Breakthroughs & InnovationsPodcasts

Can You Infringe on Someone’s Patent With Your Own?

By March 25, 2021
Ben Leonard

 

Ben LeonardBen Leonard is the Founder of Beast Gear, a fitness brand that was born out of a desire to train with the equipment we all need to reach our potential and BEAST our goals. Ben started the company with just his laptop and his spare time, growing it to an international 7-figure business before successfully exiting after 3 years. After selling to Thrasio, he was among the investor’s first acquisitions.

Ben now helps other entrepreneurs with their businesses through his e-commerce consultancy and brokerage firms, benleonard.pro and Ecom Brokers. He holds a Bachelor’s degree in Zoology and a Master’s in Ecology and Environmental Sustainability from the University of Aberdeen.

Here’s a glimpse of what you’ll learn:

  • Ben Leonard’s background and why he started Beast Gear
  • Ben talks about getting IP protection and how he ended up with an IP infringement lawsuit in Germany
  • What attorneys look at when handling cases of IP infringement and how a declaratory judgment action can help with patent infringement cases
  • The benefits of working with professional IP lawyers and obtaining IP protection
  • How IP protection helps entrepreneurs looking to sell and exit their businesses
  • How Ben sold his business and how he helps other entrepreneurs sell their businesses
  • Rich talks about Thrasio’s IP attorneys and their acquisition strategies
  • How to get in touch with Ben Leonard

In this episode…

Getting a patent is meant to protect the patent holder’s design for their product. A patent gives the holder an advantage over others who might want to use the same design to create their own products.

However, having a patent doesn’t mean that it’s impossible to infringe on someone else’s patent. There are situations where your registered design could be similar to what someone else had already patented—and this could lead to lawsuits being filed against you. In such cases, your intellectual property (IP) attorney must take the time to research and investigate further on the matter.

In this episode of the Innovations and Breakthroughs Podcast, Rich Goldstein is joined by Ben Leonard, the Founder of Beast Gear, to discuss how you can infringe on another person’s patent—even if you’ve registered your own. Ben shares his own experience dealing with an IP lawsuit and talks about the benefits of working with professional IP attorneys. He also talks about selling his business and how he helps other entrepreneurs through the process.

Resources Mentioned in this episode

Sponsor for this episode…

This episode is brought to you by Goldstein Patent Law, a firm that helps protect inventors’ ideas and products. They have advised and obtained patents for thousands of companies over the past 25 years. So if you’re a company that has a software, product, or design you want protected, you can go to https://goldsteinpatentlaw.com/. They have amazing free resources for learning more about the patent process.

You can email their team at [email protected] to explore if it’s a match to work together. Rich Goldstein has also written a book for the American Bar Association that explains in plain English how patents work, which is called ‘The ABA Consumer Guide to Obtaining a Patent.’


Rich (00:00):
Rich Goldstein here, host of the innovations and breakthroughs podcast by feature top leaders and the path they took to create change past guests include Joe Polish, Roland Frasier, and Mitch thrower. This episode is brought to you by my company, Goldstein patent law, but we help you to protect your ideas and products. We’ve advised and obtained patents for thousands of companies over the past 26 years. So if you’re a company that has software product or designing one protected, go to Goldstein patent law.com, where there are amazing free resources for learning about the patent process. And you could email my team at [email protected] to explore if it’s a match to work together. You could also check out the book I wrote for the American bar association that explains in plain English, how patents work it’s called the ABA consumer guide to obtaining a patent. I have with me here today. Ben Leonard Ben is the founder of his company, B skier, which is a fitness company that he started on his laptop at his spare time. He grew to an international seven figure business, and he’s successfully exited after three years. In fact, he sold it to thrash CEO and it was one of their first acquisitions. Uh, he now helps all those to do the same with their own brands, with his e-commerce consultancy and with his e-commerce brokerage. I’m pleased to welcome here today. Ben Leonard welcome Ben.

Ben (01:23):
Thanks rich. Really, really good to be here. Thanks for having me.

Rich (01:26):
Absolutely. So, you know, let’s talk about where you got started. I mean, we were talking a little bit, a moment ago about your background. I was a little surprised to hear that you, um, you are from Scotland. Um, and yet I did not detect an, uh, an accent. Um, we were talking about our common friend Keon who’s from Scotland who has, you know, a very discernible, um, um, Scottish accent. I was tempted there to try and better reflect that load, but yeah. So tell me about your background. Sure.

