Tag Archive | "buy websites"

Doing Due Diligence Before Buying a Site

magnifyingglass
This is a guest post that I did for Flippa. There are plenty of bargains on Flippa, but when you are considering buying a site (from anywhere), you must be careful that you perform due diligence and research and verify everything that is being claimed in the listing.  It goes further than just verifying all the claims in the listing. You have delve even further if you want to avoid some unpleasant surprises after you purchase the site.

If there is a large amount of money involved, you may want to hire a business broker to handle the due diligence for you.  A business broker could be expected to look into the business in detail, checking all of the company records including financial statements, budgets, contracts with staff and suppliers and customers if applicable, insurance policies, etc.

If the site being sold is less complex, it is not uncommon for the buyer to perform due diligence themselves. You’re going to have to play detective a bit and there are some useful tools to help you do this. Here are some questions to consider when thinking about buying a site:

  • Does the listing have a detailed, clear description of the site and it’s assets, traffic and revenue?
  • What stage in the Life Cycle of a site is this site in? Is traffic and revenue rising or declining and is there room for expansion?
  • How much competition is there and how do they compare in regards to position in the serps, price, product quality, etc.
  • Are there any obvious violations of FTC regulations, trademark or copyright violations, etc. You can do a trademark search online at TESS (for US trademarks) and use Copyscape to check the uniqueness of the content.
  • Check the site’s reputation in places like Rip Off Report and Better Business Bureau.
  • If products or services sold on the site are outsourced, will you continue to have access to those vendors or suppliers?

1. Checking Out The Domain

Domain Tools is a great tool to help you find information about the domain, how long the domain has been registered, who the domain is registered to (if whois information is not protected), Whois history, Reverse Whois, and has DNS & IP Tools.

You also need to look into whether the domain has suffered from reputation problems. You’ll want to know if the domain has been blacklisted by anti-SPAM or anti-virus sites or if the domain has been banned in Google. A simple search in Google using the operative site:domainname.com, replacing domainname with the site’s domain can tell you whether or not the site is listed in Google and how many pages are indexed. You can enter the IP of the site here to check to see if the domain is currently listed in the live Spamhaus IP blocklists.

The Wayback Archive is a pretty useful tool for checking out the history of a site. It has snapshots of the site, often going back years. Flippa also has Due Diligence information on the listings, giving you a detailed snapshot of many important website stats. To access that information, under the bar with the stats for Domain Visibility, Domain and SEMRush Stats, is a link that says, “View extended due diligence data for this listing.” Click on that to get detailed stats on the site that is listed.

2. Checking Out the Owner

Flippa and webmaster forums will give you some information about the seller, but it is usually only what they want you to know and very limited information. However, both Flippa and webmaster forums will normally give you a link to the feedback that a seller has received from previous transactions. This is very important information and you must take the time to check out their feedback. While it is not a guarantee that the seller is honest, it’s a good source of information on how the seller conducts business and if his customers are happy.

If the seller is new, you won’t have customer feedback to rely on. You will need to do some research yourself and Google can help you do that. Get the seller’s real name and type that in Google to see what kind of information you can dig up. You may find he/she has profiles in forums or social networks, such as LinkedIn, Twitter, Google Plus or Facebook.  You can often find some very revealing information on these sites about the seller’s character and reputation.

In addition to how happy their previous customers are, you can tell a lot about a seller by checking out their other listings, including the ones that have already sold.  You may be surprised to find that the seller sells this identical type of site many times over, and that would be something that you would probably want to avoid buying.

3. Confirming Traffic and Revenue Stats

From the Flippa listing, you have access to the stats for hits, page views, and unique visitors, but those stats don’t tell the whole story.  You need to verify where that traffic is coming from (referring urls) and whether or not the seller has purchased cheap, untargeted traffic to inflate the traffic stats. Insist on either Google Analytics or access to Statcounter or AW Stats to confirm where the traffic is coming from.  If some of the referring urls are unfamiliar to you, check them out to see where that traffic is coming from. Be aware that a portion of those hits can be from the seller himself or from the search engine bots crawling the site.

