As soon as Neil Jervis launched Puzzle Ready in 2018, jigsaw puzzle boards began flying off Amazon’s shelves.

“The demand was already there,” Jervis explained.

But this wasn’t just a lucky coincidence.

Jervis, who started selling products on Amazon in 2015, had researched hundreds of thousands of products.

Puzzle boards — a surface that made it easy to assemble, store and transport puzzles — had been on his list for years. There was only one other seller on Amazon, and demand for the product seemed steady.

Based in Australia, Jervis hit it big in the jigsaw world, especially when the pastime boomed during COVID. But around three years after launch, in 2021, he started to feel like the risk outweighed the reward — and he began looking for an exit.

How one product — a puzzle board — resulted in $3M revenue

Jervis worked with two team members — one in the Philippines and one in China — to run Puzzle Ready.

To grow, he focused on designing a high-quality board for 1,000-piece and 1,500-piece puzzles. Prices fluctuated depending on the time of year, inventory and promotions. The smaller board typically sold for $70 to $100, and the larger board went for $100 to $140. The wooden board had a non-slip surface and color-coded storage drawers.

“It had a higher price point than competitors, but our demographic was willing to pay more for the best,” Jervis said.

Not only did he keep the target puzzle-board buyer in mind, but Jervis also kept his target business buyer in mind, building the business in a way that would be attractive to them.

Puzzle Ready made 99% of sales through Fulfillment by Amazon (FBA). The boards were manufactured at a factory in China, which Jervis found through a sourcing agent, then they went straight to Amazon, where they were stored, packed and shipped, so he never needed a warehouse.

This kept operations lean — a strategic move since Jervis anticipated the most likely buyer of the business would be an Amazon aggregator, a company that buys successful FBA businesses to add to a larger product portfolio. Aggregators often want to keep operations simple and their teams lean. So, he did the same.

“A lot of Amazon sellers are trying to diversify off Amazon and get their own e-commerce sites set up on Shopify, work on brand presence, work on off-Amazon advertising,” he explained. “But I knew that the aggregators were my target buyer, and they didn’t really care about that. They didn’t have the skills or team or desire to manage Shopify sites.”

Jervis also stuck to Amazon when it came to advertising. The only money he spent to market his product was through Amazon’s Pay-Per-Click (PPC) system, which runs ads on Amazon.

Three years after launch in December 2021, Puzzle Ready had sold 31,000 units in the previous 12 months, bringing in $3 million in revenue.

COVID and holiday booms spark second thoughts

When the pandemic struck, puzzling surged. As early as April 2020, one gamemaker reported sales jumped 370% year over year. Puzzle Ready felt the impact, too.

“COVID was definitely a huge boom,” Jervis said.

But the trend also added pressure. “I was worried, then, that after COVID, there’d be a drop-off in demand,” he said. He noted this never really happened — but the thought pushed him to consider selling.

Cash flow was another challenge. The holidays were Puzzle Ready’s busiest season, and Jervis had to place large inventory orders months in advance. Plus, the cost of shipping kept increasing.

“The projections were scary,” he said. “I was projecting I would sell $1 million worth [of boards] in December alone. … So it was all that money going out with the hope that the projections were right, and there’d be no issues, and everything would get to Amazon on time, and the sales would come in.”

Compounding the stress, Puzzle Ready only sold one product, which at times felt risky.

“It felt very fragile, and the risk started to outweigh the reward,” Jervis said.

How the stalking horse became Puzzle Ready’s buyer

So when Jervis began considering selling Puzzle Ready, his goal wasn’t necessarily to maximize the upside — he wanted to minimize the downside. With the stress of Q4 looming, he began working with a business broker to find a buyer.

“The broker was a guy who capitalized on the craziness of the aggregators,” he said, referencing the boom of FBA aggregators during the pandemic’s e-commerce boom. “The buyer paid the commission — not the seller.” As far as Jervis knows, that broker has since stopped operating on this model, which makes sense as several major aggregators shuttered post-pandemic.

Jervis spoke with four or five potential buyers, all Amazon aggregators. Two emerged as serious contenders, including eBrands.

Initially, Jervis was more interested in selling to the other company and used eBrands as “a stalking horse to get the price up,” he explained. “But the last offer they made was really good, to the point where I had to take it.”

He continued: “Having two interested buyers got me a lot more than if I had just talked to one. It made a huge difference.”

The acquisition closed in December 2021, when Puzzle Ready sold for a 7-figure sum. The sale multiple 6x profit — with 3.5x profit paid upfront and 2.5x to be paid after one year based on performance.

It’s worth noting 2021 was a big time for selling FBA businesses, with founders fetching above-average sales multiples. Multiples have since decreased.

Overall, Jervis described the acquisition process as more “casual” than he expected. He was initially intimidated by speaking with potential buyers, but quickly realized “they were winging it as well,” he said.

His biggest challenge was staying focused on running Puzzle Ready while working on the sale.

After the deal closed, Jervis shifted his focus to a side project he’d already been building: Datarova. The SaaS platform provides Amazon sellers with data-driven insights to optimize success, including keyword research, competitor tracking and sales trend analysis.

These types of insights are what helped Jervis launch and grow Puzzle Ready.

As for advice for founders, Jervis offered: “It’s important that anybody considering selling their business doesn’t think they have to have their sh*t together!”