Secrets to Buying Established Websites for Profit

This Post: Secrets to Buying Established Websites for Profit

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you hi everyone my name is Matt meats give each the co-founder of a couple of different online companies the first company I started when I was in high school it’s called sigh poin comm which is an online magazine for developers and designers and over the last 12 years of that business we’ve spun out to other businesses one is called 99designs which is a marketplace for crowdsource graphic design and the second business is flippa.com which over the past two years has become the go-to place for buying and selling established websites so my topic today is buying and selling established websites for profits it’s a really emerging industry it’s very young and not many people are doing it the valuations for buying websites are very very attractive and anyone in the internet marketing or affiliate niche can really benefit from knowing about buying websites as a traffic acquisition channel as opposed to just doing SEO or buying pay-per-click traffic or building email lists so why buy websites a couple different reasons first and foremost there’s revenue yield when you’re buying a website you’re buying an established business most of that time that business includes ongoing revenue second reason to buy websites is capital growth you can buy a website for $2,000 you can spend months and months collecting a paycheck from different affiliate programs or ad networks and then when you’re done with it you can actually go out to the open market and sell that business oftentimes through much more than you bought it for initially there’s fantastic opportunities around buying websites improving them collecting a paycheck in the mean time and then putting them back out there on the marketplace and making a nice profit buying established websites can also be a fantastic way to generate traffic as opposed to just buying purely pay-per-click traffic or doing SEO or doing JV partnerships and finally people also buy websites for search engine optimization because often times when you’re buying a domain name again lots of inbound links to that domain name you’re getting fresh original content so on and so forth so when you’re buying our existing business valuations are we’re now a very very attractive the majority of websites sell for less than two years worth of revenue and many many web I sell for less than six months revenue and later on in my presentation I’m gonna go into some case studies showing you some of the absolutely fantastic bargains that can be had if you’re willing to put in the time and effort into finding them the other good thing about buying websites as opposed to speculating in domain names is you’re actually buying yield the domain names are really hard to resell if you look at the domain name market places such as moniker com great domain see though after nick all those you’ll see that they have millions and millions of domain names listed for sale at any given point in time however the vast majority of those domain names go unsold in any given month because they’re really really hard to value how much is a domain name worth you know it’s entirely up to the buyer there’s no real clear valuation metrics that’s completely different from their website space on flippa.com for example we have a 57% sell curate meaning that 57% of all auctions and with a bid above the reserve price within 30 days which is completely different from speculating and domain names where you might never be able to find a buyer for your investment capital growth most of the people in this room are obviously quite good affiliate marketing monetization SEO etc those are huge opportunities around increasing the value of a website that you buy by making simple and easy fixes to the site it you’d be amazed at some of the low-hanging fruit that pops up on Flippa and other marketplaces people just have no idea how to make money online they got lucky they built a good website they built a following they created fantastic content about something that they’re passionate about but they’ve never been to a conference like this so when it comes to SEO or a different ad networks or monetization models they have no clue and many times I’ve seen case studies where someone buys a website and within 30 days they’ve doubled the monthly revenue which is absolutely fantastic and you can’t really do that with domain name acquisitions traffic generation is another really really big reason for buying websites odd this conference we’ve heard about email marketing PPC SEO all these other methods for getting traffic but buying websites is another really effective meth when you’re buying a website you’re essentially buying an audience if you’re spending $2,000 on Google at 20 cents a click you might get 10,000 visitors and that’s it your $2,000 is gone don’t get any more traffic and your more benefit after that but if you’ve spent two thousand dollars buying a website that gets 10,000 eeks per month you can collect that traffic month after month after month you can grow that traffic month after month after month and when you’re done monetizing all this traffic you can actually go back out there and sell the website and get your initial $2,000 back or maybe you’ve done really well monetizing the website and now you can sell it for $4,000 so it’s an incredibly attractive value proposition for those that are willing to take the time to learn it about this space search engine optimization a lot of people you know obviously are trying to rank high for different keywords that’s free traffic if you’re buying websites often you’re buying all the existing rankings that come along with it I’ve seen people buy websites and just use those websites to link back to their own network of sites and pass through the PageRank I’ve seen people just do straight through your one redirects in order to get better rankings on Google and you with most website acquisitions are getting a lot of keyword rich content that you’re able to reuse in many cases there’s lots of low-hanging fruit most of the websites that we see if sold on Flippa for example or using WordPress by the ninety five percent of all cases those websites aren’t using any of the SEO plugins that help optimize your blog so just buying up existing wordpress blog doing going through putting in all the as necessary SEO plugins we can get very quick results in terms of growing traffic why aren’t more people buying websites the majority of people just don’t know this opportunity exists there’s lots of books and ebooks and Clickbank products on email marketing and SEO and all these other topics there’s very very little content out there about buying websites in order to monetize them people are also afraid of buying websites because