Does anyone here buy websites on Flippa as a passive investment option?

[MyronGainz]

Hey Guys,

I came across Flippa the other day and thought it was quite interesting. Some of the deals on their seem too good to be true (maybe they are), but I mean a website selling for $4-10k that generates $1-2K/mo in profit... jeez that's a pretty decent return.

I'm looking for a completely passive or at least a semi passive investment option somewhere between the $20-$50k range, willing to speculate. (I'm quite experienced with AdWords Search PPC and SEO, and have a secretary that can manage it, so no need to consider that a time-consuming task).

-How accurate are the financials?
-If you bought an ecommerce store, how does the inventory/shipping/distributing/warehousing work?
-How passive are these "investments"?
-Have you been burned on their before?
-Is there some sort of guide or ebook or article on this that you'd recommend?

Any help or advice is greatly appreciated, thanks in advance guys

Myron

 

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[Y.B.]

$4-10k that generates $1-2K/mo in profit

Would you actually believe these numbers?

I'd say 98% of listings on flippa are crap. Lot's of scams there as well. You can def find some good deals/sites but expect to pay 12-24X monthly revenue if not more depending on the site. Passive income sites tend to sell for more.

 

[MyronGainz]

Would you actually believe these numbers?

I'd say 98% of listings on flippa are crap. Lot's of scams there as well. You can def find some good deals/sites but expect to pay 12-24X monthly revenue if not more depending on the site. Passive income sites tend to sell for more.

Thanks for your repsponse,

I am really intrigued to be honest, and willing to give it a shot and buy a site. Have you ever bought site there before? How did it pan out?

 

[Y.B.]

I am really intrigued to be honest, and willing to give it a shot and buy a site. Have you ever bought site there before? How did it pan out?

I've mostly sold on there. It really depends on your goals and budget. You can message me if you have other questions. But if a site is making $1k profit per month, expect to pay $12k on the low end.

Also one thing to keep in mind when buying a "passive business." It's only going to be passive for so long before it dies because competitors will always be working on their business while you let theirs site...so it's only a matter of time before the passive business goes down the drain if you're not consistently working on it.

 

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[cikatomo]

It depends on many factors.
Is the revenue and traffic in the growing or declining stage? Why?
Whats the source of traffic? Is it paid or organic or referral? If it's paid how much is the % of revenue?
What's the source of revenue? Adsense, affiliate, owned product, membership?

Sometimes good websites get sold for more tan 24x revenue if they are good. Like the recent glitter website. Sometimes it's not worth it to buy even if it's 4x.

Just one note. Beware of the spikes and fast increases. Look for slow and steady.

 

[MyronGainz]

Thanks for your responses guys.

How does buying an ecommerce site work? Do they just tell their suppliers to ship to the new buyer after sale is complete? And then you are responsible for warehousing, order fulfilment, shipping/distribution?

 

[ddzc]

It's tough to paint everyone with one label....I'm sure some are legit but MANY are not. It's so easy to fabricate and photochop numbers, revenue, traffic stats, etc. I wouldn't touch anything where 100% of their traffic sources come from organic searches like google...all it takes is one update and ban, your business is gone and you just lost a ton of cash. If you see a well branded business with traffic flows from multiple sources, mostly word of mouth and from great reference points, those are winners. A lot these guys whip up a site, do a bunch of blackhatseo, earn revenue for a few mths and try to flip the site on flippa, stay away, FAR away!

 

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[MyronGainz]

It's tough to paint everyone with one label....I'm sure some are legit but MANY are not. It's so easy to fabricate and photochop numbers, revenue, traffic stats, etc. I wouldn't touch anything where 100% of their traffic sources come from organic searches like google...all it takes is one update and ban, your business is gone and you just lots a ton of cash. If you see a well branded business with traffic flows from multiple sources, mostly word of mouth and from great reference points, those are winners. A lot these guys whip up a site, do a bunch of blackhatseo, earn revenue for a few mths and try to flip the site on flippa, stay away, FAR away!

That's good to note, thanks for that. So I guess "Direct" is probably the most valuable/stable traffic source?

 

[ddzc]

That's good to note, thanks for that. So I guess "Direct" is probably the most valuable/stable traffic source?