Ben (01:57):
I mean, I, you know, I don’t, I don’t know Ken personally, so can, if you’re listening, uh, hit me up. We should, we should catch up I’m from just up the road and Aberdeen. Um, so yeah, I’m, I’m an Aberdeen, although I was originally born in England, so my accent doesn’t give it away. Um, and we were saying before I had no background in business before I started, I was a fully qualified whale and dolphin nerd. My background is actually ecology. Um, and I stumbled into e-commerce in 2016. I, uh, I got really ill and, uh, I had a heart condition. Uh, it occurred for the third time and I’m absolutely fine now with this heart condition occurred. And, uh, I had to take a cocktail of drugs and, uh, not do very much for about nine months, so that may not have to give up my, my active hobbies.

Ben (02:43):
My fitness I’ll be. So I did a lot of CrossFit boxing, running, throwing words around scuba diving, and I needed something to do. Um, now my, my then girlfriend now wife was very busy studying and, um, she said, you know, why you do that idea you had for fitness brand? Um, a few years previously I’d been training. I think it was a CrossFit and the end of the session, somebody said, Oh yeah, we beasted it today. And I remember kind of thinking we beast, beast, beast gear, that will be a cool name for a fitness brand. And then I kind of forgot all about it until I got ill. I was cleaning out my gym bag and looking at all the stuff I couldn’t use and feeling pretty sad. And I thought, well, I could probably do a better job with that. So I started it really as a hobby to keep me in touch with my fitness hobbies without actually doing it. Um, maybe aren’t a bit of extra pocket money and, uh, yeah, as you said in the intro, it kind of grew arms and legs and, uh, three and a half years later, I’d drawn it to mid seven figures and I, I sold. Hmm,

Rich (03:46):
Wow. Excellent. I mean, that, that is, uh, you know, the Holy grail right. Is to, is to take, uh, take a business, grow it, and then, and then exit. Um, and, um, and, and that’s, that’s amazing. Uh, and so, um, you know, but along the way though, you did have an IP issue come up. Did you know? And, um, uh, I mean, it sounds like, um, you know, first of all, um, you know, I’ll, I’ll tell part of the story, um, and, uh, and then we could continue and you can tell more and more, it sounds like you, you had a, um, um, you, you know, you ha you, you got a registered design, um, in the UK, um, and essentially like, like the, the laws are different in different countries about protecting, um, IP protecting designs. There are, um, there are design patents in the U S there are things called registered designs in the UK, um, different procedures, um, and, um, kind of different criteria for them.

Rich (04:53):
Um, but, but there’s just one little lesson I want to highlight here. Um, which is that. So he, um, so Ben got his, um, design protection, um, and, um, at some later point, someone said like, Hey, you’re infringing my design, you’re infringing my design patent. So there’s just a few little, um, like learning points there that I want to point out to the audience. One is people often think that getting a patent means that you cannot be infringing all the people’s patents. Um, it is absolutely possible for you to infringe and all the patent, even though you were granted a patent and people often wonder how that could be. It’s like, well, if I’m different enough to get my own patent, doesn’t that mean I’m different enough that I’m not infringing and it just doesn’t work by the same principles. It gets kind of complicated.

Rich (05:45):
But, um, so that’s one thing to keep in mind is you always have to have your attention on whether you’re infringing, um, and Ben, his case. He really wasn’t infringing. Um, but, um, but that might be the first thing that comes to mind for a lot of people. It’s like, wait, you got your patent. What do you mean? Someone saying that you’re infringing? How could they do that? It is possible to be infringing someone else’s patent. Um, even if you get your own design patent or design protection, again, not in this case, but I just wanted to highlight that point. So essentially Ben, you’re, you’re going along with your product you’re doing really well. Um, and then, um, and then suddenly a competitor gets in touch with you. Tell me about that.