they don’t know how to do the due diligence and that’s something I’m going to go into my presentation but there are definitely risk associated when you’re buying a website you’re buying a business and there’s always potential for fraud so it’s important to know how to protect yourself before you go into the space and finally people aren’t knowledgeable enough where they’re just scared that rather be buying clicks on Google for 20 cents apiece rather than buying a website outright where to buy websites there’s basically three different ways to go about it you can go straight to their website owners you can go through brokers or you can go through a couple online marketplaces one of my favorite places to hunt for websites for sale is dmoz org demos for those that don’t know is a directory that’s curated by volunteer editors and are categorized by topic so you can go in there find top websites about topic websites in your niche and then contact those website owners to see if they’re interested in selling the great thing with dmoz is if someone spent the time and effort donor to get listed in this directory they usually spent a little bit of time building out their website as well so there’s a certain level of quality assurance as opposed to just randomly hunting around the web for websites for sale one really good tip off that website might be for sale is looking at the copyright footer and the last post date if a website hasn’t been updated in six months a year or two years it’s very likely that the seller will be open to any and all offers that come their way in fact they’ll probably be thrilled to sell the website to you because they’re tired of paying the monthly web hosting bills when you’re contacting website owners you can just go through the contact form or try and do a Whois search to find their contact details if the Whois database lists a phone number sometimes that’s a lot better than just emailing because emails bounce or go ignored or get filtered into the spam folder the one really really big downside to this as your success rate will be really low you could contact 20 30 40 50 different website owners only get couple we only get a couple of responses back and only make one deal so it can be very time-consuming the other thing to keep in mind with this method is gonna be a very long lag time just this morning I was checking my email and I got a reply from someone that contacted like four months ago about their website now they’re finally ready to sell but when I contacted them four months ago they weren’t so by going through this method you’re essentially putting a lot of seeds out there and over time some of those will come back to you in terms of potential deals that you can make website brokers there’s been a emergence of different companies and individuals who make a living and collect Commission by brokering large deals they typically work with six-figure properties mean websites are worth at least $100,000 or more because otherwise there’s not enough Commission in it for them to make it worthwhile there’s three companies in particular that seem to be doing quite well in this space one is quite light brokerage second one is we sell websites and the third is website properties calm one thing to keep in mind with these brokers is once in a while the hospital sign a nondisclosure agreement before they give you the details about the particular clients that they’re representing but you can still go on their website and getting ideas to what’s on the market what sort of valuations and asking prices exists etc one really good thing about this as well as you can get some really good ideas for your own businesses just by spying or spying on what other people are doing if you see a website in your niche being sold the seller usually has to disclose a lot of information such as how they’re making money how much money they’re making whether traffic is like what are their traffic sources I can just go in there steal those ideas and apply them to your own businesses and the same thing applies to all the websites being listed on Flippa com I don’t mean many people just visit our marketplace just to see what you know what sort of traffic sources people are using where they’re getting interesting link backs so on and so forth and finally you can go to dedicate the marketplaces or forums where people are going in there and specifically listing their websites for sale through an auction flippers the biggest there’s website broker com they also go some of the more general market places like biz buy sell calm businesses for sale and finally there’s a bunch of forums out there such as DN forum and digital point which has a very active or sales section the only thing that sucks about most of these marketplaces is there’s very little search and filtering capability so you’re gonna spend a lot of time just going through the listings one by one trying to find the ones that worth spending additional time and effort on but the good thing is you can find some real bargains out there as I’ll going to later evaluating websites for sale you can use a whole bunch of third-party tools some of which I’m gonna list off you do due diligence on their website itself its traffic and revenue sources and finally you want to conduct due diligence on the seller who are you dealing with where are they what’s their history like has anyone complained about being scammed by them in the past here’s a couple of my favorite tools for doing due diligence a couple of these are for SEO research my two favorite ones on here our coffee scape copyscape for those that don’t know is a tool that basically will tell you whether or not the content is duplicated someone’s selling you a website that’s full of scraped and duplicate content exists on a hundred different other web sites on the Internet you want to know that before you plunk down your hard-earned money the second really really interesting tool on here is the Wayback Machine the Wayback Machine basically archives websites over time it crawls a website every week or every month and takes a snapshot to see what it looked like at that period in time if you’re buying a website that’s two three four five years old you can go in there wayback machine and see what the website looked like what has that domain being used for has this always been a car for him or was this once a porn site for example you can also find out what sort of things the website owner has done to try and monetize the website in the past for example when someone is selling a website they might not tell you that they’ve previously tried and failed using Adsense but by using the Wayback Machine seeing that they had Adsense ads on their site six months ago you can find out and ask better questions doing due diligence on SEO and link backs is very important suggest a case study on a random