How to Make an Offer on an Online Business
Once your early checks on a listing hold up, the next step is putting a number in writing. A first offer isn't a letter of intent (LOI) and it isn't binding, but a vague or unsupported one gets ignored just as fast as a vague inquiry does.
What a first offer actually is
A first offer, sometimes called an indication of interest, is a short, informal statement of what you'd pay and on what basic terms, sent before either side commits to the time and cost of a formal LOI. It signals that you're ready to move from browsing to negotiating, but it doesn't lock you into anything. Either side can walk away from it without consequence.
Think of it as the document that tells the seller whether a real negotiation is worth having, not the negotiation itself.
What to include in your offer
- A specific price, with your reasoning. State the number as a multiple of SDE, and say which SDE figure you're using (trailing 12 months, most recent full year, whatever the listing itself leads with). A number with no reasoning behind it reads as a guess.
- The basic deal structure. Roughly how much would be cash at close versus a seller note or other deferred payment, even before the exact terms are worked out.
- Your key contingencies. What still needs to check out before you'd move forward, like verifying the numbers or confirming a platform account transfers cleanly. Naming these upfront is more credible than staying silent and raising them later.
- Your financing status. Whether you're prepared to close in cash, are pre-qualified for an SBA 7(a) loan, or are still lining up financing. This should already be consistent with what you said when you first reached out.
- A proposed timeline. How quickly you could move to a signed LOI and into diligence if the seller accepts the broad terms.
Keep it to a page or less. The goal is a number the seller can actually evaluate, not a full contract.
How sellers and brokers evaluate your offer
A seller or broker is reading your offer for the same signal they were looking for when you first reached out: can this buyer actually close. A few things specifically move that judgment:
- Whether the price is backed by a specific SDE figure and multiple, rather than a round number that doesn't map to anything in the listing.
- How many contingencies you're attaching, and how open-ended they are. A handful of specific, named contingencies reads very differently from a vague "subject to my satisfaction with everything."
- How quickly it arrived after you had the information you needed. A fast offer that reflects real homework on the listing outperforms both a rushed lowball and a slow, overly cautious one.
From offer to letter of intent
Once a seller accepts your offer's broad terms, or comes back with a counter you can live with, that agreement gets formalized into a signed letter of intent. That's the point where exclusivity kicks in, deeper diligence starts, and the terms you sketched out in your offer get written down in enough detail to actually guide the rest of the deal.
Next: once your offer is accepted, what goes into the letter of intent, and what changes before closing is what to expect from that next document.