Ben (06:27):
Yeah. So this was product three, four, maybe five of the range. I grew it to quite a few products in the end, but the brand was going quite nicely. I’d had this idea for a product which performed the same function as something that already existed, but was not going to be the same design was not going to look exactly the same. And I presented my ideas to a professional product designer who made the drawings. We had a mold made, we created the prototypes. I liked it all. If we went at the same time, I’d already had my trademarks done by a reputable intellectual property attorney. So I approached them and they put B uh, to their, uh, patents and, and design registration specialist. And we protected the design across the UK, Europe and Australia at the time. And my product really began to take off both on my own website and on Amazon in the UK and across Europe so much so that the, the most popular product of this type, which performed this function, um, was, was previously selling for, you know, probably 50 pounds.

Ben (07:43):
Uh, and I, I put my, my, I had listed my product for a much more sensible price. I was still making a very fair margin of more like 20, 25 pounds, and they’d have to drastically drop their price to try and keep up with me. Um, and we were becoming the leader in this space. And so it was a really, quite a shock to me when I received first, the first indication that I knew something was wrong was when Amazon suspended my product, uh, not my account, just the product for a, a, an intellectual property violation at first of all, this happened in the UK, and then it happened in Germany. And, uh, the first thing I did this was before I’d received any, any letters or anything. But the first thing I did was I simply went into Amazon, responded to the case with a copy of my design registration, and immediately my product was reinstated.

Ben (08:39):
And the interesting thing to think about that is that relates to the point you made a few minutes ago, which is just because you have a design registration or painted. It doesn’t mean you’re not infringing on somebody else’s. And so it was clear to me that the people in Amazon’s intellectual property department didn’t know the first thing about intellectual property, because I may well have still been infringing on their intellectual property, just cause I had my own registration. Right. They clearly didn’t know that. So they thought that was fine. They reinstated me next day. I was, I was down again because their lawyers had written to them and explained that, um, no, no, no, I’m still Ben still infringing. So finally, a couple of days later, the letters arrived in German because I was selling this product in Germany. The very large, uh, uh, owner of this brand knew who I was, they’d done their homework. They knew I was a one person operation. Um, they wanted to threaten and bully me out of business. They, I, they was very obvious from their approach that they had experienced in doing this. So they, they wrote all their letters in German through a German attorney to make it as difficult as possible for me, they knew I was selling in the UK

Rich (09:49):
And they also did their homework. And they knew that you failed German in high school.

Ben (09:53):
Absolutely. Yeah, I have absolutely.

Rich (09:58):
We, we did our homework. We’re going to make it as hard as possible for him now. Just teasing. Of course. Yeah, no that’s but that’s pretty much

Ben (10:05):
What happens though. Right? So you can imagine you’re one small one person on a business you’re doing this, you know, as a hobby part time. Um, and, uh, it’s, it’s, it’s worrying, right? So sled arrives in the mail. First thing I do is speak to my, uh, attorney, my intellectual property attorney. And she says, Hmm, you may, you may be in trouble here, but we’ll do our we’ll we’ll, we’ll, we’re going to do our research. So after quite, quite a long time, few weeks, to be honest of, of trying to, first of all, figure out whether I, I really was infringing on their design registration.

Ben (10:47):
Um, and so all this time, I, part of this is suspended on Amazon, right? I’m not making any money off of it. And I’m, uh, I’m pretty worried. We’re trying to, first of all, find out whether there was any indication that their products or anything like their product was in the public domain before they registered their registered design or even their us patent. Um, and we didn’t come up, come up with much luck there. But what we realized was that actually, um, my product wasn’t after all infringing on their, uh, design registration or their U S patents, not that I was selling in the U S and this was a case with this particular product, right? This product had been there. You know, this competitor product had been designed by, you know, an entrepreneur not dissimilar from me, um, in the U S and further down the line, he’d sold his business to, uh, to a large organization. And so this large organization had inherited the original patents and design registrations, right. Which were fairly poorly put together drawings. And to the very, very trained I have my design attorney or my intellectual property attorney, we, we discovered that first of all, I wasn’t infringing on their patent. Um, which w you know, my partner was just doesn’t look anything like this, but they were just upset that my head, I designed a better product, and they were upset about it basically. And my product was, was becoming the market leader. Yeah.