If the seller provides traffic stats from one or more sources, cross-check the numbers with other sources, such as Compete, Alexa or Quantcast. The numbers will never be exactly the same, but if there’s a huge discrepancy, it’s worth investigating.

4. Due Diligence on Site Revenue

One of the most unreliable pieces of information about a site is often the sites’ revenue. It is very easy to fake screenshots of revenue, so you cannot rely on them to verify how much money a site is making. If revenue is a selling point of the site, it is very important to be able to verify the accuracy of the information given in the listing without relying on screenshots.

One way to verify the revenue of a site that is more reliable than a screenshot is by using screen sharing software.  This is very helpful to get a more accurate picture of the revenue without the seller having to give you login details to his accounts.

Learn to distinguish between actual, verifiable facts about a site and just unsubstantiated claims, such as “potential $15,000 month income,” or “the main keyword has 50 million searches per month,” etc. Statements that are not verifiable are not relevant and are only a distraction.

A site’s revenue should be based on a solid earning history. If the site was established two months ago and is claiming revenue of $1,000 per month, take that information with a grain of salt. Quite often, a seller will launch a site with a WSO (sales page in a popular marketing forum), make some quick revenue and then list the site with revenue claims from the proceeds of the WSO.  Very often, the WSO has run it’s course and the income level being claimed is not sustainable.  Look for a consistent history of earning for at least six months.

5. Conclusion

Nearly all website sales listing lies or exaggerates about something or conceals important information about the site. It’s up to you to distinguish between real, verifiable information and information that is incomplete or misleading. Bear in mind that due diligence will vary based from site to site based on the type of site it is, traffic sources and revenue streams of the site.

Finally, when buying a website for any significant amount of money, always use an escrow service. Escrow services protect both the buyer and the seller.

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Where to Buy and Sell Websites

buywebsites
I’m sure most people who are thinking about flipping/selling or buying websites know about Flippa, but when the question is asked, where can I sell my site, that seems to be the only answer people give. Flippa may be the largest at this time, but it’s not the only game in town. Due to the many changes Flippa has gone through with pricing structure and other changes that don’t necessarily benefits sellers, it’s worth a good hard look at the other places for buying and selling websites. Flippa does have an advantage over others with probably more buyers who search the site, so it’s still a viable website marketplace, but it’s always good to know all the options available.

There are also a fair amount of brokers who can help you to sell your websites, particularly if they are well established businesses that have established revenue and traffic and are valued at $10,000 or above. Brokers will often help with creating the listing or sales copy for your site and listing it at various resources both offline and online. They may also help with screening buyers, legal paperwork, and helping with negotiations and prospect questions when a buyer is interested. They often have developed a large list of buyers that they will contact about your sale.

Here’s a list of some website brokers:

Latona’s Website Brokerage
Quiet Light Brokerage
Acquisitions Direct
Acquisitions Agency
Maine Business Brokers
We Sell Your Site
W3 Business Advisors
We Broker Websites
Flipping Enterprises
Website Properties, LLC
Trusted Site Seller

Here’s a list of places to list your websites or look to buy websites.

Flippa

Currently the largest. Here’s the new pricing.

Listing fee for established websites & domains $29
Success fee for established websites & domains 5.0%
The success fee is paid by the seller when they make a successful sale.

Listing fee for new websites $9
Success fee for new websites 15.0%
The success fee is paid by the seller when they make a successful sale.

If your sites sells, there’s no real advantage in price between listing it as an established or a new site. In fact, if your site sells at a certain price point, using the new site listing could cost you more than the established site listing, so be aware of that when you choose which pricing to choose:

Your site has to sell for $200 or less, or your overall costs are higher due to that 15% success fee.

On a $100 sale:
$29 listing, $5 success fee = $34
$9 listing, $15 success fee = $24

On a $200 sale:
$29 listing, $10 success fee = $39
$9 listing, $30 success fee = $39

On a $400 sale:
$29 listing, $20 success fee = $49
$9 listing, $60 success fee = $69

On a $600 sale:
$29 listing, $30 success fee = $59
$9 listing, $90 success fee = $99

Traffic on Flippa can be pretty low in the beginning of an auction. Buying the enhanced featured listing can increase those views. If you do go that route, don’t buy it until the last day or two as that’s when people actually start bidding on most auctions on Flippa. You’ll notice a pickup in traffic also when it’s listing on Ending Soon tab.

