Look, I’m going to be straight with you right out the gate.
If you’re one of those people still clinging to the traditional 60/40 portfolio like it’s some kind of investing scripture, you need to wake up. Bonds returned a measly 1.25% in 2024. Let me repeat that, 1.25%. Meanwhile, inflation’s been sitting around 2.7-3.0%. So basically, if you had your money parked in bonds last year, you barely broke even after inflation ate into your returns.
And the S&P had a solid run in 2024, but let’s be real, how comfortable are you riding that rollercoaster when the Magnificent 7 can drop 8% in a week and drag your whole portfolio down with it?
Nobody wants to admit the traditional playbook is broken. The rules that worked for your parents’ generation don’t work anymore. Interest rates are all over the place, inflation isn’t going anywhere quietly, and everyone’s fighting over the same tired investments.
Meanwhile, there’s this whole universe of alternative investments that most people ignore because they either don’t understand them or they’re too scared to learn. Specifically, I’m talking about digital asset classes. And within that space, e-commerce businesses are absolutely crushing it in ways that should make every real estate investor and stock market junkie seriously reconsider where they’re parking their money.
So let me break down what alternative investments actually are, why digital businesses deserve way more attention than they’re getting, and most importantly what kind of returns you can realistically expect when you know what you’re doing.
Alternative Investments
“Alternative investments” is one of those Wall Street terms that sounds fancy but usually just confuses people. So let me simplify it.
You’ve got your standard stuff: stocks, bonds, cash, maybe some real estate. Alternative investments are basically everything else. Private equity, hedge funds, commodities, collectibles, and increasingly digital assets like e-commerce businesses, SaaS companies, content sites, and mobile apps.
The whole point of alternatives is that they don’t move in lockstep with traditional markets. When the stock market tanks, your alternative investments might hold steady or even thrive. That’s real diversification, not just owning 30 different tech stocks and pretending you’re diversified.
Here’s the thing that should grab your attention, alternative investments now represent over $13 trillion in assets under management globally according to Preqin’s 2024 report. Family offices and high-net-worth individuals are putting 20-30% of their portfolios into alternatives now, up from just 5-10% a decade ago.
Because the smart investors figured out that traditional markets can’t deliver the returns they need anymore. They’re not chasing alternatives for fun, they’re chasing returns that actually move the needle.
Why E-commerce Businesses Are Different
Here’s what makes e-commerce businesses such a weird and wonderful investment: they combine the best parts of real estate and tech startups without the worst parts of either.
Think about it. With real estate, you get predictable cash flow, but you’re stuck dealing with tenants, maintenance, and it takes forever to sell if you need liquidity. With tech startups, you get growth potential, but you’re gambling on someone’s idea and you might wait years before seeing a dime.
In E-commerce businesses you’re buying something that’s already making money from day one. There are already customers buying products. There are already suppliers delivering inventory. The marketing channels are already working. You’re not investing in someone’s dream you’re buying a machine that’s already printing cash.
And the beautiful part is e-commerce scales in ways that physical businesses just can’t. You don’t need to build another warehouse to grow 30%. You don’t need to hire 50 new people to enter a new market. The cost of scaling a digital business is dramatically lower than traditional businesses, which means more of that growth goes straight to your pocket.
Empire Flippers reported that the average e-commerce business sold on their platform in 2024 had profit margins between 15-25%. Go find me a brick-and-mortar retail store that’s running 15% margins. I’ll wait. Most physical retailers are thrilled if they hit 5%.
How We Actually Figure Out What’s Worth Buying
At TrendHijacking, we’ve looked at hundreds of e-commerce businesses for sale. We’ve bought some, passed on most, and learned expensive lessons on the ones we got wrong. So let me walk you through exactly how we evaluate these investments, because this is where most people either make a fortune or lose their shirt.
Revenue Quality Matters More Than Revenue Size
I can’t tell you how many times I’ve seen investors get excited about a business doing $500,000 a year in revenue without asking the most important question: where is that revenue coming from?
A business doing $500,000 from repeat customers with 70% gross margins is worth 3-4x more than one doing $500,000 from one-time buyers with 30% margins. It’s not even close.
We dig deep into customer acquisition costs, lifetime value, repeat purchase rates, and revenue concentration. If 40% of revenue comes from one product or one traffic source, alarm bells go off. We want diversified revenue streams that can weather platform changes, algorithm updates, or supplier drama.
