Buying Back the Brand - The Story of Beast Gear with Ben Leonard

Buying Back the Brand - The Story of Beast Gear with Ben Leonard Speaker 1: Hey guys, welcome back to Seller Sessions today. Joining me in the studio for a change is Ben Leonard. He's just flown in from Scotland, from sunny Scotland and he's here for a day or so and today we're going to be talking about saying I'm not sure much has been discussed before, which is the process of buying back a brand. Ben is well known in the industry for his brand, Beast Gear, which he sold a few years ago and he's just acquired it back. We're going to talk about that today and some of the benefits and how to go about it and put a bit of a timeline around it. Ben, welcome to the show. Speaker 2: Good to be here. Thanks for having me. Speaker 1: So tell me how this all come about. I mean, for you guys listening out there, if you want to listen to Ben's life after exit, cover a lot of stuff from the exit process. So you can go back and do a search on SellerSessions.com, but sorry for breaking the event. How did this all come about for you? Speaker 2: Yeah. The whole aggregator model has been well documented on LinkedIn, on Twitter, all over YouTube, as to the fact that some of these aggregators haven't necessarily done a tremendous job with the brands that they've bought. And I sold my brand in 2019. It was well documented at the time. It was the first European acquisition by the big aggregator that emerged at the time that was leading the way. And I just kind of watched very sadly as the brand got degraded. And when I say brand, I don't just mean the business. I mean the brand, the brand identity, the soul of the business was eroded. And in I think late 2023, it became public knowledge that the owner of the brand that I bought back was struggling and they entered something called Chapter 11 bankruptcy, which basically means restructuring. In the UK, we'd probably call it administration. And I contacted them at that time and said, hey, there's a world existing which I can buy this brand back. And of course, that was quite a long time ago and I've only just bought the brand back. So a lot of things happened that we can perhaps unpack between then and now, but that's what got the ball rolling. Speaker 1: All right. So let's break it down. When was this? What timeline around it? When did the process start? And how did you engage with the buyback and just go through the steps? Speaker 2: Yeah, sure. Quite simply, opened up my inbox, ran a search for the people I was working with when I sold the brand. And I dropped them an email. And I just said, hey, how could this look? Could we make this happen? And in the first instance, I got nowhere. Mostly because I think everyone in that organization was kind of running around like a headless chicken at the time, worrying that the sky was going to fall on their heads because things were not going well. And eventually, I got routed to their new head of mergers and acquisitions who wasn't there at the time that I sold the business. And they made it clear to me that they did not want to sell. At that time, they owned just over 200 brands. And yeah, they were in trouble, but they believed that they could get out of it. And it was not part of their strategy to sell a brand back to its owner. I think they'd sold one brand back to it somewhere. The time that we're recording this in January 2025, they now have fewer than 50 brands. And they've sold, you know, caught 150 more than that, probably 160 or 170 brands as they've had to rapidly downsize. So that just shows you how badly the situation there deteriorated. Speaker 1: Was it that they sold them or was it they literally have to offload them? Speaker 2: Yeah, they haven't really had much of a choice. In the end, what's happened is They have not been selling brands back bit by bit to former owners. I think there's a few reasons behind that. But first of all, that would just be very difficult undertaking to do. Second of all, many former owners just don't have the appetite to buy their brand back. They don't want to. They've moved on. Also, it's in such a mess now that they're not really in a position to try and turn it around. Finally, it's just easier for them to sell brands off in batches. So actually, they've been selling large groups of brands that are 20 brands at a time to buyers who are looking to acquire distressed assets, which they can then I try to take forward and improve upon because hopefully we've watched the canary go down the coal mine and learned the lessons of how these guys got it so badly wrong. These guys, as we all know, were financial guys who raised a bunch of money to run e-commerce businesses. And the people who are now trying to rescue these brands are people who know how to run e-commerce businesses. So with any luck, some of these brands can indeed be rescued