re like look at this screen, it shows like 4.9. What was that like?
Sumana:
That really I knew.
Kevin King:
You’re like, oh my God, there’s too much money in that account. Get it out. Get it out. I know someone’s going to have access.
Sumana:
That is exactly what happened. We came into my office. I told my husband I’m like, let’s go log into the bank account. I know money will be there. Let’s go see this whole thing right. My daughter was not here. My older one was at college, my younger one was in school. So we came to the computer, locked in, looked at the account. We looked at each other, looked at the account, we looked at each other. I think we did that a few times and then we were like wait, let’s make that.
Sumana:
We could not imagine in our lifetime to have that, right, because and this is something a few people that know between me and my husband, when we came to this country, we came with $70 in our pocket. He came with $40 in his pocket. I came with $30 in our pocket. With a loan back home or back in India. I should have back in India for our flight tickets. We had to take a loan which we had to pay back. We hadn’t paid back. That’s how much we came here with for us to see that kind of numbers on the screen. We were just like. And then, of course, two minutes later, we’re like okay, this is too much money in one place. What do we do with it?
Kevin King:
You’re like how many nickels and how many dimes is that?
Sumana:
I know, right. Exactly, exactly. So we’re literally we’re like, okay, let’s pay off the mortgage, let, exactly. So we literally were like okay, let’s pay off the mortgage, let’s pay this, let’s do this, let’s do that. And we made a list of things. I think, within two days they were all like dispersed into different places, except for some you know a good bit of money here, because we didn’t know what other fees and everything was going to pay out of taxes, right?
Kevin King:
Yeah, calling up your daughters’ college. I want to prepay all four years now just send me the bill.
Sumana:
I’ll pay it all now exactly so out of the account. Yeah, that was a very interesting couple of days. I think, honestly, it’s just those two days. The first two days we were still kind of like not believing it. It was not even like thing that happened. We’re like okay. I think I must have logged in every one hour to check. I think the money was still there, you’re waking up at 4 am going on your phone in bed it’s still there.
Kevin King:
Exactly. What did you do to celebrate? Did you take a trip? Or did you go to a nice dinner, or did you do anything?
Sumana:
Yes, we did. We did go to a nice dinner. We actually had our family. My sister-in-law was here and my brother-in-law was here, so we all went out for dinner and I also. My husband’s birthday was coming up and our wedding anniversary, so I bought him a nice car.
Kevin King:
That was one of those things so you exited and then but now you’re doing all again, right. Then you turned around like, okay, that was easy. What’s that button you hit at Staples? That was easy, that little red button. Let me do this again. So then you ended up buying some more businesses and you turned around and you’ve already sold some of them, right.
Sumana:
So let me tell you this I really wanted to take a break. I really did, because the first time I wanted to take a break, when I sold the franchise, that didn’t happen because I ended up buying this business even before I sold the franchise. And then again, when I sold this business, I was like, okay, this is it, I’m not going to take a break, I’m going to take a break. I mean, I’m going to take a break, I’m not going to buy anything else, I’m just going to relax for the next at least six months to a year. Nope, that did not happen. Two months into it, I, you know, found out. Actually, the broker that sold my business, he was like, smart, have this great box for you if you want to buy. I was like, okay, let’s take a look at it. And I really liked it, went to a bidding board for that, but then backed off and then gave an offer and ended up getting that brand and I still have the. So I’ve acquired three brands since then. I still have the three brands.
Sumana:
2023 was a, I wouldn’t say a tough year, but a very different kind of year. 2023 was more of a personal growth year for me and I had to really kind of take some time to focus on that. There was a lot of confusion in my personal life, so that’s kind of took away from scaling these brands 2022, I did a good job. 2023, I did not do a great job. But now you know I’m actually getting ready to possibly list one of the brands that I’ve done okay with in maybe the next few months and exit out of that.
Kevin King:
And then you’re coming to BDSS in May to actually learn a couple of little tricks and a couple of little things. That’s going to help you even get more money out of it, right?
Sumana:
Absolutely 100%. I’m excited. I’m excited for Kauai. It’s a great place too. It’s too funny, because I ended up going to Kauai with my family in December. I did not even pay attention to where BDSS was going to be. I knew it was going to be in Hawaii, but I didn’t realize it was going to be in Kauai. So now I know exactly what all is there, where to go in Kauai, what to do. Of course, we’ll have every minute of it planned for us.
Kevin King:
So you’re going to have an advantage on the race because you’re going to be like oh, I know where that waterfall is, I know where this is. You want to be on if you’re listening to this and you’re going to Hawaii. You want to be on Sumana’s team.