mortgage website that was sold on flippa.com the site had 50 backlinks in google nothing too exciting but when you actually did a search in Google to see where those links were coming from you got some really interesting results the first list the first search result here is a music website why is a music website linking to a mortgage site you have to ask yourself you dig deeper and deeper and you find out that the website owner has been spamming the comments basically to build their backlink profile all well and good but you have to be aware that you’re buying this website it’s going to get penalized in the search engines at some point if it has been already so it’s really really important to know where the backlinks are coming from to the websites that you’re buying and are those backlinks gonna remain valid and in place after you buy those websites one thing that I’ve seen a couple of times is where the seller owns 30 or 40 different websites they cross link all the websites they sell off one of those websites in their portfolio as soon as the sale is completed they pull down all the links to their website from the rest of their website properties so you want to ask the seller whether they’re doing any interlinking across their domain name portfolio and why are those links will remain in place after the purchase really really important otherwise you could be dropping from the first page of Google to the middle of nowhere very quickly and you find yourself losing money a couple other things to look for when buying websites on football comm we do something really cool which is called verified Google Analytics basically we ask the website owner to grant us access into their Google Analytics account we go in there we pull out all the data and then post it publicly on our marketplace the reason why we do this is because in the past people have faked screenshots Photoshop is very easy to use people also have taken the statistics from one website they owned change the URL and said this is what this website looks like so it’s really important to know that the traffic size you’re looking for actually for the website that you’re buying another really cool thing you can do is you can check the robot dot txt file robots.txt basically allows website owners to exclude certain pages from being indexed in Google sometimes you’ll find some really interesting URLs listed in this file and you can just find out more about their website in the web site seller by seeing what sort of things they have on their domain name that they might not want to be getting indexed by Google walking through a sites revenue streams one thing that many buyers do especially on larger purchases as they do a screen share through Skype or I chat or go to a meeting or whatever and they have the seller actually go through a live demo logging into all the Adsense accounts into the siege accounts and showing them all the numbers behind their website it’s still possible to fake but it’s a lot lot harder than just editing a jpg file and Photoshop over to fake revenue numbers and finally it’s really important to understand all the factors are driving us websites revenue and traffic for example I mentioned portfolio interlinking as being an important factor to look for knowing where the backlinks are coming from as their seller Dulli doing any pay-per-view advertising or to pump up the traffic before selling their website so on and so forth another case study this is an I cranks calm web site this seller were saying they made 350 bucks in 14 days and claiming bulletproof earnings however if you went into the Google Analytics this is where the traffic stats looked like the web site was completely flat getting almost no traffic until just before they listed their web site for sale that should be a really really big warning flag when you’re looking at sites traffic history it’s important to go back as far as possible and look at the long-term trend and the best in the vast majority of cases when you’re selling our website you’re trying to present yourself in the best possible light so you’ll take your best month of revenue your best month of traffic and you’ll try and tell people that’s the way it’s always gonna be well it’s since I’m going to look at the long term traffic transfer website this is looking further into this I Kranks website in Google Analytics has an 85 percent bounce rate really really high 85 percent of the people coming to this website are viewing a single page and then pissing off 92 percent of the visits are first-time visitors big warning sign no repeats traffic and out of 50 15,000 visits this website 81 percent of those are direct type and traffic that’s really really suspicious direct typing traffic is when someone’s memorized your URL bookmark your site and types it in means you’ve basically developed a great brand name but if you’ve developed a great brand name then why would you have an 85 percent bounce rate and why would 92 percent of your visitors be first-time visitors if it’s mostly direct traffic huge huge warning site there and finally if you look into the country list something really important to do some time if you’re don’t look at you see that most of the traffic is from Nepal a huge warning sign it’s where’s your traffic coming from it’s great if you’re buying a website with a hundred thousand unique visitors it’s less great if they’re all coming from Bhutan or Tibet and of those fifteen thousand page readers website fourteen thousand of those archers single posts about infrared infrared lasers huge warning sign of all the traffic’s coming to a single webpage in this case it’s most likely that the seller started buying a whole bunch of pay-per-view traffic just to pump up if they’re listing before they sold it and it’s all fraudulent so I wouldn’t have bid on this website but someone did finally in terms of evaluating websites besides looking all the traffic numbers the SEO profile the analytics the monetization methods you want to know who you’re dealing with on the other end often times it helps to have a conversation on skype or on the phone even suggesting having a conversation on skype or the phone can scare off many pratense many potential scammers they’ll trying to avoid you or make excuses about time zone differences or their grandma being sick or whatever I’m getting proof of identity in many cases people have for passport scans or even notarized documents from making larger purchases for websites one of the things we provide on Flippa is actually a sales contract so before you transfer the money to someone you can have him sign the contract you know and listening their identity either address having them you know confirm in writing that everything they’re disclosing as part of those thing is true and accurate I always recommend googling the sellers real name you’ll often find