The absolute gold standard is subscription revenue or consumable products. A coffee subscription business or a supplement brand where customers reorder monthly is inherently more stable than a furniture store where people buy once every five years. One is predictable cash flow. The other is constantly hunting for new customers.
Traffic Sources Can Make or Break You
New investors get wrecked because they see a business pulling in $50,000 a month and assume it’s a money printer. But then you dig into how that revenue is being generated and you realize the whole thing runs on paid Facebook ads and the cost per acquisition has been climbing for six months straight.
You didn’t buy an investment. You bought a problem.
On the flip side, if a business has strong organic search traffic, a loyal email list of 50,000+ subscribers, and customers coming from five different channels, now we’re talking about something stable and scalable.
We look at traffic trends over 12-24 months minimum. Is it growing, flat, or declining? What’s the mix between paid and organic? How much does it cost to acquire a customer, and how long until that customer becomes profitable?
Shopify’s 2024 commerce report showed that businesses with diversified traffic sources have 3x higher survival rates than those dependent on a single channel. That’s not theory that’s cold, hard data telling you where to put your money.
Operations Can’t Be a Nightmare
One of the dumbest mistakes investors make is buying a business that looks incredible on paper but requires 60 hours a week to actually run. Congratulations, you didn’t buy an investment, you bought yourself a full-time job.
We evaluate operational complexity like it’s the most important thing in the world, because It is. Can virtual assistants handle customer service? Can the marketing be automated or handed to an agency? Is the supply chain stable or are you constantly putting out fires?
The best e-commerce businesses run on systems and processes. Order fulfillment, customer onboarding, monthly reporting all of it should be documented and repeatable. If the current owner is the only person who can run the business, that’s a massive red flag.
We’ve passed on businesses with incredible financials simply because the operational burden wasn’t worth it. Your time is the one asset you can’t scale, so we only buy businesses that respect that reality.
Growth Potential Is Where The Real Money Lives
This is where things get fun. We’re not just looking at what a business is doing now, we’re evaluating what it could be doing with the right strategy.
Is the business only selling on its own website when it could easily expand to Amazon or Walmart Marketplace? Is it ignoring international markets? Has it never built proper email sequences or run retargeting campaigns? Is the pricing leaving money on the table?
The absolute best acquisitions are businesses that are already doing well but have obvious growth opportunities the current owner hasn’t tapped. Maybe they don’t have the bandwidth. Maybe they don’t have the expertise. Either way, that gap between current performance and realistic potential is where fortunes are made.
McKinsey found that e-commerce businesses that optimize for customer retention, expand product lines, and diversify traffic sources typically see 25-40% revenue growth within 18 months. That’s not aggressive moon-shot growth that’s just competent execution.
The Numbers Have to Actually Check Out
Look, sellers lie. Not all of them, but enough that you need to verify everything like your money depends on it because it does.
We want to see actual platform dashboards. Shopify sales reports, Amazon Seller Central data, payment processor statements. We cross-reference everything. We check refund rates, chargeback rates, inventory turnover, supplier payment terms.
We also pay close attention to why the owner is selling. Burned out and ready to move on? Perfect. Selling because they got banned from a platform or their main supplier dropped them? Yeah, we’re out.
The best deals come from motivated sellers with legitimate reasons for exiting. They’re retiring, pivoting to a new business, life circumstances changed, or they’ve simply hit the ceiling of what they can do and want to cash out while the business is strong.
The Part Everyone Actually Cares About: Returns
Alright, enough theory. Let’s talk about real numbers. What do these investments actually return?
The answer depends on whether you’re going for passive cash flow, active growth, or a strategic exit. All three work, you just need to pick the path that fits your goals and lifestyle.
The Passive Cash Flow Path
You buy a stable, established business with solid systems and hand it to a management team. You want steady cash flow with minimal involvement, think rental property but without the 2 AM phone calls about broken water heaters.
In this scenario, you’re typically looking at 20-30% annual cash-on-cash returns after management fees and operating costs.
Let’s say you buy a business for $300,000 that generates $100,000 in annual profit. After paying 15-20% for professional management, you’re clearing $80,000-$85,000 per year. That’s a 26-28% return.
Compare that to rental properties averaging 5-7% cash-on-cash returns and tell me which one makes more sense. Same investment amount, triple the return, and nobody’s calling you about a leaky roof.
The Active Growth Path
You buy a business with clear growth potential and roll up your sleeves. You’re optimizing marketing, expanding products, entering new markets, improving conversion rates. You’re treating this like an operating business, not just a passive investment.