Rich (12:21):
And, and so just to give a little synopsis of kind of like what you’ve been describing, what’s been going on here, um, my own encapsulation of it. So essentially, like you are shut down and, um, you know, as time goes by, it’s like, you’re losing sales. Like every single day, the product’s not selling, you’re losing sales, but what his attorney was doing is they were doing the homework on the patent that he’s being accused on. And so they’re looking at two aspects of it. They’re looking at whether infringement is really present. And they’re also looking at, um, issues regarding validity, like whether the patent itself is valid. And so any time that someone is questioning, whether you’re infringing a patent, like those are the things to do. Like a lot of times, like Amazon sellers want to do is they want to shoot from the hip.

Rich (13:12):
They sometimes they’ll hire like a firm that’s used to dealing with IP, come with with complaints of all kinds like about listings. And so, like, there are people that just, they just launch right into letter writing mode, and they’ll just write a letter to, we get, we get accounts restored, and we get people back on, like for all kinds of issues and allegations of fraud and what have you, that’s their specialty, but what Ben did, which really set him apart in this. Um, and what has attorneys did, first of all, he valued the, what the attorneys were about to do, and what the attorneys did is they realized that these cases are won through homework. These cases are won by digging to, to find out the truth of whether you’re really infringing and like get underneath the patent itself. Because often there are issues about whether that patent should have even been granted.

Rich (14:07):
So, um, you know, just a little, um, little aside here on that is that, um, I don’t typically get involved in these types of disputes. Um, but the ones that I have I’ve won every single one of them, because it was all about just digging in and doing the homework and finding, finding those issues and then making it black and white, because for Amazon, for example, like for reinstatement, they don’t want to deal with shades of gray. They don’t want to hear arguments about like, well, mine is a little bit more curved, or there’s a little bit different about the shape of the handle, right? They just want something that’s just completely clear. Like you, you can’t possibly dispute that. Absolutely. There’s no way you could be infringing. So what, what Ben’s lawyers did is they dug into the history of the patent and they found clear issues. They found clear issues with why it was likely invalid, or at least possibly invalid. And then they found the reasons why he would not be infringing. And that’s critical to how these cases are won. So then Ben continue,

Ben (15:17):
Or I’m glad you, you put that in there because first of all, you, you know, when it comes to, uh, intellectual property, despite having been through this experience, of course, I am still very much a lay person, and it’s great to hear it translated into, like, what, what does that actually mean? And I’m really glad you mentioned about the kind of, um, the firms who just they’re there they go straight for the juggler with writing letters. Um, my, uh, intellectual property attorney had practically no experience of dealing with Amazon. That didn’t matter what they were, was fantastic attorneys who knew what they were doing and knew that they had to be, we have to be patient take our time, get it right. Because whether it doesn’t matter whether you’re dealing with Amazon or whoever you got to get it right. So we discovered that AI was not infringing on their design registration, but B because of the quality of their display design registration were actually very poor.

Ben (16:16):
The design registration did not actually tally with the product they were selling. In other words, their own design registration, and indeed the us patent, which they’d been relying on for getting on for two decades, uh, didn’t actually protect the part that they were selling. So after some back and forth, um, in a mixture of English and German, all of which by the way, was being relayed back to their, their client who was not German. It was actually in North America. Um, we were able to say, look, first of all, Ben’s parked is not infringing on your design registration. And second of all, your design registration, doesn’t actually protect the product you’re selling. So unless you would like us to actually take this further and have your design registration invalidated, we suggest you a leave Ben alone, B pay his legal fees and see reimburse him for the revenue loss, from his product being suspended on Amazon. And that worked in his so far as they left me alone. And my product went on to become the leader. Unfortunately, I didn’t get my legal fees back and I didn’t recover any my loss costs. So I lost, you know, tens of thousands of pounds. Um, however, uh, the fact of the matter is I won and that felt really good because I was, um, at that time I was running the business on a laptop in a cupboard in my apartment. And, uh, I felt like a David versus Goliath event. Yeah,

Rich (17:50):
No, that’s, that’s amazing. That’s awesome. Um, and, and again, just to encapsulate some of that too. So, so in the end, his response to their attorneys, um, this is a few things to highlight about that is like, you know, number one is that it, it pointed out the fact that if he wanted to, he could have actually brought an action to clarify the fact that he’s not infringing and that, um, the patent is invalid, right? So people like, think about this notion of a cease and desist letter as like something that they w they would throw around Willy nilly. I mean, it’s like, Hey, you know, I can’t afford to litigate, but I can’t afford a thousand dollars to hire an attorney to write a letter, a cease and desist letter for me, what they don’t realize is that when you send that letter, the other side can turn around and Sue you, they can Sue you for what’s called declaratory judgment and varies by jurisdiction.