The kinds of sites that sell well on Flippa are sites with established revenue. I was somewhat surprised at some recent sales below that appeared to sell for too cheap if the revenue is accurate. I didn’t investigate these listings very much. Just noted that they seemed to go too cheaply for sites with that kind of revenue.

REVENUE SOLD FOR
$599/mnth $2,249
$5,926/mnth $17,000
&20,000/year $8,000

As you can see from the above if the revenue numbers are legitimate, those sites should have sold for more money. So if you have a site that is making a solid income every month and has a history of doing so, you might want to consider a website broker. The commission will be higher, but the selling price will also be higher, in many cases, a lot higher. A broker could be well worth your time if you have a website valued at $10,000 or above.

Website Broker.com

This site gets a lot of traffic due to it’s high position in the serps for the terms buy sell websites. It ranks just below Flippa in the serps. Standard listings are available for 90 days for $9.95 and premiere listings cost $29.95 and give you more exposure than the standard listing. For listing just domains, the price is 90 days for $9.95, and premiere listings are $14.95. There are no other fees … no “success” fees, no commissions. The Premiere listings are listed in the Premiere Listing section of the site and will also appear at the top of their respective categories. They are bolder so they stand out more than standard listings and have a higher click through rate.

Buy Sell Website

The cost to list your website for sale here is $39 for a 2-week listing and $59 for a 3-month listing. It’s a well established site with plenty of listings and traffic. Don’t be put off by the ugly design (they should probably have hired a real designer to design the site).

Daltons Business

The UK’s largest business for sale marketplace. While they have a large amount of offline businesses for sale, they also have an Internet business for sale section.

Businesses for Sale.com

Pretty interesting looking site with website for sale listings in all countries. Has over 61,000 listings at this time.

Experienced People Forums

Forum for both website listings and information on buying and selling websites. Moderated to keep the spammers and scammers out. Doesn’t look like a lot of traffic but the site comes recommended by other website flippers. There’s a private VIP section which they say has all the good information but you don’t have access until you reach a certain (unknown) amount of non-fluff posts (which I haven’t yet).

BizSale.co.uk

Another UK based site that you can buy or sell offline small businesses. There’s also an online or web based business section.

Webmaster Talk Forum

Popular webmaster forum with a section for listing sites for sale.

The Warrior Forum

A lot of turnkey sites being sold in the Complete Sites for Sale section of the Warrior Forum. Can occasionally find some established sites listed here also.

Digital Point Forums and Ebay

I’ll group these two together. I don’t recommend either one. Too much spam, too many scams. ‘Nough said.

Posted in Featured, Website FlippingComments (2)

Flippa Due Diligence Could Save You Thousands

If you’re thinking about buying a site on Flippa, you must … must …. I repeat, must do due diligence. This Flippa scam I’ve seen so many times it isn’t funny. The seller will buy some cheap crap blog from Tradebit for less than $5 and put it on a $10 domain and then list it on Flippa. This is allowed because the seller isn’t claiming that it is unique content or design, but it is a scam none-the-less.

Here’s an example. The listing below is a Flippa listing with a BIN of ONLY $1,500.

Flippa scam

Here is the same blog on Tradebit for $3.97.

Flippa Scam

Obviously, with no income and no traffic, it’s not likely that they’ll get $1,500 for it, but it’s not worth more than $15, which is what you can get it for through Tradebit and a domain registrar. Now look at the sellers profile on Flippa. Look at their listings closely. This person sells the same sites over and over again only with different domain names. Here’s another listing with that same blog.

This seller loads these listings up with all kinds of “bonuses” which should justify the high cost of these duplicate sites, but I highly doubt that there is any real value in those bonuses. The listings of this seller reads like the script for a sleezy used car salesman.

Be sure to check out the sellers profiles before you buy and look for duplicate listings. Also do a Google search and see if you can find a Tradebit blog that is the same, as this is a very common Flippa scam.

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