and that's hopefully what I'm going to do with mine. Speaker 1: So what's the plan going forward? So you've got, as we said, as of January, when did you secure and sign off the buyback? Speaker 2: Yes, the deal has been done. The brand itself, as of the time of recording this in early January 2025, It's no longer with the owner that I sold it to. We have it. We are now in the process of selling that brand into a new Phoenix company in the UK. When I say we, I mean we because this is not just me. There's a business partner involved here. He doesn't want to really be spoken about publicly, but actually the power of Twitter is what really enabled this deal to even happen because When I got in touch with the guys that I keep almost mentioning their name, and I can mention their name, if you just search my name and Beast Gear, you'll find these guys, right? They actually, for a period of time, they made me their poster boy. I drank the Kool-Aid. I spoke about what a great job they were doing, which is why it kind of hurt even more to watch the brand be kind of eroded away. I posted on Twitter and LinkedIn Almost kind of like shitposting, like baiting the owner saying, hey, sell me back my brand. And I got some bites. And I got a really interesting bite from a really interesting guy who is the founder of one of the OG aggregators from back sort of 2018-19 times. Only the difference between him and the others is he didn't mess it up. He knows what he's doing. And essentially, we struck upon a deal whereby he would buy back a group of brands And within that group of brands is my brand, Beast Gear. Speaker 1: So you didn't buy directly. You bought it through... Speaker 2: We bought it. We bought it. We bought it. We bought it. It's been bought directly from the owners. Speaker 1: Right. Speaker 2: My business partner leading that deal. And I am now 50-50 on my former brand. So full transparency, I don't own 100% of the brand anymore. However, what's going to be really exciting is we have plans to grow this thing into hopefully what I had imagined it would become before I actually made the decision to sell it. So for those who don't know what Beast Gear was or is, Beast Gear is a strength and conditioning brand. It does products for strength training, conditioning, CrossFit style stuff, and also just for generally going to the gym. And at one point, so late 2019 when I sold it, we were probably the biggest brand of that kind in the UK and Europe. We were doing about $6 million a year in revenue. So not the biggest brand in the world, but not bad for a guy on his laptop in his spare room. From Scotland. From Scotland, yeah. From sunny Aberdeen. And at that point, I was at a crossroads. I had a choice in my life. I could either continue growing this thing and turn it into – I had this vision for it to one day be the – a lot of people might be familiar with an American e-commerce brand called Onnit. They do the strength and conditioning equipment, they do the supplements, and they do the apparel. And I kind of thought about taking it in that direction. And then this offer to buy the business came, which was, frankly, life-changing. And especially when my wife was pregnant, we wanted to move house. It was just a good opportunity to sell. But now that we've got it back, we have this opportunity to do two things. One is to grow it into that on its style business, what I would have loved for it to become. The other is just to kind of put right the wrongs that I think have happened because now people ask me about that brand and I always say, well, if you look it up, it's embarrassing. It's cringeworthy. I have nothing to do with it, right? I kind of feel a bit ashamed about what there is out there. And so we want to turn it around. Speaker 1: Can I ask a question? Speaker 2: Yeah. Speaker 1: There's the founder love, the romance behind it. Speaker 2: Yeah, yeah. Speaker 1: It's the hero's journey, isn't it? Speaker 2: Yeah. Speaker 1: Get it back. Oh, yeah. Speaker 2: There's no denying it. Speaker 1: Yeah. Speaker 2: It's romantic. Speaker 1: Yeah. But have you also thought about outside of the romance and the practical element of it? And think about, here's the thing, right? And I'm not sure if people are fully aware of this, and I've seen it in the last decade over and over again. You can start a brand, be very successful with it, and then start a brand in a new category, do exactly everything right, same SOPs, you've got a flush of cash, and it sells miserably. And quite often that comes to two things, which is domain knowledge, And timing and the market of what's out there already. Now when you launched Beast Gear 2016 and you sold in 19. Yeah. So there was a period that is completely different to what it is today. Speaker 2: Yes. Speaker 1: Right. So you've got a lot of reviews. It's grandfathered in. You've got a lot of