Rich (18:49):
I don’t know what the law is in the UK, but it sounds similar in that, like, the person that you’re threatening has a right to clarify whether you’re really infringing or not, rather than have you just hold this threat over their head. Like if they are businesses going on and they’re making product, they’re about to order more products, you know, they need to know that a year from now, you are not going to turn around and Sue them for damages over all of the products they’ve sold over this past year. So that right. To clarify the issue once you’ve been threatened through what’s called a declaratory judgment action is a significant counter threat that you can, that can be made. And it’s also a reason why you have to consider carefully and, and, and word carefully. If you’re going to send the cease and desist letter, you don’t want to just like, like, look at that as like, well, I can only afford a letter, so I’ll do that.

Rich (19:43):
Cause you might get roped into a hundred thousand dollar or a million dollar lawsuit if you send that letter. So that’s one thing, um, also to point out, um, you know, Ben Ben’s attorney asked them for damages, um, and it’s perfectly reasonable that if someone unfairly shuts down your listing, that they’ll liable to you for damages, the question is, is it worth spending the money to go after them and collect? Um, I mean, we’ve actually successfully gotten people to pay damages when they realized that they made a big mistake by shutting us down without any justification. Like it was so black and white that they were wrong, um, that, that we were able to, to get them to agree, to pay significant damages, um, to our client who was unfairly shut down. Um, so at the very least in this case, it was a reasonable thing for Ben’s lawyers to do, to, um, you know, to, to, to ask for them to pay his, his fees.

Rich (20:47):
And they didn’t know for sure whether he would take that action to bring that declaratory judgment action. They’ll go after them for damages. And then that’s the chess game that happens in any of this, these litigation situations. And, and again, it’s often not worth, you know, it’s not worth the money to, to have to bring an action to compel it, but it was a strong enough threat. All of that put together that they went away with their tail between their legs and, um, and he never heard from them again. So, you know, there’s some serious tactics in how this was handled and I, you know, I give his attorneys an A-plus for, um, for what the Benz described that they did. And I think there’s just a lot for everyone here to learn from. So that’s an excellent, excellent story about IP and, and strategically using, um, using it and, and, and using lawyers at the right time to carry the day.

Ben (21:46):
I was lucky because, um, so I, I stumbled upon my IP lawyer as initially because, uh, over here, um, there’s kind of like a, there’s a thing called Scottish enterprise, which is it’s, it’s, it’s linked to the government, but it’s not political. And it’s a, it’s, it’s an, an arm which, uh, uh, helps small, medium business, most small, medium sized businesses. And they provide advice and guidance. It was them initially who pointed me in the direction of this, um, uh, intellectual property attorney, because this intellectual property attorney actually does, um, free consultant at the local library for people starting up a business. And so the year I started up, they helped me. They gave me some advice about, uh, getting my trademarks done. Then when I had a bit of money, they actually did more trademarks for me. And then when I had a bit more money, they did my design registrations.

Ben (22:42):
So if I hadn’t stumbled into that, I could have been in a lot more trouble than I ended up being in. I think, you know, the moral of the story, there is a lot of people in e-commerce don’t do this is have a defensive IP strategy from the get go, like before you do anything, get your trademarks and get your, your designs protected. I see it on the forums, on the Facebook groups all the time. People say I’ve just been quoted this much money to, um, to get my trademarks done. And in the UK, people will reply saying, well, just go to the intellectual property office and pay 200 pounds and do it yourself. I just cannot. I mean, I get the, I get bootstrapping your business. I’m a big fan of bootstrapping businesses, but for some things just, don’t be silly if you just get it done by a professional, please, because otherwise you’re going to pay down the line.

Rich (23:32):
Yeah. Um, absolutely. And, uh, you know, I think the interesting thing there too, is what what’s important is the strategy, you know, I mean, there are, um, it’s like people have their attention on the wrong thing with that. It’s like, I see companies even venture back companies going and like saying, okay, we’ve got these 10 patents to file. And then they find a firm that gives them what they think is a fair deal to file those 10 patents. And, you know, in software space, they could be spending a couple of hundred thousand dollars on those patents. Um, but what they don’t look at is should they be filing these 10? And when I look at it, sometimes I’ll say, yeah, you filed the wrong 10. There was actually three that you should’ve filed. And those three do not overlap with the 10 that you actually did.