a lot about them and their past history and dealings and whether people have had problems with them in the past but you can also google their username on Flippa many people when they register for different websites or forms have a particular Indic name or handle that they use and once someone has selected nickname or handle the temptu you reuse it over and over and over again again it’s different on different services in different forums so by googling someone’s handle you can see what else they’ve been up to on the Internet check their seller feedback if there is any and finally know why they’re selling oftentimes people are selling because they have other priorities people in flip-out often sell their websites because they want to go on vacation pay for the kids college education buying a new car whatever other people simply have you know dozens of websites and their portfolio and they just don’t have enough time to manage all of them so once in a while they’ll like a website of their portfolio and listed for sale but it’s important to know the reasons why they are selling in many cases you’ll actually uncover a downwards trend and the revenue and traffic that’s something to keep in mind when you’re placing your bids and deciding how much money you want to spend and finally some case studies about some of the awesome opportunities exist on the flipper marketplace just a couple listings PDF King City of mafia Health News com PDF King is a huge document library of like free and open-source PDF documents this website was getting 1.2 million pageviews per month 600,000 uniques a lot of traffic the owner of this website really sucked on monetizing I didn’t see it as control of their homepage there it’s not even a single ad unit on the above the fold therefore they’re only making $1500 a month it’s probably a fraction of what they should be making given all the traffic they get and this website sold for only $11,000 $11,000 for 600,000 uniques even if all you do is put up a huge lead gen form on that home page you’ll probably make $11,000 in a month or two I mean it’s so cheap even if the traffic’s untargeted you can throw any offer out there or 600,000 uniques per month something will stick and you’ll get a decent amount of revenue out of it I mean 2 cents per unique visitor you can’t buy traffic in India on Facebook for that it’s gonna cost you more it’s absolute bargain city of mafia some multi-user online role-playing game this guy gets two million pageviews per month very very high engagement this website sold for sixteen thousand dollars less than four months profit I mean if you’re able to take this website increase revenue a little bit you can get your money back in two three months and be out or flip their website if you’re able to double the revenue you can go back on flip and sell for thirty or forty thousand dollars just really really quick another screenshot of their home page again no ads someone created something cool they got lucky they get traction and pageviews and visitors they have no real idea how to make money from it amazing opportunity for the right buyer healthy news.com some health lifestyle blog you know anything about the health lifestyle niche you know I knew 29,000 unique visitors per month is not that easy to get that’s quite valuable traffic so a lot of affiliate offers that you can run on this website I think in this case the owner was just monetizing using Adsense didn’t have any affiliate or CPA type offers on the site and again you’re looking at screenshot of this site I can’t see a single ad unit above the fold they don’t even have a 728 by 90 banner next to their logo just absolutely clueless but a lot of content on this site some good search engine rankings etc and this website sold for 2000 and dollars what can you do with a hundred twenty-nine thousand unique visitors per month and the health niche to make more than two thousand dollars I can think of six thing six things on the top of my head right now means fantastic easy opportunity just money for the taking 4g tuner calm again many people develop websites based out of a passion as opposed to a way to make an income and earn a living this guy is passionate about Mitsubishi cars and tweening cars and improving horsepower blah blah blah he gets a hundred sixty thousand page views per month from twenty thousand unique visitors these are hardcore enthusiasts people who spent thousands and thousands of dollars buying aftermarket parts for their cars and its website sold for only thirty four hundred dollars sixteen cents per monthly unique visitor again this guy was doing basically nothing to monetize the website doing no deals with any car parts companies no sponsorships from car companies absolutely nothing again a screenshot of their home page I can’t see a single ad unit above the fold it’s just free money for the taking someone had passion for Mitsubishi cars built at a forum got a large following members but no way to monetize it and I think my final case study here so I’m gonna leave lots of time for questions at the end this is a popular architecture blog this guy has 1700 pieces of unique content could cost you a fortune to replicate hundred thousand unique visitors per month 200 thousand page views really really valuable traffic architects architecture students I love things in that niche that you could sell them and this blog sold for $15,000 or was a PageRank 5 site over 200 backlinks pretty good domain name or key central com nice design absolutely nothing done around monetization very little ads etc Belov great content care host able bloggers that were regularly contributing to the site and he was even paying most of them and that all came with a say for $15,000 so let’s just give you some of the ideas that exist on the open market obviously not every single deal will get listed on a marketplace like flippa sometimes you have to go out there and find those websites I have high search engine rankings but have been updated in a while find those demos listed sites that have been abandoned a long time ago but are still gaining traffic and page routes on an ongoing basis etc a couple further resources for you we’re offering $10 in flip up credits on our website if you’re creating a new account and use affiliate SCM as the code we’ve also developed a really cool tool called the keyword ranking report so on Flippa com we have a thousand listings in a given week so four thousand listings at any given month trying to go through all those websites one by one and trying to find the real gems in there can be really high so with this keyword ranking report we were going through all our listings and telling you which keywords the particularly doing the main aims have a high ranking for in the organic search results and we actually sorted by keyword popularity as well so your ranking