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transient

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Dec 5, 2019
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For early sites that were truly purchased with segregated funds and ownership recognized, I think those owners might have a chance at retention. But sites that were in fact purchased with pooled funds...that is pooled assets...became...pooled assets. Most likely they will remain pooled assets and sold for the benefit of the estate...where those pooled assets will be available for most site owners with worthless websites and distributed as part of any limited recovery.
The SEC documentation suggests that the funds may have ALWAYS been pooled. Look at how few frozen accounts there are. If the assets are segregated there should be hundreds of accounts. I suspect this was mismanaged from the beginning.

Oh boy, this will really screw those early adopters who said this was the greatest thing since sliced bread. Now imagine the SEC coming after you and asking for $56,000 you received over the last 3 years.
If that happens it is really going to be a boon to the people who would otherwise have lost a full 6 figures and have literally nothing to show for it other than a few $1500 payments. What happens though if one of those early investors had bad fortune and has no ability to repay? It just seems... wrong... to hold them accountable.

Also IF they decide to sell all the sites, who does the work? Those people will probably be relatively high rate individuals drawing from an already strained pool of money. There are loads and loads of websites and properly transferring those assets takes a lot of time for the seller and it takes LOADS of time for the buyer if done right. Also surely IS has sites that have no "owners". The process will probably take more than a year and during that time hosting and domain registration costs will need to be paid. Every site without ops staff will quickly become worthless. For a large percentage of sites I'd bet the most prudent action would be to cancel hosting and put the domains to auction. Any other action would likely cost more in paid skills, hosting, etc than they make.

It's all very interesting and challenging. I really don't envy whoever has to sort this out.
 

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MakMac

New Contributor
Jun 19, 2019
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For a large percentage of sites I'd bet the most prudent action would be to cancel hosting and put the domains to auction. Any other action would likely cost more in paid skills, hosting, etc than they make.

It's all very interesting and challenging. I really don't envy whoever has to sort this out.
Agreed...most sites are losers. The best thing for losers...is stop the bleeding. Pull the plug as you suggest.

WE have heard that there are a few winners. Which might well be a complete lie. If so, pull the plug. But if some site is generating a $100,000 a month. That site might fetch $2,000,000 to $2,500,000 at market. AS you suggest, sell it quickly before lack of attentions further wastes value.

General rule...spend a little time evaluating...and then quickly realize best value on winners...and pull the plug on losers. No reason that shouldn't be done rather quickly other than the need for the court to sign off..but what is judge going to do....hold a hearing...and sign off.

Then you divide the marshaled assets among wrongful winners (full claw back), rightful winners (limited recovery), partial losers (base recovery) and total losers (enhanced recovery). It's not the first Ponzi...probably wont be the last. Terrible process for investors. But once everyone RETURNS to business on FULLY RATIONAL basis...the ONLY way home is not so unclear or complicated.
 

MJ DeMarco

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Link to official SEC announcement that yes in fact, it was a Ponzi scheme.

 

MohitT

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Oct 5, 2013
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I have been helping people invest in websites for almost 8 years now. And the Income Store fiasco will definitely hurt the whole industry in general. It's not easy to sell people on money-making websites, and with this, people are gonna be more skeptical. That's the reason I only prefer to work with people who know about this asset class and are comfortable with the risks involved. To others, I just say no.

In short, here is how we go about it:
  • We require a minimum investment of $50k from investors and once we have a commitment, my team and I go out scouring suitable deals for them. We do have our in house deal flow as well as I have made friends with a lot of people who actively buy and sell sites.
  • We do not give any income guarantee. But what I have seen is that we are able to give a 20-25% annual ROI to our investors, and that's after our management fee.
  • You as the investor, own the asset and we are just a management company.
  • We have an in house team of 10 full-time people, ranging from editors, writers, SEOs, tech people and general managers. We solely do content sites. No SaaS, no e-com.
  • What I have typically seen over the last 7-8 years is that the investors who have invested with us, end up buying more and more sites and building up their portfolio as they get more comfortable with the business model. I think no one (except maybe 1 or 2) has just one site in their portfolio.
If anyone has any questions, feel free to DM me or reply here. Happy to help
:smile:
 

UnrealCreative

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What I'm curious to see over the next few weeks is how the current assets will be distributed. Is there a legitimate chance of a firesale and we should line up to acquire Income Store's underperforming assets with some potential? Quote from here:

"The Receiver is presently operating TGC’s business with a minimal staff of IT personnel to preserve the websites and other digital assets. The Receiver will propose a hybrid claims process that permits investors to make a claim for the domain(s)/website(s) “assigned” to them in the Consulting Performance Agreement in exchange for releasing any claim against the Receivership Estate under certain parameters and those investors who do not want their site could participate in a later distribution process from a pool of liquidated assets and recovered funds. The Receiver will make such proposal by separate motion on or before February 28, 2020. This expedited process will permit the Receiver to transfer and/or liquidate the remaining domains/websites in the next 90 to 120 days, preserving the Receivership assets required to maintain the domains and websites."

...And a full list of ALL their domains and active websites (Over 3000 in this case!):
 

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