Rich (24:21):
So in essence, you wasted a few hundred thousand dollars on patents because you went for like, yeah, like we need, like, you already thought you knew what you needed. And, and to me, it’s like the IP strategy is the biggest piece. And, um, and for me, like, I see that as Mo the most important thing that I do, like, you know, I think that, um, you know, I mean, personally that I’m in like the 90 something, 1990 fifth percentile in terms of ability to actually write a patent application. But that aside that’s not even that that’s not even the reason why I feel it’s important for people to work with me. It’s like, it’s the strategy in the beginning? Like, it’s just steering the ship. Like, even if I didn’t do the patents, it’s, it’s like, it’s like just knowing the right thing to do to protect yourself at the, that the right stage of your business. Like, that’s, you know, that’s where I feel. I earned my, my, my pay, you know, and it’s, um, it’s funny how many people overlook that.

Ben (25:25):
Yeah. Or, or guests, instead of just asking and paying for someone who knows, you know, um, right. Then they, you know, they don’t have to worry about it. They know they’re covered cause the experts sorted out for them and they can concentrate on what they’re best at.

Rich (25:42):
Yup. Exactly. Exactly. And I think like, that’s the thing is just like steering the ship and setting the strategy is like the most important thing in it. And like people put their attention on something like when, you know, like legal zoom will file a patent application for a few hundred dollars. Yeah. But it might not be the patent application that you need. And, um, you know, like just, just today, like there was a, a client who, um, like they just had in mind, like, look, all I need is I need to, to file this three class trademark application. And, um, that’s where their attention was on. But you know, when we looked at it and when I went over with my colleague, Julian, we, we decided like, you know what? This one class is never going to make it. It’s going to sink your entire application.

Rich (26:27):
This other class, it’s not ready to be filed because you don’t have appropriate specimens. You’re not using it in the right way that would satisfy the, the trademark office. Um, and then this one is good to go. So let’s split it let’s file applications, um, on different basis. And then therefore the one, the one class is not going to sink the whole application. The other, one’s not going to hold back the one that’s ready to go from issuing. And then the one in the middle, essentially it can, um, like we can do what we need to, to get that ready to be approved. So it’s just like that kind of like steering the ship, but like just a conversation between me and my colleague, um, you know, like we’ve figured out that strategy and it changed the entire course of what this person would have done with their trademark and how the next year would have unfolded for them in terms of their battle to get the trademark. So, yeah. Big advocate of strategy. I’m glad you see that. I mean, I’m just, usually, it’s like, I’m preaching, like, you know, here I’m know I’m preaching to the choir, but often when I’m talking about this stuff, it’s like, yeah, of course you’re a tr you’re, you’re a patent and trademark lawyer. So of course you’d say that, but like, you know, it’s, it’s just, it’s something I’m passionate about. I’m glad that you get it too, you know?

Ben (27:44):
Yeah. Uh, you know, the number of times I talked to, um, whether it’s just people I’m having a chat with on like a Facebook group or whether it’s, you know, um, mentees that I’m working with and, and they’re so, uh, I, you know, I get it because I was like that too, that, um, that they don’t want to spend any more money than they have to. Right. And they think, what can I do myself? What can I do it cheaper? Do I really need this? It’s like, well,

Rich (28:09):
I had a guy in five or I got the fiber guy working on my pad.

Ben (28:13):
Do you imagine? Can I go to Fiverr? Yeah. And it’s not just about, like, in case you get sued because on the balance of probabilities, you probably won’t. But when it comes to trying to exit your business, somebody is only going to buy it when they do their due diligence. If, if you’ve got all your ducks in a row, right. You’re not if your intellectual property isn’t right. Well, it’s, nobody wants to take on that liability. So get that done straight off the bat.