number five for keyword that gets searched a hundred thousand times per month don’t show up near the top of this report and you can sort and filter in all sorts of different ways we also have a newsletter called the flipper a list where we manually sort through all the listings now marketplace and identify websites for over ten thousand dollars that have high potential meaning they have a lot of revenue a lot of traffic a lot of users email lists really good domain names what have you again this is just one tool to find those listings that you might otherwise skip over because of the volume of information out there on the web and as News is completely free of charge and we feature seven to ten different web sites in there every single week if you have any questions we can you can go up here to the microphone or you can email me or contact me over Twitter but yeah that’s it for me I think it’s a really really good time to be doing this over over the next couple of years I think the valuations on websites will be going up a lot if you can buy a website it’s a hundred thousand uniques for a couple of thousand dollars I mean it’s a bargain of a lifetime eventually other people will discover this and start bidding up the prices quite significantly I think right now buying and selling websites is we’re buying and selling domain names was back in 2001 in 2002 and which who of us here doesn’t wish they were back on the web in 2001 2002 trying to buy as many domain names as possible then we had the same opportunity right now with websites the analogy I always like to use is that no domain names are like vacant land like raw undeveloped land really hard to value really hard to sell but the websites that say on top of those domain names are like rental apartments they’re much easier to value you can apply valuation metrics such as multiples of earnings multiples of revenue you can get appraisals done we’re actually building out a pretty impressive valuation tool based on the fifty five million dollars in websites that we’ve sold on flipper com so very soon you’ll be able to come in to flood back enter in the details for a website that you’re interested in and will tell you the range that it’s worth or should sell for on the flipper marketplace based on all the historical data that we have on that topic actually do have one last tip one scam that I’ve seen a couple of times is there’s all these free website valuation tools on the internet that basically crank out numbers saying Yahoo is worth five million dollars and 99designs worth fifty thousand dollars and all these things and sometimes I’ve seen sellers try and use those fake evaluation reports to try and pump up if their asking price and inflate their asking price and try and trick some naive buyers into overpaying for a website so whenever you’re looking at a website appraisal reports it’s really really important to know what that data is based on all the free website valuation tools I’ve seen on the internet so far just look at backlinks and PageRank and then they try and calculate some random website value based off of that which completely doesn’t make sense because they don’t even know how much the website is making or what niche the website is in or anything like that so it’s it’s completely useless which is why we’re developing our own tool with a couple of PhDs out in Melbourne Australia who are able to do all the historical analysis and all our data and come up with some more accurate numbers or at least accurate range for website valuations but again I think valuations will start creeping up as more and more people discover this and also newbies entering the market you know rather than trying to build a website from scratch they’re probably all better buying a website for a thousand or two thousand dollars and getting their feet wet that way so I see a lot of newbies entering this space as well and buying up some of these lower and web sites have a bit of traffic and content yeah if there’s any questions please come up to the mic we’re recording so any questions does anybody want to share any experiences and buying websites or any tips I’m at thanks for speaking with us Misha from San Diego where is the most ripe niche here because I know at a certain valuation point you probably have bigger investors and people where the marketplace is more efficient what range do you feel price range in terms of acquisition price is the ripe niche where the most opportunity is I think the most opportunity exists between like three thousand and twenty thousand dollar price range can buy some websites that get hundreds of thousands of unique visitors per month some good content without over paying the evaluations are really really though so you you’re not to spend a lot of money once you get up into those six-figure websites and once you start working with some of those website brokers I mentioned earlier the valuations creep up rather rapidly once you’re buying a website for half a million dollars you’re not paying two times annual earnings you’re paying four times or six times annual earnings just because you’re dealing with a whole different set of buyers so think of sweet spot is under $20,000 right now and do you have any context in terms of at what point the real the more sophisticated buyers start to come in like the private equity funds and those types of like I mean is that over a million or where the terms of private equity I think they sort of come people start coming around a quarter million dollars or half a million dollars there’s so much more serious cash that buyers in that space the thing is I buying a website that makes $5,000 a month I think it’s just as much time as buying a website that makes $50,000 a month if you’re sitting on our huge stockpile cash they’re trying to efficiently deploy it’s a lot easier to do it in large chunks rather than doing lots and lots of small deals if you have a lot of money in your pocket but I think for most of us here or better all buying of three websites for $10,000 each and you know diversifying a little bit and optimizing that way Thanks so this this question specific to like flip by so it’s been a few months since I’ve been on flip but I noticed a lot of useful things on it but one of the things that made it more difficult to find the really good sites is that there’s a lot of like turnkey or like autopilot sites on there like one example that the only one I can remember off the top of my head like there’s a lot of like iPhone unlock sites and it’s like someone will make the site buy a lot of traffic to it and just show like some real revenue they’ll sell it and then you’ll notice that they’re two months later they’re putting on like a very similar version and and they’re basically like repopulating it over and over again it’s like if you had bought the first one you’d get