StartUp Beat

Web Site: www.biztrader.com

Headquarters: New York

Year Founded: 2008

Founder: Colby Sambrotto, CEO

Investors: Private Investors

Employees: 3

By Colby Sambrotto

Launched in April 2008, BizTrader.com is a global hub for business.  Users can buy, sell and value businesses, find value-added advice about all three processes, and get access to financial services and consulting.  Think of it as a global exchange for small business.  There are currently more than 25,000 businesses listed for sale on the site.

BizTrader.com’s wide range of services include Web 2.0 functionality such as video capability, mass listing syndication and distribution, RSS feeds, chat boards, and real-time, automated translation between English and Spanish.  This improves the ability for small business owners and buyers to easily connect on a global scale.

I founded BizTrader.com after serving as COO of ForSaleByOwner.com, the world’s largest resource for buying and selling real estate without a broker.

ForSaleByOwner.com was sold to Tribune in 2006 and after going through that process, I was inspired to start BizTrader.com to meet the needs of entrepreneurs and investors.  The company’s start up was funded by the original team of partners that created ForSaleByOwner.com.

At BizTrader, I am responsible for all executive and operational aspects of the business including overseeing business development, Web development and strategic planning.  We currently have three employees, and we utilize a team of more than 20 consultants domestically and abroad.  Over the course of the next few months we will make strategic hires in our business development area, and in marketing and sales.

Based on industry statistics that tell us only 25 percent of businesses for sale in a given year are actually sold for any of a variety of reasons, BizTrader.com has created a blended sales model, which enables owners to list their enterprises for a potential by-owner – no-commission sale.  Clients may reach out for the assistance of a professional broker if necessary should their by-owner sales efforts prove difficult or unsuccessful.

Significantly, our “blended” model offers owners a far better potential of selling their businesses than surprisingly abysmal industry averages.

According to the IRS, there are about 25 million small businesses in the U.S., which includes home businesses and very small businesses with no employees.  And of the 25 million approximately 5 to 6 million small businesses have one or more employees.

Our primary targets are those enterprises with at least one employee (5,547,000—of which 80.5 percent have annual sales of less than $1 million).  At any given point, it is estimated that as many as 20 percent of the owners of these enterprises are actively considering the sale of their businesses.  That’s roughly a million enterprises.

Significantly, only 25 percent of these enterprises (250,000) will sell in a given year and business brokers will be responsible for about 50 percent of that total.  The low level of success is most often blamed on owners overpricing their businesses—not the performance level of the brokers.

Almost unbelievably, 75 percent of the businesses for sale remain unsold every year while 90 percent of the potential buyers remain on the sidelines.

At BizTrader.com, we primarily derive our revenues from three sources:

All-Inclusive Listings – Priced at $49 Until Sold, enable sellers to highlight their ventures on BizTrader.com as well as numerous related sites.  Owners may attach up to six pictures of their ventures and use as many as 3,000 words to describe their ventures adequately;

Web Site Advertising – For entities such as financial institutions and franchisers who want to reach BizTrader’s sellers and buyers;

Exclusive “Blended” Broker Model – Brokers are able to list their client businesses-for-sale on the Web site for free.  Additionally and exclusively, BizTrader.com provides sellers the opportunity to seek the assistance of a professional broker should they encounter difficulties with their “by-owner” efforts.

In the blended model, owners needing help are directed to brokers who have contracted with BizTrader.com to serve the needs of prospect clients forwarded to them.  BizTrader is paid a “finder’s fee” of 10 percent of the total commission received by the broker should a sale eventually take place.  BizTrader’s management believes that there is an outstanding opportunity for a new player to address the deficiencies in the current market approaches, which fail to address the needs of the bulk of the marketplace.

Led by a seasoned, successful management team, BizTrader.com is moving aggressively into the businesses-for-sale industry with an array of new and unique tools for business owners and business brokers to help them sell effectively.

BizTrader – www.biztrader.com