Rich (28:40):
Absolutely. A hundred percent. And speaking of which, so speaking of like of when it’s time to sell, so a really awesome thing, and I think we ought to highlight here too, is that you, um, you sold your business to THRASS you, um, and, um, this is just like a huge opportunity right now for brands. I mean, people have been launching brands on Amazon because they realized that they can have a nice business and profit from it, but something interesting that’s been happening over the last few years is that there’s been a ton of money being invested into acquiring these brands. Like, um, you know, like there’s institutional money, like, you know, big universities have endowments, like billions of dollars to invest in whatever. And so e-commerce brands has attracted the interest of even institutional money. And so you’ve got company like [inaudible], which kind of, I think the fastest company to a billion dollar valuation in history, um, I’ve heard like they’ve raised, um, I don’t want to get the numbers right.

Rich (29:45):
But it’s approximately like they, they raised a billion dollars to acquire other e-commerce brands. And I can’t tell you how many people I know that have had their brands acquired, um, in this way. Um, and so it’s like you can build a business and have it acquired. And, um, you know, you will one of the first acquisitions or the first acquisition of three S three SEO. Um, and, um, and so since then you’ve been helping people to not only grow their own brands, but then also to broker, to companies that would acquire them. So let’s talk about that.

Ben (30:24):
Sure. Yeah. So, so I was, I wasn’t their first acquisition, but I was one of the first in Europe. Um, and when I sold, I made the decision to sell in early 2019 and the deal was done, uh, kind of late 2019. And I approached that at this point, right. You know, it’s February, 2019. I have decided to sell, I haven’t heard of thoracic or I haven’t heard of any other aggregators in this space. And the, the idea of, of being able to sell an e-commerce business, like this is relatively new. Um, so I went to a broker and I’m glad I did because they introduced me to the buyer as it is, as you say throughout. So you and I can say that because they use me in their PR, um, and they’re good guys. Um, but I went, so I went to a broker and, you know, in his insofar, as they introduced me to a buyer that they did a good job.

Ben (31:10):
Um, and they’re good. They’re, they’re good guys. They’re a couple of things happened in the process of, of them doing what they do. Um, uh, and, and they did, they didn’t do a great deal more than just kind of that introduced me to the buyer. And I, on the other hand, did a great deal of work. And the, um, my accountant, uh, did a great deal of work to get the business ready to sell. And so after selling, we put our heads together and assessment, we could do a better job of this. Um, so we, we created e-comm brokers. Um, and the difference with us is, well, first we’re in the UK, uh, although we’re operating globally, but we’re in a nice little space here in the UK and Europe, because there’s no one else really doing this. Um, and so what we, what we kind of bring something different to the table where most of the other brokers are really just kind of bringing, selling, you know, shovels to the gold rush.

Ben (31:59):
Um, and don’t really have the lived experience of, you know, putting your heart and soul and blood, sweat, and tears into your e-commerce business and crying down the phone to sell the support at 3:00 AM. And they don’t have Alison my co-founder experience of 20 plus years in mergers and acquisitions, and, um, her experience as an e-commerce specialist accountant. So we’re able to work with businesses who they might want to sell now, but we’ll work with them particularly on the accounting side, but also on the e-commerce operations side to really get them ready to sell and see them realize a much higher valuation than they otherwise would. If they went direct to a buyer, he was obviously gonna offer them the lowest they possibly can or went to kind of a normal broker. Who’s really just kind of a middleman, um, or will work with people who might want to sell further down the line six months, a year or two years.

Ben (32:49):
Um, and we’ll kind of, uh, get we’ll rebuild them from the ground up, getting positioned perfectly in the right way. And I like to say, we’ll get them built to sell, um, you know, with all the, the, the, the, the proper way of doing things, particularly from accounting point of view, you know, we’ll properly calculate their seller’s discretionary earnings properly, do their add backs, get them a really good deal structure. And, and, you know, the most important one I think is finding the right buyer, because you mentioned before, there’s so many people coming into the space to buy businesses. Unfortunately, a lot of them, they know a great deal about raising money, but they’d know, diddly squat about running a business or running an e-commerce business. Um, and so we find, we, we make sure we find the right buyer because so much for the seller in terms of their reimbursement, for selling their business depends on the year net.

Ben (33:37):
And so we don’t want to be selling a brand to, to a buyer who, who, who is not the right buyer for that particular type of brand or product. So that’s something that we do very carefully. So, yeah. Um, we, we, I started the brokerage, um, which links in very nicely to kind of my mentoring, some of my mentees and go on to sell their business through that. Um, and I just kind of love doing this. So, um, you know, I love this e-commerce space. I’m still building brands in it myself. Um, and, you know, the exit was obviously, you know, an extremely exciting, exciting time when I went for my business and I’m glad to help other people with that.