experience. You've been doing this 10 years and stuff. And different from others, you're going back in to do the same thing that you Basically, developed from the very beginning anyway, so you have the domain knowledge, right? Speaker 2: Yeah, that's true. Speaker 1: But with timing and the market and with brands launching later and the increase in sophistication, have you factored that in as a risk point as well? Speaker 2: Yeah, there's no doubt there are risks involved. This might not work. However, there's a lot of reasons that I'm very confident it will work. First is that in the time since I sold it to when I bought it, I still see competitor brands making the same mistakes. And a lot of that is simply they're just trying to sell stuff on the internet. They are not building what I would call a legit brand that really deeply understands its customer, develops quality products that solve those problems and builds a relationship with the customer and looks and feels and behaves like a real brand like their own favorite brands do. When we came along, when I came along and Beast Gear came along and we started to do all the things that the real brands do, which all of our competitors just kind of trying to flog stuff on Amazon were doing, we kind of set a trend for that in the UK. It wasn't long before we saw a whole bunch of copycat brands across the strength and conditioning space using logos that look like ours, fonts that look like ours, color schemes that look like ours. Speaker 1: There's two out there that are almost exactly, and they're not called Beast obviously, but almost with the word that they use, the white text, the black background, the image, nearly everything, they've literally copied you. Speaker 2: Yeah, but they can't copy soul and they can't copy the relationship with customers. So if you go to any old Beast Gear listing and go to the reviews and run a search for the word Ben, You'll find dozens upon dozens upon dozens of reviews from before I sold the brand mentioning me by name. Now, that wasn't because I was dealing with those customers myself. It's because I had a whole bunch of processes, a team. I was the face of the brand and we built a relationship with our audience. I don't anticipate it being that difficult to resurrect that. That's part one. Part two is because we're not When I got into this, I didn't even know that you could sell on Amazon. I started a strength and conditioning brand and in the course of doing so, found out that you could sell on Amazon. But we also sold on our own D2C website. We've got an email list of thousands of people. We, at one point, had a very engaged Instagram audience. If you're listening now, before we resurrect the Instagram, you can go and see that nothing's been done there for years. We have an audience there who I believe will be excited that we're back. And I believe that we have the capability to engage with a new breed, a new audience. And I'm really excited for the potential of the brand to do really well D2C and on other channels too. One of the things I think actually de-risks this acquisition is the fact that I know more now than I did then. I've learned a ton through the consulting that I do with the brands that I work with, through the consulting that I do with the brands that I sell through EcomProgress. I've seen under the hood of a ton of businesses and I've learned a lot more, not just about I had run an e-commerce business but about brand, branding, marketing outside of the Amazon world. And a lot of people I still think are still kind of trapped in what I call the Amazon goldfish bowl. And I'm incredibly confident that we have a brand and a brand identity that can connect with our audience and therefore sell to them outside of just Amazon. And not only that, I also think that one of the ways that this is not risky is that I kind of can't lose. If this doesn't go well in terms of the actual Beast Gear business, without getting into too much on the detail on the actual deal, there's not a lot of downside here. So if it doesn't go well, all I get is I learn more. This is another chance for me to learn. It's another chance for me to grow. And by extension, it's a chance for the community to grow because I'm going to document the entire turnaround on YouTube and possibly a podcast as well. To say, hey, here's what happens when you take a brand that's an absolute mess and try to turn it around, and I'm going to share that in radical detail. Speaker 1: Yeah. Ryan Daniel Moran did that, didn't he? He brought back his brand. And he made it a success. Speaker 2: Yeah, he is. He's doing it right now. He had a supplement brand called Sheer Strength and he talks about the turnaround of that. I don't think he's got a channel dedicated to it but he just shares stuff on his Instagram. And when he bought it back, it was basically doing nothing and I think