In this model, returns can hit 40-100%+ annually depending on how well you execute. We’ve seen businesses grow from $200,000 to $400,000 in annual profit within 18-24 months through smart operational improvements. That’s doubling your investment before you even think about selling.
The trade-off is time and expertise. You need to know what you’re doing, or you need to learn fast. But for entrepreneurs who want to actively build wealth, this model can create serious money in 3-5 years.
The Strategic Exit Path
This is the private equity playbook adapted for digital assets. You buy a business, hold it for 2-3 years while improving operations, then sell at a premium multiple.
Here’s where the math gets exciting. Say you buy a business doing $150,000 in annual profit for $450,000 (3x multiple). You grow it to $225,000 in profit over two years through operational improvements. You sell at a 3.5x multiple for $787,500.
Your total gain: $337,500 on a $450,000 investment over two years. That’s a 75% total return, or roughly 37.5% annualized. And you were collecting cash flow the entire time.
Go try to flip real estate for those kinds of returns without getting lucky on a hot market. It doesn’t happen.
The Reality Check Nobody Wants to Hear
Look, I’d be lying if I told you these returns are automatic. You can absolutely lose money in e-commerce if you buy the wrong business, overpay, screw up operations, or fail to adapt.
The businesses that fail usually share common red flags. Over-reliance on single traffic sources, terrible unit economics, declining traffic, operational complexity beyond the owner’s capability, or buying at inflated multiples during a market peak.
But when you buy right, operate competently, and exit strategically, the returns in e-commerce are among the most compelling in the entire alternative investment space.
How E-commerce Businesses Are Actually Sold
This is something most people never think about until they’re ready to exit, and that’s a huge mistake. You should know your exit strategy before you even buy the business.
The good news is Selling an e-commerce business is dramatically easier and faster than selling traditional assets.
Most established e-commerce businesses sell through one of several channels. You’ve got major marketplaces like Empire Flippers, Flippa, and FE International that specialize in digital business sales. These platforms handle everything from initial listing to buyer vetting to escrow services.
The typical sales process looks like this: you list the business with verified financials, interested buyers get access to detailed prospectus documents, serious buyers go through due diligence (usually 2-4 weeks), and if everything checks out, you close through escrow. Total timeline? Usually 60-90 days from listing to cash in your account.
Compare that to selling real estate where you’re looking at 3-6 months on average, assuming the market cooperates and the buyer’s financing doesn’t fall through.
There’s also the private sale route where you find buyers directly through brokers, industry networks, or even competitors who want to acquire your business. These deals can move even faster if both parties are motivated.
Here’s what makes e-commerce exits particularly attractive: the market is liquid and growing. There’s constant demand from individual investors, private equity groups, aggregators, and strategic buyers. You’re not hoping someone wants to buy your specific business you’re choosing from multiple interested buyers.
Valuation multiples at exit typically range from 2.5x to 4.5x annual profit depending on the business quality, growth trends, and market conditions. If you bought at a 3x multiple and improved the business fundamentals, you might sell at a 3.5-4x multiple, making money on both the profit growth and the multiple expansion.
And here’s something most people don’t realize: you can structure the sale to minimize tax impact. Asset sales, earnouts, seller financing. There are multiple ways to optimize your exit depending on your situation.
The point is, when you’re ready to exit, you have options. Real, legitimate options that don’t require hoping for a hot market or finding that one perfect buyer. The liquidity in digital business sales is one of the most underrated advantages of this entire asset class.
Why Digital Assets Are Actually Different
Most alternative investments have some annoying catch that makes them impractical for regular high-net-worth individuals.
Private equity funds want $500,000+ minimums and lock up your capital for 7-10 years. Hedge funds charge 2% management fees plus 20% of profits and you’re trusting someone else completely. Collectibles and art require specialized knowledge and generate zero cash flow.
Digital asset classes like e-commerce are different. The barriers to entry are lower—you can start with $100,000-$200,000 in many cases. The liquidity is better—you can exit within 60-90 days if needed. The returns are competitive with or better than traditional alternatives. And you have operational control if you want it.
Plus, the market is still relatively inefficient. In real estate, every property gets analyzed to death and margins are razor-thin. In e-commerce, there are still deals where sellers underprice their businesses or where simple improvements can double the value.
That inefficiency creates opportunity. Opportunity creates returns.
The Diversification Angle Everyone Overlooks
Here’s something that doesn’t get talked about enough: e-commerce businesses have low correlation to traditional markets.