If all traffic is direct, I would still question that. I have a bunch of domains which I've never used in my life and it gets 100s of garbage "direct" hits per day, from god knows where. I would question the marketing, how are the sales being driven to the business. Based on the sellers response, you should gauge the sincerity of the info he's providing. If he's got a solid marketing plan surrounding the brand, then you know he's doing it right. I would need an example to look at and then we can pick at it in depth.

 

[cikatomo]

That's good to note, thanks for that. So I guess "Direct" is probably the most valuable/stable traffic source?

It really depends. Why is it direct? Is it because people type the URL which is good, or is it because they copy paste from some youtube comments which is not good. If you find something give me a link and I can tell you what's good and what's not on particular case, or post it here so we can all discuss

 

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[sector7]

I wrote a short article about this several months ago. Perhaps you'll find it useful:

Flippa is the number one marketplace for buying and selling websites in the world with over half a million users. This means that there’s lots of websites for sale to choose from! But it also means there are many individuals trying to rip others off! Crooks are everywhere so it’s important to keep your eyes wide open all the time. In order to avoid problems and help you make the right choices, I have come up with a list of suggestions when buying websites on Flippa. Feel free to ask me about a specific website and I will give you my opinion on it. Without further ado, here’s the list:

• If the deal seems too good to be true, walk away. When somebody claims they make $10 000 monthly profit but they’re selling the website for $5000, there’s something really fishy going on. They are either lying, you’re missing something obvious or their website income source is temporary and will disappear in the near future. Save yourself the trouble and move on to another website.
• No profit? Don’t buy! If the site isn’t making a profit, don’t buy it. Just because the seller says the website has the “potential” of making X amount of dollars a month doesn’t mean it’s true! Don’t believe a single word he says! He could be trying to trick you. Look at the facts. Ask for the facts. Don’t be afraid to ask the seller tons of questions and ask him to show evidence on his claims. NEVER BELIEVE THE SELLER WITHOUT PROOF and stay away from “potential” profits! Sure, you could turn the site around and start making profit, but the chances are slim, especially if you’re a beginner.
• Avoid sketchy sellers. If the seller is new to Flippa and has a very disorganized auction, stay away from him. Also, when a seller is deleting a lot of the asked questions or is simply not responding to them this is a clear sign that you should hit the back button on your browser. Try to look for sellers with past transactions on Flippa and who are very responsive to people’s questions and concerns. Transparency is very important. If you’re getting the impression that the seller is trying to hide something, he probably is. Pick your sellers very carefully.
• Only “trust” verified data. The more data, the better. A good seller should provide as much evidence as possible. This will include long term revenue proof, traffic, keywords and other forms of supporting data. Use SEMrush.com to check if the seller is lying about his Google rankings. SEMrush will show you the top 10 keywords a site is ranking for and some traffic approximations. Also, request for access to their Google Analytics so that you can verify the data provided is accurate. Don’t hesitate to ask the seller questions! You want to know everything there is to know about the website you’re buying. You can even request video proof since videos are significantly more difficult to fake compared to screen shots, or better yet, set up a remote connection between you and the seller using Teamviewer.
• Transition and technical support after the sale. Is the seller willing to assist you after the sale is finalized? A good seller will offer weeks or even months of technical support to ensure that you are happy with your purchase and that everything is working well. Ask in advance how the site will be transferred to your hosting account so you know what to expect.

If you carefully follow this advice, your Flippa experience will be a positive one. Good luck.

 

[MyronGainz]

I wrote a short article about this several months ago. Perhaps you'll find it useful:

Flippa is the number one marketplace for buying and selling websites in the world with over half a million users. This means that there’s lots of websites for sale to choose from! But it also means there are many individuals trying to rip others off! Crooks are everywhere so it’s important to keep your eyes wide open all the time. In order to avoid problems and help you make the right choices, I have come up with a list of suggestions when buying websites on Flippa. Feel free to ask me about a specific website and I will give you my opinion on it. Without further ado, here’s the list:

• If the deal seems too good to be true, walk away. When somebody claims they make $10 000 monthly profit but they’re selling the website for $5000, there’s something really fishing going on. They are either lying, you’re missing something obvious or their website income source is temporary and will disappear in the near future. Save yourself the trouble and move on to another website.
• No profit? Don’t buy! If the site isn’t making a profit, don’t buy it. Just because the seller says the website has the “potential” of making X amount of dollars a month doesn’t mean it’s true! Don’t believe a single word he says! He could be trying to trick you. Look at the facts. Ask for the facts. Don’t be afraid to ask the seller tons of questions and ask him to show evidence on his claims. NEVER BELIEVE THE SELLER WITHOUT PROOF and stay away from “potential” profits! Sure, you could turn the site around and start making profit, but the chances are slim, especially if you’re a beginner.
• Avoid sketchy sellers. If the seller is new to Flippa and has a very disorganized auction, stay away from him. Also, when a seller is deleting a lot of the asked questions or is simply not responding to them this is a clear sign that you should hit the back button on your browser. Try to look for sellers with past transactions on Flippa and who are very responsive to people’s questions and concerns. Transparency is very important. If you’re getting the impression that the seller is trying to hide something, he probably is. Pick your sellers very carefully.
• Only “trust” verified data. The more data, the better. A good seller should provide as much evidence as possible. This will include long term revenue proof, traffic, keywords and other forms of supporting data. Use SEMrush.com to check if the seller is lying about his Google rankings. SEMrush will show you the top 10 keywords a site is ranking for and some traffic approximations. Also, request for access to their Google Analytics so that you can verify the data provided is accurate. Don’t hesitate to ask the seller questions! You want to know everything there is to know about the website you’re buying. You can even request video proof since videos are significantly more difficult to fake compared to screen shots, or better yet, set up a remote connection between you and the seller using Teamviewer.
• Transition and technical support after the sale. Is the seller willing to assist you after the sale is finalized? A good seller will offer weeks or even months of technical support to ensure that you are happy with your purchase and that everything is working well. Ask in advance how the site will be transferred to your hosting account so you know what to expect.

If you carefully follow this advice, your Flippa experience will be a positive one. Good luck.

Thanks for this, great insight. I will definitely keep all of this in mind.

 

[InstantNoodles]

After college, I had some money saved up and invested about $25,000 into flippa sites.

It was a disaster. I am well versed in the web (not sure if you are) and even I was not able to keep up with all the Google updates.

One site I spent over $10k on was delisted from Google the day I transferred it to my server.

There are certainly sites out there that are passive income. But the thing is, why would an owner part with it for 6x monthly earnings, when a bond pays 5%?

 

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[amp0193]

I bought 3 sites on Flippa 2 years ago. I was intrigued by Snowbank's INSIDERS call about eCommerce sites.

1. One site sold a few skus of niche hoodies and t-shirts. I paid $300+several hundred in inventory. Really good product, customers loved it, and I probably profited $1300 over the next year. Warmest, most comfy hoodie I have ever worn. (If anyone here wants the company that made them for me, PM me). I did not maintain the site, as I realized that the products were technically trademarked, and that I could be shut down at any time, and so like someone said above, sales slowly tapered off until I eventually sold out of the first run I had made. "Passive" will only last you so long.
2. One site was a snowplow subscription site I bought for $1000 that came with lists of their previous customers and sub-contractors. I profited $1000 that winter with very minimal work. BUT, I also found out from one of the plow guys that the previous owner was sued and taken to court for not paying any of the drivers, so the drivers stopped plowing for the customers, which is why lots of the drivers and customers from the list were gone by the time I bought the site. Again, I didn't maintain the site, and then I sold it for like $100 last September.
3. One site was a middle-man web-development site with "lots of traffic" via an "easy free-marketing strategy" making $xxxx amount. Site included said marketing strategy and the out-sourced developers that had been used. I paid $5,000. I then discovered that there was no traffic. I worked the "free-marketing strategy"... some Linked-In course from the Warrior forum, which maybe someone has used before to get traffic, but I certainly wasn't able to. I attempted to re-sell the site on Flippa a couple of months later, but the listing was banned because of infringing on another listing. Turns out, the guy who sold it to me, was selling a carbon copy website, with a different URL, and blue background instead of red. tl;dr I eventually sold it for like $700, and some random guy bought the linked-in course from me for $120 (lol).