he's got it back to sort of six figures now. And it's great to share that. Speaker 1: So what's the plan then? You said you know more about the market and stuff. What are we looking at in terms of execution? Speaker 2: Yeah, sure. I don't think we can talk about that without talking a little bit about giving people kind of a sense of where the brand is at. So when I sold it, it was doing about six million a year. Now it's doing about one million more or less. So, it is a shadow of its former self. When I saw that we were selling D2C on our own website in the UK, that's been shut down. We're going to resurrect that. We were selling on Amazon UK, Amazon across Europe, a little bit in Australia and the Middle East. Australia and the Middle East have been shut down and Europe has retracted a lot. The new owners tried to launch in the US and absolutely messed that up. So what we're going to do initially is kind of, I would kind of say that it's a little bit like a military retreat. We're going to come back to basics, get the UK sorted out and go from there. We're going to bring back our D2C website and resurrect our power line. We had a print-on-demand power line when I sold it. We're actually going to resurrect that, but it won't be print-on-demand. We will hold hard inventory for a whole variety of reasons, but mostly simply margins and quality. We're going to go from there. In terms of actual ops, day-to-day ops to begin with, they're going to be run by my business partner, Sean, who co-owns a brand and an agency with me. I will take the lead on the strategic advisory side. I know this industry very, very well. I'll still get my hands dirty sometimes. Apart from anything else, it's great fun. And depending on how well the turnaround goes, we'll see how we go. As we scale, we're going to have to make sure that we make the right hires at the right time to get this where it can be. I believe this could be an eight-figure branding. Speaker 1: You're going back in to Ben, the work time. Was it agriculture? What did you do before? Speaker 2: I was in the oil and gas industry, but I was like the token tree hugger who helped oil companies get greener. That was my job. Speaker 1: By day. Speaker 2: By day. Speaker 1: Beast Gear by night. Speaker 2: Beast Gear by night on lunch times and whenever my boss wasn't looking. Speaker 1: But the point is you built Beast Gear. There wasn't a big team behind you. Speaker 2: No, there wasn't. It was me and three VAs. Speaker 1: Yeah, exactly. It sounded like you're more playing a role as advisory or consulting than that Sean's going to run. My question is you're coming back in almost like a reverse startup mode because you're coming back from almost the beginning. Speaker 2: Yeah. Speaker 1: And you're building again. Are you going in to get your hands dirty or are you going in and advising and putting the team in place? Speaker 2: Look, there's no denying it's going to be a combo. I will get my hands dirty a bit. Speaker 1: I think you need to. Speaker 2: Yeah. A, I need to. Yeah. To help Andrew. Before you can You can't grow something, scale something, or in this case, even fix something. You have to understand what that something is. Speaker 1: And where it is. Speaker 2: And where it is and understand the present state of it. You can't just say, try to wave a magic wand and say to people, make it thus. No, you have to go and understand it before you can start to fix it. Speaker 1: Yeah, without a doubt. So, lofty goals. Hmm. You mentioned that you can take it to eight figures or you believe. Speaker 2: Yeah, we could. Speaker 1: Is that with or without entering the US and you're coughing about the cash flow? Speaker 2: Yeah. Yeah, fair point. So, you know, this touches upon a little bit on a huge regret that I have. I don't have a lot of regrets, but I do regret this. When I sold the business the first time around, we were not in the US. And I had made a decision to be first in Australia, be first in the Middle East, and to go into Europe. Those themselves were not bad decisions. But what was a bad decision was neglecting the US. And to this day, I honestly, I can't even pinpoint why, why I didn't do it. Because I jumped through a ton of hoops and bureaucracy to get into Europe. Why didn't I go to the US? Because I honestly think for maybe an extra 20% effort, the business could have been five times bigger without me really being a better entrepreneur. Speaker 1: It depends on the competition. Did you study the competition there? Speaker 2: Yeah. Speaker 1: Germany's quite... Speaker 2: We did well in Germany. Yes. At that time, I think, especially from a brand identity point of view, we were far better than the US. Speaker 1: But you didn't have the brand recognition. What you had in the UK and the US, did you? Speaker 2: Outside of Amazon, no. But at that time, pulling the reviews