When the stock market was struggling in 2024 and bonds barely delivered positive returns, established e-commerce businesses in essential product categories kept generating steady cash flow. When interest rates spiked and real estate transactions froze, digital businesses kept selling at healthy multiples.
The Alternative Investment Management Association found that digital business investments showed a correlation coefficient of just 0.3 with the S&P 500. That means they move independently of the broader market, which is exactly what you want in a true alternative investment.
In a real portfolio, adding 15-25% exposure to digital asset classes can significantly reduce overall volatility while potentially increasing total returns. Better returns with less risk through proper diversification that’s the holy grail of investing.
Where Most Investors Screw This Up
I’ve watched smart, successful people make dumb mistakes when they first dive into e-commerce investing. Here are the most common ones:
Buying based on revenue instead of profit. A business doing $2 million in revenue with $100,000 in profit is worth less than one doing $500,000 in revenue with $150,000 in profit. Profit is what matters. Revenue is vanity, profit is sanity.
Ignoring traffic trends. If traffic has been declining for six months, you’re not getting a deal you’re catching a falling knife. Traffic trends predict the future.
Underestimating operational complexity. Just because the seller claims it only takes 10 hours a week doesn’t mean that’s true. Always overestimate the time commitment.
Overpaying because of FOMO. In hot markets, businesses get bid up to stupid multiples. Patience and discipline beat excitement every single time.
Not planning the exit. If you don’t know how you’re getting your money back out, don’t put your money in. Always invest with the exit in mind.
How TrendHijacking Fits Into This
At Trend Hijacking, we’ve spent years building expertise in evaluating, acquiring, operating, and exiting e-commerce businesses. This isn’t a side hustle for us, it’s what we do all day, every day.
Our approach is built on a few core principles. We only invest in businesses we’d be comfortable operating ourselves. Strong fundamentals, manageable complexity, clear growth potential. We focus on diversification across product categories, traffic sources, and business models. And we operate with institutional discipline even though we’re investing in small to mid-sized businesses.
Whether we’re deploying our own capital or partnering with investors, the evaluation framework is identical. We’re looking for businesses that generate consistent returns, scale efficiently, and exit at premium multiples when the time is right.
The investors we work with range from busy executives who want completely passive exposure to this asset class, to entrepreneurs who want to collaborate on growth strategies. We’ve built programs that accommodate different capital levels, involvement preferences, and return objectives.
Some partners are treating e-commerce as a pure alternative asset allocation—they want 20-30% cash-on-cash returns with minimal involvement. Others are actively involved in growth decisions and targeting 50%+ annual returns through operational improvements.
Both approaches work. It just depends on your goals, timeline, and how hands-on you want to be.
Is This Right for You?
Here’s how to think about whether alternative investments in digital asset classes make sense:
If you’re 100% in stocks and bonds wondering why your portfolio feels stuck, adding high-cash-flow digital businesses could be exactly what you need. The diversification benefits alone are worth considering, and the return potential blows traditional fixed-income out of the water.
If you’re a real estate investor tired of tenants, maintenance, and illiquidity, e-commerce offers similar cash flow dynamics with better returns, faster exits, and zero property management drama.
If you’re an entrepreneur or executive who understands business operations and wants to build wealth through ownership rather than hoping stocks go up, this is one of the most capital-efficient paths available.
The key is starting with proper due diligence, realistic expectations, and a clear understanding of what you’re getting into. This isn’t passive index investing—it’s active alternative investing in real businesses.
Taking the Next Step
Look, I’ve given you the framework for understanding alternative investments in digital asset classes. The returns are real, the opportunity is real, and the diversification benefits are real.
But knowing about an opportunity and capitalizing on it are completely different things.
The investors who succeed in this space take the time to understand their own goals, capital capacity, and involvement level before diving in. They partner with experienced operators who’ve already made the mistakes and learned the lessons.
If what you’ve read today aligns with where you want to take your portfolio, the first step is figuring out which path makes sense for your situation. Passive cash flow, Active growth or Strategic exits? The answer changes everything.
We’ve built a quick assessment that helps identify whether a passive portfolio approach or a more active growth partnership aligns with your capital, timeline, and lifestyle. Takes about three minutes and gives you clarity on how alternative investments in e-commerce could fit into your wealth-building strategy.
Because the best alternative investment strategy is the one you actually execute. And if you’re going to do this, you might as well do it right.