screwed and then the other category was all like those blogs which are like basically like WP robot they just like quickly get traffic and it’s just like spammy stuff but the havoc real numbers and it it just blocks like like all the other good deals so like is there something that you guys are doing to try to you know remove those I know you have a lot of filters and stuff which helps get out of it but it’s there anything like new that you guys have done to you know try to like sideline those yeah yeah you’re absolutely right there’s an entire industry of people just creating websites for the sole purpose of selling them and it’s basically a race to the bottom they’re creating all these WordPress Auto blogs with no traffic no revenue a year ago those websites were being sold for 400 or 500 dollars now all those websites are being sold for like $200 so it’s an absolute race to the bottom who can develop these websites the quickest and the cheapest eventually this market will just fall apart it’s not really sustainable on Flippa calm in the past two weeks we rolled out a much much better search functionality it’s much easier to use if you go to flip a homepage all the listings on there people who have paid like at ninety nine dollar upgrade fee to get listed on the home page so that automatically by default filters out all the blog’s they’re only gonna sell for $150 because there would be no margin left in it for them on our just sold tab which is actually another really cool resource I have mentioned we have a just sold tab where you can actually see all the reasons transactions I’ll what under what the selling price was so before you go in there and start bidding can be helpful to monitor the just sold tab for a couple days or a couple of weeks to get an idea for valuations and when things are selling for but yeah on football comm for the autoblog we’re just rolling out improved search functionality trying to you know weed out those sites through more aggressive pricing so that the more serious sellers have a chance of standing out we created the ælis newsletter to try and filter through and just you know pick the top cream-of-the-crop listings every week and that deliver those straight to people’s inboxes so they’re not having to show through you know fifteen hundred auto blogs okay thank you my name’s Ross with click interactive oh yeah I purchased a site probably two years ago on Flippa and I was the winning bidder seller ended up selling the the website to an interim buy or another buyer besides me as the winner and flipper tried to charge me for winning the website right now there’s a commission fee or something so I was actually blacklisted or removed from your your website and I I tried to complain through your customer service channel okay and they demanded payment but I never obtained the website completely payment yeah if you give me your business card we can sign it out afterwards hey Matt I just want to know if you have any questions for those of us who are maybe considering selling a website on Phillippa for the first time you know ways to attract quality buyers and how to beef up your profile I’m sure a lot of the same information but you know any tips for first-time sellers yeah the first time seller I think I’d be starting off with a relatively low minimum bid priced to get activity happening in computer fuel engage in the process if you’re starting off with a ten twenty thousand dollar minimum bid the last few people that will start bidding at that price point by being get a whole bunch of people interested at $2,000 or $3,000 and they’ll start competing against each other because they’ll be afraid of losing same principle applies to eBay auctions the other thing I would suggest is real loud auctions are up to 30 days long most cases that’s absolute overkill we found that less than 14 days is the ideal amount of time to run an auction for – that people just start getting disinterested and definitely use all the available tools on Flippa to like verify ownership of the domain name verify your Google Analytics stats make sure you tagging your option properly so that people can find it and during the last couple of hours of your auction I would be buying the featured upgrades get listed on the flipper homepage there’s a lot of people that just look at the listings on the homepage when deciding wants to bid on one other tip and we don’t share this often as you can actually set your auctions to manually approve each bidder so rather than Auto approving each bid you can have you can have it set up so you can talk to the bidder before you approve their bid and have entered into their system and on Flippa column we have this view or filter that shows you the most active auctions on our marketplace a lot of buyers are just looking at what are the most active auctions those are probably the most interesting websites to buy a quick way to get listed on that active auctions filter is to wait until you have a bunch of bids pending approval then you go in there and approve three four five bids all at once and once well swoop and then you’ll show up on the most active filter on Flippa that I can bring a lot more attention a lot more people into your auction otherwise might not have seen it I’m at Fahad Kanpur reply com a quick question around revenue optimization so I think one of the case studies you should was PDF King for example and one of the issues was that they weren’t putting up ads above the fold and you said something along the lines that it doesn’t matter what you put up you know it just puts something up whether it’s a lead gen form or an ad or something yeah so my question to you is you know what what is it’s probably subjective question but what is a good testing period to try out different offers you know is it a certain you know monthly unique count that you want to hit to see okay this act performed better than this ad or is it you know like a week on how do you what’s your personal take on it you basically want to get to statistical significance so in most cases you want to look at the number of action that happened in each each each monetization medium number of collections a number of leads submitted and you want to make sure there’s enough of a difference between the numbers to make it statistically significant be running to lead gen offers one gets 28 submits the other one gets 30 submits that’s not statistically significant you’ll need a huge sample size before you can be confident but as a general rule of thumb you know you want to get to 10,000 page views for an offer before you get you know a decent idea as to how it’s going to perform oh hi Matt you know I enjoyed the presentation a lot the question I had was what happens on some of these big sites like PDF King there’s a lot of infrastructure that supports all showing PDFs yeah so how about