Assume everything on Flippa is a scam, unless it's really obvious that it's not. Like a mom&pop owned online specialized antique eccommerce store that's been operating for 8 years and is listed for $75k. That's probably going to be real. If you're looking in the $25k-50k range, you are likely to see a few more legit sites, or at least ones that have seemed more legit to me. But maybe they are just more professional swindlers. I would trust nothing listed for under $10k on Flippa. And I would trust NONE of the data/figures claimed on any listing.

Also, check out the stickied posts on the "due diligence" section of this forum... these guys are the authority on trading websites.

 

[amp0193]

After college, I had some money saved up and invested about $25,000 into flippa sites.

My heart sank when I read that sentence. Sorry man.

But hey, you've got to fail hard before you can succeed.

 

[redsfaithful]

I'd recommend checking out http://empireflippers.com/

They do a lot of writing about buying/selling websites. They also have a marketplace of sites they vet, I believe the the standard rate they sell sites is 20x monthly. Which is still a steal in a lot of cases.

There's a few brokers that do deals in the $100k-$1mil range. I personally think there will come a time when people will look back and be amazed you could buy a quality internet business for less than 2 years earnings. Volatility is part of why things are cheap of course, but it's a buyers market.

I'm sure there's good deals on Flippa, but the amount of time you have to invest to sift through the scams is enormous.

 

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[Y.B.]

I'd recommend checking out http://empireflippers.com/

No one wants to pay a deposit just to find out more information about a website...too much hassle upfront during initial stage

 

[redsfaithful]

No one wants to pay a deposit just to find out more information about a website...too much hassle upfront during initial stage

They sell quite a few sites, so I'm afraid you're not correct with regards to "no one." Clearly some don't mind.

This is another problem with Flippa, from the selling side. Far too many tire kickers, "buyers" who mostly just want to steal the business model, see where the traffic is coming from, time wasters, etc.

 

[empireflippers]

They sell quite a few sites, so I'm afraid you're not correct with regards to "no one." Clearly some don't mind.

This is another problem with Flippa, from the selling side. Far too many tire kickers, "buyers" who mostly just want to steal the business model, see where the traffic is coming from, time wasters, etc.

Yeah, that's exactly why we charge a deposit. Ultimately, it's to protect our buyers from the dozens of copycats that tend to pop up from the (few) Flippa listings that are actually worth anything.

Limiting the site's exposure to those copycats protects the buyer and buys him/her time to continue building the site out further.

That's not to say we don't lose out on some legitimate buyers that are philosophically opposed to paying a (refundable) deposit to see sites. (We do) It's just that it for everyone one of those potentially real buyers we save ourselves from having to deal with dozens of tire kickers.

 

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[Drchainsaw]

Hey Guys,

I came across Flippa the other day and thought it was quite interesting. Some of the deals on their seem too good to be true (maybe they are), but I mean a website selling for $4-10k that generates $1-2K/mo in profit... jeez that's a pretty decent return.

I'm looking for a completely passive or at least a semi passive investment option somewhere between the $20-$50k range, willing to speculate. (I'm quite experienced with AdWords Search PPC and SEO, and have a secretary that can manage it, so no need to consider that a time-consuming task).

-How accurate are the financials?
-If you bought an ecommerce store, how does the inventory/shipping/distributing/warehousing work?
-How passive are these "investments"?
-Have you been burned on their before?
-Is there some sort of guide or ebook or article on this that you'd recommend?

Any help or advice is greatly appreciated, thanks in advance guys

Myron

From what I hear around, people take the listing on flippa and massively research everything about the site. I wouldn't imagine the business staying healthy after it being price gauged.

 

[Andreas Thiel]

Wrote about my experience with Flippa / Escrow: QUESTION - Escrow / Flippa - EU to US - what am I missing?

I would say I can tell you more soon about a business for <10k with around 2k in monthly profits (with an affiliate program) that would have to transition from early launch mode - with lifetime access for early adopters - into a subscription model).

... but after almost 2 months I am not sure payment issues will ever be resolved.
TrustPilot ratings: Flippa is rated "Average" with 3.5 / 5 on Trustpilot
Might be that the experience is extremely different for Europeans.