Sumana:
I know, right. Let’s do that. Absolutely.
Kevin King:
I’m very excited we can keep talking, as we did on that couch for hours. We could probably keep talking here for hours, but I have to have you back on because there’s more stories that we got to tell. But we’ve been going for an hour here already. Can you believe it? It doesn’t even feel like it. So I really appreciate you coming on and sharing your story. It’s very inspirational and just shows what you can do in this business.
Kevin King:
It’s not always about the latest hacks or the latest whatever it’s having the right product and having the ability to think outside the box, like you did with eight, let me order eight containers, not realizing, maybe at the time, exactly how that was going to work out. But it worked out to your advantage by boxing out the competitors, and you made some really smart moves along the way. So you can’t say this was anybody that says, oh, she just lucked out at the start of COVID. That definitely helped the start. You know that. There’s no doubt that that helped. But you made some smart decisions along the way as you figured out your way, and I think that’s an important lesson that a lot of people should take from this.
Sumana:
Well, thank you so much, Kevin. I really, really appreciate you having me on this podcast, and one day you should let me interview you. I know you have a lot of great, great stories that I learned from you, so I think the audience will also appreciate hearing from you.
Kevin King:
Yeah, we’ll have to do that. That’s a good idea. That could be a good podcast, let the guest interview Kevin.
Sumana:
Perfect, perfect, sounds good.
Kevin King:
If people want to know more or learn about you or follow you are you on LinkedIn or anything? Or you just want to like stay to yourself, or what do you want to anything you want to share?
Sumana:
Sure, I’m on LinkedIn Sumana Sanjeeva, so and then Facebook, I do. I have actually talked to several, several people who are just starting out or they’re already, you know, into business but struggling somewhere. I kind of, you know, look at their brand and just kind of, you know, give them a couple of, because I also I still feel like I’m an outsider looking in, I still don’t think that I know everything, amazon, so kind of that kind of helps, because I always stay at the basic level. So, uh, you know, I kind of look at some of the brands. I’m like, oh, you know, we can do this or we can do that. I’m like, oh, yeah, they’re you know, that’s kind of something that I love to do. Um, so, if somebody wants to reach out to me, I’m always here. You can look up Sumana Sanjeeva.
Kevin King:
Awesome. Thanks again, Sumana, it’s been great.
Sumana:
Thank you so much, Kevin. You have a wonderful day.
Kevin King:
Sumana and I could have kept talking for hours, just like we did when we were hanging out outside a convention. She’s a lot of fun, really smart lady, really successful in what she’s doing, and that’s just an amazing story that I just had to share with everybody. So hopefully that gave you some inspiration and it’s gonna give you some motivation that this business can be awesome, as she is total proof of. We’ll be back again next week with another incredible episode of the AM/PM Podcast. Don’t forget, the Billion Dollar Seller Summit is coming up in Hawaii in just a little over a month or so. May 18th to the 23rd billiondollarsellersummit.com is the link if you want to get all the information. And before I go, I’ve got to leave you with some words of wisdom Master your past to master your future. Master your past to master your future. See you again next week.
Enjoy this episode? Want to be able to ask questions to Kevin King live in a small group with other 7 and 8-figure Amazon sellers? Join the Helium 10 Elite Mastermind and get monthly workshops, training, and networking calls with Kevin at h10.me/elite
Make sure to subscribe to the podcast on iTunes, Spotify, or wherever you listen to our podcast!
Want to absolutely start crushing it on eCommerce and make more money? Follow these steps for helpful resources to get started:
- Get the Ultimate Resource Guide from Kevin King for tools and services that he uses every day to dominate on Amazon!
- New to Selling on Amazon? Freedom Ticket offers the best tips, tricks, and strategies for beginners just starting out! Sign up for Freedom Ticket.
- Trying to Find a New Product? Get the most powerful Amazon product research tool in Black Box, available only at Helium 10! Start researching with Black Box.
- Want to Verify Your Product Idea? Use Xray in our Chrome extension to check how lucrative your next product idea is with over a dozen metrics of data! Download the Helium 10 Chrome Extension.
- The Ultimate Software Tool Suite for Amazon Sellers! Get more Helium 10 tools that can help you optimize your listings and increase sales for a low price! Sign up today!
- Does Amazon Owe YOU Money? Find Out for FREE! If you have been selling for over a year on Amazon, you may be owed money for lost or damaged inventory and not even know it. Get a FREE refund report to see how much you’re owed!
- Check out our other Amazon FBA podcasts including the Serious Sellers Podcast, as well as our Spanish and German versions!
- You can also listen to the AM/PM Podcast on YouTube here!