Executive Summary

This ecommerce brand is a young, SEO-driven direct-to-consumer BJJ apparel brand with promising organic traction and clear growth levers. However, material financial data inconsistencies (profit margin discrepancies and order/customer mismatch) must be resolved before advancing to acquisition discussions.

Business Overview

The Shopify-based eCommerce brand specializes in Brazilian Jiu-Jitsu apparel, including Gis, rash guards, shorts, and accessories. The brand positions itself as design-forward and competition-ready, with SEO as its primary growth channel and a modest but active social presence.

Business Highlights (claimed in listing):

• Profitable with high margins.

• SEO strength: thousands of ranking keywords and backlinks.

• Hybrid fulfillment (dropshipping + self-fulfillment).

• Owner workload ≈ 20–25 hrs/week.

Key Strengths

• SEO & Content Marketing: Active blog with product/intent-based keyword targeting, creating organic traffic opportunities.

• Product Range: ≈72 SKUs across Gi, No-Gi, and kids’ categories, providing strong cross-sell potential.

• Community Validation: On-site customer reviews and active Instagram/Facebook accounts support niche credibility.

• Operationally Lean: Seller claims low refund rates, high fulfillment rates, and moderate owner time commitment.

Financial Performance

Reported Monthly P&L (Sep 2024 – Aug 2025):

Derived Metrics:

• Average Monthly Revenue: $26,305

• Average Monthly Profit: $5,591

• Profit Margin: ~21.3%

• AOV (based on 2,327 orders): ~$136

• Orders/Customer Ratio: 0.73 (impossible) → reporting error.

Discrepancy: Flippa’s public summary shows ~$290K revenue & $116K net profit (~40% margin), which conflicts with the monthly ledger (~21% margin).

Website & Operations

Strengths:

• Clean Shopify layout, high-quality visuals, conversion-friendly design.

• SEO-driven content & recent blog activity.

• Positive review presence.

• Hybrid fulfillment with high reported fulfillment rates (98.2%).

Risks/Unknowns:

• True website conversion rate & traffic not disclosed.

• Site performance (speed, Core Web Vitals) unverified.

• SKU complexity (multiple sizes/variants) increases returns risk.

Marketing Analysis

Organic (Strength):

• Strong SEO footprint is the main acquisition engine.

Paid (Opportunity):

• Paid channels (FB/IG/Google Ads) appear underutilized. This is a major growth lever.

Community & Influencer Potential:

• BJJ niche is community-driven; gym/academy partnerships and athlete influencers are natural low-CAC growth channels.

Customer & Data Assets

• Email list ≈ 2.8–3K subscribers (quality & engagement unknown).

• On-site reviews show positive sentiment.

• LTV and repeat purchase data unavailable due to customer/order mismatch.

• Requires verification via raw Shopify order/customer export.

Legal & Compliance

Concerns:

• Product titles reference third-party brand names (“Shoyoroll cut”) → potential trademark/IP risk.

Required Verifications:

• Supplier invoices & contracts.

• Proof of licensing or authorization for branded SKUs.

• Trademark/IP ownership.

• Tax filings & business registration documents.

• Any history of disputes or litigation.

Challenges Identified

1. Financial Discrepancies: Conflicting profit margins & impossible customer/order ratio.

2. Young Brand (≈1 year): Limited operating history.

3. Operational Complexity: Large SKU matrix → sizing/returns risk.

4. IP Risks: Use of third-party brand names in product titles.

5. Unproven Paid Channels: CAC/ROAS unknown.

Recommendations

Pre-Offer (must-do):

• Request and reconcile Shopify exports, bank/processor statements, and supplier invoices.

• Verify licensing & trademarks.

• Conduct website performance audit.

First 3 Months Post-Acquisition:

• Launch small-scale paid acquisition tests ($1–2K budget).

• Optimize email flows (welcome, cart recovery, post-purchase).

• Explore fulfillment simplification via 3PL.

Scaling (3–12 Months):

• Partner with gyms/instructors for bulk sales.

• Expand product lines (accessories, kids, training gear).

• Invest in influencer-driven growth campaigns.

Valuation Context

• Typical eCommerce multiples: 2.5×–4× SDE.

• Reported profit multiple of 0.3× (on Flippa) is abnormally low → suggests inaccurate reporting or distressed positioning.

• Valuation should not proceed until profit figures are reconciled with third-party docs.

Conclusion

Novakik BJJ has strong fundamentals (SEO traction, niche positioning, product depth), but unresolved financial inconsistencies and potential IP concerns make it too risky for immediate commitment.

Recommendation:
Do not proceed with an offer until discrepancies are clarified with verified Shopify exports, processor statements, and supplier agreements. If verified at a 21% margin, the business offers a solid growth platform. If the higher 40% margin is correct, it is significantly more attractive — but proof is essential.

Seller Document Request Checklist:

Send this to the seller before any LOI or valuation:

1. Shopify orders export (CSV, last 18 months).

2. Stripe/PayPal/merchant statements (last 12 months).

3. Supplier invoices for representative SKUs.

4. Proof of licensing/authorization for branded products.

5. Google Analytics & Search Console reports.

6. Email list engagement report (open/click/revenue).

7. Any trademarks/IP documents.

8. Explanation for profit margin discrepancy (Flippa vs P&L).