over, I really think it would have been really quite simple to get flying in the US. And then what we actually did eventually see was a bunch of copycats emerge in the US who had clearly been looking at what we'd been doing over in the UK. And then the new owners tried and failed to launch in the US. Partly because it was a bit too late and partly because they were just not competent. Speaker 1: Hmm. Speaker 2: I can't remember what your actual question was. Speaker 1: Well, going into the US, the point I was going to say is when we were looking after your PPC a few years back, you had a lot of branded terms. So that would help, obviously, in the UK and in Germany and other places because you have branded terms there. But you'd have zero in Germany. I'm not saying that's the be all and end all. What I'm saying is the brand awareness was there. Was in Europe, not in the US. So that's a new beast then because some others Yeah. Speaker 2: And those challenges are there, but I guess the way I view those challenges are those are just like the challenges of a startup, right? So we've got some advantages from our history, and there are some things where we don't have advantages, but we do have advantages on is experience. But even to this day, we have brand recognition. Yesterday, I had a call with one of my other hats on, a completely different thing to do with econ brokers. And at the end of the call, the guy says, Oh, just before you go, didn't you find Beast Gear? Speaker 1: Yeah. Speaker 2: I'm like, yeah. And he's like, I still use your boxing gloves. And it turns out this guy has like 800,000 followers on Instagram and now we're going to talk, right? Because he has a boxing channel on Instagram, which was not the purpose for the call. This was really quite boring stuff that we were talking about. So the brand recognition is there. I still get texts from people who see my products out in the wild in gyms. This is why I'm very bullish that we can turn it around. Speaker 1: And if I remember rightly, because obviously you have a boxing brand, but prior to that, didn't you have some UFC guys wearing it around in world championships? Speaker 2: Yeah, this is one of my favourite stories from the first time around. I woke up one morning to a Like a whole bunch of emails in my inbox saying, you know, did you see the fight? Did you see the fight? And it turned out, and people were sending me screen grabs of this, that Michael Venom Page, who is a UFC fighter, used my mouth guard in his fight. And better than that, right before the fight, he goes right up to the camera, opens his mouth and smiles, and it's Beast Gear across his teeth. I didn't pay him. I didn't know him. He wasn't my, like, affiliate. But him and his team chose my product because the way I was marketing the brand was not just like some crap on Amazon. We were a brand and we weren't selling in the U.S. and this was a U.S. fight. So they'd taken the gear all the way over from the U.S. Speaker 1: This is where U.S. recognition comes from, things like that. Speaker 2: Things like that, right. But that only happens, you create your own look. That only happens, and there are various other celebrities and athletes that have used my stuff before, that only happens when you put your brand in the position to get there by acting like a real brand in the first place, which is creating blogs, having a YouTube channel, interacting on Instagram, sponsoring a podcast, having your own podcast, email marketing, rather than just slapping a listing on Amazon and expecting to get sales. Speaker 1: Before we end up wrapping this up, what I want to do is I want to go through this whole process again because it'd be handy for people if they're looking to buy back a brand. Speaker 2: Yeah. Speaker 1: Obviously you did the baiting thing. Speaker 2: Yep. Speaker 1: On Twitter. I don't advise that to anyone but you obviously get away with it. Twitter's a fucking toxic place. I can't stand it. Speaker 2: It is pretty tough. Speaker 1: But let's go through if someone He's listening and considering to buy back their brand. What are the four or five key takeaways, the process to do it and is there any residual in the end for the buyback and are they going to end up earning, will they get an earn out on the buyback? Is there any percentage on future sales or any kind of stipulation? Speaker 2: It all depends on the deal. It also depends on the appetite. Speaker 1: No, your deal. Speaker 2: I can't really speak about our deal. Well, here's what I can tell you and how I would recommend people approach this. You want to mitigate your downside. At the end of the day, you're buying a damaged asset. The whole reason that your brand is potentially up for sale in the first place is because the new owner that you sold to hasn't done a good job with it and now it's damaged goods and you're buying damaged