servers and things you know how do you translate that to the like if I buy PDF King and I find out that the hosting cost me $10,000 a month we ask the sellers to disclose their expenses for running our website as part of the auction listing so you definitely want to you know maybe repress copies of the last couple of invoices before you submit a bid one thing I should actually mention in terms of expenses people never list their own time as an expense if they’re selling a website that takes them 20 hours a week to run they’ll still say it’s profitable even though their way because they don’t value their own time at zero so it’s really important to also ask how much upkeep is involved in a website because I can greatly affect your profit but in terms of transferring hosting what most people do is they share the login details for their web hosting account someone will give you their Hostgator login password you need to go in there you change it over to your credit card details and you change the password and the account is yours and the website is yours now you don’t have to move deal with transferring files and that’s usually when things really get broken and messed up when you’re dealing with databases or larger volume of files so it’s usually just easier to transfer over the web hosting account ownership as opposed to trying to actually physically move hosts if you do want to physically move forwards I transfer over the account first make sure everything is running smoothly and in a later stage as a second step switch web hosting to Amazon Web Services or Rackspace or what have you so this would be before you purchased a site and you’re on skype and you’re doing kind of a screen share and you could see it at that point yeah say can you please login to your hosting account show me how much you’re paying per month and then you know get them to agree just to transfer ownership of that account as part of the sale process as opposed to just emailing your PDF file with you know hundreds of thousands of files and MySQL databases and you having to try and get that working on your server which can be really really messy great thanks this is on selling your website it’s a little hard sometimes when you’re evaluating a buyer because you don’t know you know you have two plus one two three four or five but it’s hard to know just one thing I would like is more verification on premium buyers you know a little bit more I know you have like a are you able to bid five thousand or ten thousand or something like that just yeah I could see that yeah we have a my yeah we have a new feature in the past couple of weeks where I think if you’re bidding above five thousand dollars we have we pre authorized the bidders credit card and just that’s just a way of filtering out the riffraff and trying to make sure people are a little bit more serious trying to verify their identity so we have a name on the credit card in a billing address so that’s been quite effective one other really cool thing that we have for like super premium website sellers is you can do basically an anonymous auction where you require people to sign an NDA before you disclose the URL of your website for sale that’s something that’s come up again and again over the last two years people have large websites and large communities and they don’t necessarily want the entire world to know that they’re for sale because I could actually lower the value of that asset so on Flippa you can now do these private auctions where potential bidders have to sign an NDA before they know the URL of a website for sale and we found those auctions to be incredibly successful and those usually end up in sales of six figures and higher also I’ll put in a suggestion if you’re selling a website best way to get a lot of bids and a jack up the price started at no reserves then more people are bidding on it yep very good tip one thing that happens as well whenever you’re running an auction is you’ll have a lot of prospective bidders asking you about your reserve price which I always find very very odd the reserve price should be a secret you want people bidding even before hitting the reserve pricing of them engage in the process so if you’re holding an auction and selling and people start asking you what your reserved prices they should just refuse to answer that question and encourage them to submit their best offer and get them started in the process I had a quick question about maintaining value for the buyer and still maintaining a high closing price for myself in the last six months I’ve noticed as you said a lot of people go in just to do due to due diligence anything else for example they’re they’re seeing that a key word gets X amount of traffic I’m making $1,200 a month via Adsense is there any way to protect the buyer from having a lot of copycats trying to outrank them as soon as as soon as I saw them the site unfortunately there’s nothing you could do right someone can always find your website don’t Google see that you’re ranking high and trying to copy you off and that is a big downside because on Flippa you’re also disclosing your revenue and you’re showing how profitable particular keywords or niches are but yeah it’s it’s an open market there’s not much you can do to get stop copying unfortunately if you have a really valuable website then I would encourage you to use the private listing function so that your URL is hidden and not publicly disclosed until people sign an NDA and that way you can approve people manually and only have a couple dozen people looking at your auction as opposed to hundreds or thousands for mid-range prices you know let’s say between five and twenty thousand dollars do you find that adding the NDA requirement drops the end closing price I don’t think we’ve had people add NDA’s for websites in that price range no it tends to be six figures and higher okay thanks any other questions one more hello I’m classy Olson I have a question I’ve got a just an example what you put on my computer links comm they have a website is quite a good name what do you think of these types of websites they ask her 1 million euros or dollars for the website how do would you tackle this problem to evaluate their due diligence how would you tackle this well links coms obviously a very premium domain name I mean the domain name alone without any traffic or content to it it’s probably worth a couple hundred thousand dollars as a minimum if you try and if you’re the seller of that domain name obviously the best way to realize the maximum value is to use a business broker or hold an auction and get offers from multiple interested parties you only need two interested parties bidding to find out where the maximum prices but as a buyer I mean it depends what the sellers motivations are if they’re making thousands of dollars per month and they