Rich (34:15):
Exactly. And, you know, that’s, that’s amazing. And, um, and so it sounds like from the experience that you had with, um, with your own exit, you kind of learned how to help brands to, um, well, to not only grow their business, what you do with part of your, um, part of your business with your agency, but you also help them to position themselves better for exit and get things lined up, um, to have an exit that was kind of like to, to, to have even a better experience than you had with your exit. And that’s, so that’s, that’s amazing. Um, and you know, another thing you had mentioned earlier, I want to throw in here, um, we’re running, running out of time, but I wanted to throw in here too, that you’re, that you’ve been kind of building, building another brand of your own. Um, and so essentially, I guess one of the things that you mentioned, which really resonated with me is that it’s kind of like, you’re keeping the, the, the saw shop by, um, you’re working with other brands, but by working on your own brand at the same time, it’s kind of constantly keeping you in the game to keep your, um, your tools sharp in terms of, of how to help them.

Rich (35:25):
Um, and I think that’s, that’s super. Yeah.

Ben (35:28):
Yeah. Well, yeah, that’s right. I can’t very well consult with other people or mentor other people. Um, if I’m not, you know, still in touch with this, uh, industry myself, so yeah. I’m still building new brands, partly because I love it. And partly because I need to still have skin in the game.

Rich (35:42):
Yeah, absolutely. And I just wanted to quickly highlight something too, that you mentioned. And when you’re talking about like, you know, some of the companies acquiring businesses don’t really know how to run an e-commerce brand and some, um, some do. And, um, then it just, he has an interesting point. There was, um, a room on clubhouse with some of the, the founders and, um, main people at three Casio, um, a couple of weeks ago. And, you know, they mentioned the fact that I think he said they have five IP attorneys on staff at thrash CEO, which is incredible, which means like, you know, they, you know, it means two things. I mean, first of all, it’s, that means that they know how to run a, like, to, to run a brand and to handle those, um, those complaints and those issues internally rapidly. Um, but also it shows that like in the due diligence, in buying acquiring a brand, you know, you need to have your, your, your I’s dotted and your T’s crossed because the company that’s, that’s serious about acquiring brands, they’re spending a lot of, um, energy and they have a lot of attention on, on the IP.

Rich (36:54):
And so it’s just another reason dot the I’s and cross the T’s. And, and just, again, find a point like, you know, in terms of you mentioning how important is company acquiring, um, knows how to run a brand. I mean, you said they’ve got a great team over there. They’ve got like Casey, Casey Goss over there who, you know, from viral launch, like they’re like some of the people they have over there, it’s kind of kinda nuts. Um, I’m a big fan of those guys and yeah.

Ben (37:23):
Uh, I had a call today with the beast gears, new brand manager on they’re awesome. And, you know, they’ve hired so many people now that they have, you know, if you take the number of brands they’ve acquired and the number of staff they’ve called, they’ve got like six or seven staff per brand. Um, so yes, they don’t. When I, when I mentioned before, some of these, these guys don’t know what they’re doing yet, thrusts, you know what they’re doing, but a lot of the copycats, they know how to raise money. Unfortunately they don’t know how to run an e-commerce business and they’re struggling to hire the talent because all the talent knows that the best way to make money in this game is actually selling your own brand and not work for someone else.

Rich (37:54):
Right? No, absolutely. Absolutely. This is awesome. And so people want to want to learn more about you get in touch with you, you know, talk to you about, um, about, uh, helping them with their brands or, uh, or with brokering a business. How do they go about getting in touch with you?

Ben (38:12):
Well, I’m on all the main social networks. Uh, my handle is Ben Leonard pro, and you can get me on LinkedIn. Um, my website for if you want consulting with your e-commerce business to help me help you scale it up. Um, my website is Ben leonard.pro L E O N a R D. And if you want to talk about getting your, your brand ready to exit, whether it’s now or down the line, uh, go to e-com brokers dot Coda UK. So UK domain, but we operate globally,

Rich (38:38):
Right? Yeah. Fantastic conversation. I really appreciate you being here. Thanks so much, Ben.

Ben (38:44):
Thanks for having me rich. It’s been really nice. Cheers.