goods. So it's not like you're buying a cash flowing asset that's going to make you rich at the moment that you've got it. No, you're buying something that you're going to have to turn around. So you want to minimize your downside. So, you want to make sure that that deal is as little money, if perhaps nothing, up front. Inventory paid for on consignment, which means that you pay for it as you sell through it at cost, preferably even below cost to manufacture. The remainder is on some sort of an earn out based on how the business performs over the next two, possibly three years. So that's really, really important. Don't be tempted. I can't deny it. A huge part of this is emotional. It's ego. Like, I want to turn around this thing and make it great again. I don't like seeing it out there kind of not being very good. But you also have to be aware of that and not be blinded by that and then make really stupid, costly decisions based on that. Assume that it's all going to go wrong. So like then ask yourself, okay, whatever I've invested into this, am I comfortable with losing that? It's a bit like betting, you know, only bet where you can afford to lose. Speaker 1: Yep. Indeed. Any other things that help you out that not you regret doing but you would have done differently? So on this deal, which is not part of the deal, are there a couple of things you didn't put into place that sellers could? Just off the top of your head, is there anything there that you go, do you know what I should have negotiated for that or I should have included this? Speaker 2: Honestly, on these deals, the sellers, which in this case is whoever you previously sold to, let's just assume it's an e-commerce aggregator, they're in a very distressed position and what they're trying to achieve is offloading this asset as quickly as they can For the best deal that they can but they're not in a great negotiating position. Yeah But they also want to keep the deal very very simple. Yeah so Throwing in complex cities isn't really an option. It's really just about we're gonna pay you this much up front Inventory on consignment and here's the earner and that's really it right. Um, and Yeah. Speaker 1: Yeah, because there's going to be different types of deals. Yours, as I said, like there's three to four components there. The reason I also said it is because how does the deal work? Because some people might go, you know, you can, outside of your deal and where it's at, there will be others that are further down the chain or even further on their ass. You just want to get rid of it. And literally, you get it for nothing. Speaker 2: I mean, that's the thing. For example, you might just be able to buy the quote-unquote goodwill associated with the brand. And at that point, we're literally talking about basically the trademark. And you can get that for incredibly cheap. And I would encourage people to make the cheekiest, low-balliest offer you can stomach giving. And you'd be surprised what you can get back. Unknown Speaker: I'm not sure about Claude. Speaker 1: Well, on the other hand, you know, it was your baby position when they bought from you, they had the power. I can buy anyone, but I'm choosing you today. Do you want to do or not? Not exactly that, but they had the power of leverage and they would have exercised that. Now you're exercising yours. Speaker 2: Here's one power card that you can play, which is, hey, I built this brand to what it was when you first wanted to buy it. If you want any chance of getting anything out of this deal on the back end, you need the brand to be rescued. I'm the man to do that because I know how to do it because I built it in the first place. Speaker 1: Yeah. Speaker 2: So that's why you're better to sell it to me rather than someone else because I can turn it around and then you have at least a chance of getting something on an earner. Speaker 1: Yeah. Comes back to domain experience and knowledge. Speaker 2: Exactly. Yeah. Speaker 1: Cool. Any last thoughts? Speaker 2: Yeah. Yeah, totally. I'm documenting the whole thing in radical detail. I think that's kind of Ryan's done this a bit on his Instagram, which is great. I don't think anyone's going to have done it to this kind of level of detail or sort of dedication before. So if you head to brandrescuemission.com, you can chuck your email address in there and be alerted when we start. Speaker 1: Guys, thank you for joining us today. I hope you enjoyed the show. Of course, I'll be back here next week. But before we go, what's the best way that people can reach you? Speaker 2: Yeah, I'm all over social, Instagram, LinkedIn, Instagram. Email me, ben at benleonard.pro or go to brandrescuemission.com. Speaker 1: Excellent. Ben, thank you for joining us today. Guys, I'll see you back here next week. Take care of yourself and your family. Much love and I'll see you then.