have no interest in selling they’ll give you a weird number like a million dollars and not much you can do to discourage them from that they’re not just in selling and intereste and selling I think the key with this entire thing is to find people who are motivated sellers to find those people who are going into foreclosure so to speak and need money fast and you can come in there and swoop in and buy these websites for two cents per monthly unique but yeah it can be tough if you’re I probably like use a lawyer or a third party when trying to buy a website of that size or that that magnitude and now we serve you know how you have a third party acting on your behalf and also shows that you’re much more serious for a buyer making money through affiliate adsense how do you define a co-op twice monthly income yearly income by time Ziggs what’s your advice are generally you’re looking for about a year’s worth of revenue the really important things that would factor into the final price is the historical revenue if you’ve only been making a thousand dollars per month for one month that’s not worth a lot you know for one year per month for years and obviously it’s worth a lot more if you have a really long track record you can get into those higher multiples we’re getting eighteen months two years even three years worth of revenue for your website the traffic sources are really important as well if you have a lot of good you know links to your site some great organic rankings that’s important content original content is important and also the upkeep and maintenance of a website if you’re spending twenty hours a week on it then that can reduce your asking price but you’ve had a whole bunch of contractors are doing the work for five or ten dollars an hour then that’s a different story altogether hello I would like you to address the affiliate Nexus and the impact it may have on websites that are profitable and doing well have you seen that as different states in the u.s. have enacted legislation which has kicked out affiliates have you found an influx of viable us-based businesses that are suddenly at a fire sale price and if so how do people who are located in states like Delaware which has no tax how could we possibly capitalize on this it’s a very good question I’ve actually seen a couple of auctions in the last couple of weeks or people are selling really viable profitable businesses and they’re basically being forced to sell because they’re in California for example and their number one source of traffic we’re never more in terms of revenues cutting them off so definitely if you’re in a state like Delaware your huge advantage over Californians for example I think Amazon cut off a couple hundred thousand affiliates in Amazon Zappos and all these other programs are doing very similar things I think it’s very very disrupt this relative to the in this we don’t have a search functionality for affiliate Nexus tax as a reason for salad unfortunately but yeah I’d just be looking at you know high revenue websites try and filter for websites on making a thousand or two thousand dollars per month and just see what pops up there they’re not necessarily gonna be discounted over other businesses but obviously the pool of potential buyers is gonna be a bit smaller so perhaps you have less competition when you’re bidding on these types of businesses but yeah it’s definitely creates opportunity for the right types of buyers your question anything else one more yeah you gave some great tips for finding red flags and in terms of analytics data I guess another thing a lot of sellers might do is try to make their operating expense or a time commitment look a lot lower than it really is what are some red flags look for that yeah do you write the vast majority of people will underestimate the time and expenses involved in running their website they’ll disclose their hosting costs they’ll disclose those type of things but they won’t tell you that they’re spending 20 hours a week maintaining their website so you just have to really ask those tough questions and find out what’s involved in running the website if it’s a forum for example who’s doing the moderation if it’s a blog who is providing the content which another providing content what format is the content provided and do the bloggers have direct access to WordPress over there just sending you know Microsoft Word documents the website owner and then the website owner has to go in there and you know format it all out and then put it to create all the images etc so obviously you have to look at the type of website that you’re buying if it’s an e-commerce website is there inventory whereas the inventory ship stored who is shipping it who’s doing the customer support there’s an 800 number in the website who is answering those phone calls or the costs involved in that etc yes it’s tough I definitely have the seller sort of sign an agreement and those types of instances are contracts or disclosing everything and putting their signature on before you send them money one last question in the back and then we can break for lunch what happens if after doing all of that the bloke blatantly lies and you only find out after you have purchased the site what recourse do you have and have you got any examples of a case that happened I just send someone to jail for 16 weeks in the UK for fraud there was a court case it took like three years to get them into jail it was a very very long John out process but someone actually filed a criminal complaint against a seller for fraud and there were witnesses and we provided written testimony etc they pleaded guilty to three charges of fraud and they’re sitting in the jail somewhere in the UK right now definitely get a signed contract if you’re doing a large sale use a service like escrow calm to transfer the money one common scam is actually doing credit-card charge backs or doing PayPal disputes if you’re buying our website and paying via PayPal and there’s a dispute PayPal will always rule against you because it’s a digital Goodin’s no there’s no tracking or shipping number one way to get around that for example would be to ship a CD with a tracking number to the buyer and now you have some defense if PayPal comes after you at some point because the buyer disputes the charge and says they never bought it from you after the sale is completed so that’s another thing to watch out for but I anything over the five hundred or thousand dollars I’d be using a service like escrow com to transfer the money and get a written contract if they really big sail get them to even go to a local notary and have the contract notarized the scammers won’t go out of their way to commit fraud on that level in the vast majority of cases we’re all out of time but let’s break for lunch and if anyone has any further questions we can chat Thanks