Website Flipping QA

[AdrianB]

I have just heard about website flipping which is defined as the art of buying, improving and selling websites. The term comes from the property industry where investors will buy a property, renovate it to add value, and then sell it at a higher price. Website flipping is essentially the same process online. An investor, or investment group, buys an established website, adds value to it and then sells the site at a higher price (according to Website Flipping).
I would like to ask if someone has done this or has relevant/useful information about this online business?

 

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[Cruze]

You can ask your questions here public. It´s an interesting theme.

 

[AdrianB]

So far I could identify a few websites where you can buy websites or domains. 7 of the Best Marketplaces for Website Flipping
I think best option to start is flippa.com
Is it worth or not? I am going to give a try. I have a budget of 500 usd. My goal is to buy and sell for a 100 usd profit. Going to search for a domain or a website up to 500 usd and will see how it can be done.

 

[Aaron_S]

There is a lot of junk and scammers on Flippa so do your due dilligence. With a $500 budget you are going to see a lot of newer sites and first time sellers with flat out fake or "estimated" analytics and financials. That said the one time that I made a purchase through Flippa's marketplace it turned out fine. Look at the blog on FE International for an idea of what due dilligence entails for the specific business type that you are looking to purchase.

 

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[garyfritz]

I'd like to hear how you "improve" a website. I assume you bling it up a bit (fix any obvious design or navigation problems, pretty pictures, beef up the call to action, etc) and then you work to boost the site analytics (SEO, drive traffic with ads, increase the sales figures, that sort of thing). Same whether you're flipping it or developing it to hold as an income stream. Am I missing anything?

Of course each of those activities entails a whole list of skills that a newbie is unlikely to have. Some of them (like spiffing up the website) require web-coding skills or hiring someone to do it. Are there any good educational guides (like @Aaron_S's FE Intl pointer) that could give a newbie a step-by-step guide to the other parts? Or is this a "barrier to entry, go figure it out yourself" thing? Googling "flip websites" returns lots of possibilities, but does anyone have a particular recommendation?

The other question I have about buying websites is the longevity. The website has to continue to throw off income at a steady rate for a year or three just to earn back the purchase price, let alone the cost of ads, improvements, etc. How stable is web income? How often does Amazon or Google change the rules and destroy your income model? How hard is it to keep a steady/growing income stream in the face of constant and growing competition? These are things that you really need to understand in order to make an informed buying decision.

 

[garyfritz]

Looking on Flippa, I see some apps (mostly iOS) for sale. Free apps are making profit somehow (ads, in-app purchases, whatever) and might be a interesting alternative. I don't know iOS app dev but it would be interesting to learn, with a functional app/source/etc to start from.

Though you see these apps that the developer wrote, pushed out to the App Store for 6 months to build history, then throw out for sale. I gotta wonder if there was much long-term potential, why doesn't the developer hang onto the established income stream?

 

[SEBASTlAN]

I've done it a few times. The key is to buy on lesser known marketplaces and resell on Flippa etc

 

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[Aaron_S]

I'd like to hear how you "improve" a website. I assume you bling it up a bit (fix any obvious design or navigation problems, pretty pictures, beef up the call to action, etc) and then you work to boost the site analytics (SEO, drive traffic with ads, increase the sales figures, that sort of thing). Same whether you're flipping it or developing it to hold as an income stream. Am I missing anything?

You don't have to completely overhaul a site to make it more profitable. It can be something as simple as changing the location of one ad, selling a banner to a company for a monthly rate, adding some affiliate links that convert, etc. Adding $100 in net value is actually pretty easy. There may even be an operational expense that could be changed to save that much. I changed hosting on that Flippa project and saved about $100/month.

Of course each of those activities entails a whole list of skills that a newbie is unlikely to have. Some of them (like spiffing up the website) require web-coding skills or hiring someone to do it. Are there any good educational guides (like @Aaron_S's FE Intl pointer) that could give a newbie a step-by-step guide to the other parts? Or is this a "barrier to entry, go figure it out yourself" thing? Googling "flip websites" returns lots of possibilities, but does anyone have a particular recommendation?

There are case studies and tutorials out there but depending on what industry and business type you select the studies may or may not be applicable. Here is a good study on a niche resource site that is only a couple of years old. That site was already setup in Wordpress so the technical skills required were minimal.

The other question I have about buying websites is the longevity. The website has to continue to throw off income at a steady rate for a year or three just to earn back the purchase price, let alone the cost of ads, improvements, etc. How stable is web income? How often does Amazon or Google change the rules and destroy your income model? How hard is it to keep a steady/growing income stream in the face of constant and growing competition? These are things that you really need to understand in order to make an informed buying decision.

With a flip you don't neccessarily have to earn back the purchase price by running the site long term yourself. Just like a real estate flip doesn't need to turn into a long-term rental before it can be flipped. Web income can be pretty stable if the sources are diversified. The same as the previous sentence if Amazon or Google are the sole income and/or traffic sources that is risky.

 

[garyfritz]

With a flip you don't neccessarily have to earn back the purchase price by running the site long term yourself. Just like a real estate flip doesn't need to turn into a long-term rental before it can be flipped.

Good point. I was thinking of building and growing a long-term income stream more than flipping, so I was thinking of the longer-term cashflow. But yes, for flipping purposes, you just need to increase the value enough to get your desired return out of the flip.

 

[George Appiah]

I've done it a few times. The key is to buy on lesser known marketplaces and resell on Flippa etc

This is key.

In many cases, you can immediately turn around and flip it on a bigger marketplace like Flippa.

I once bought a website from SiteSell.com's private forums from an elderly owner who was just tired of maintaining the site, ported it to WordPress, and sold it on Flippa after less than a month for 2x my purchase price.

Granted, it wasn't a big ticket sale... but as a bonus, I also got to host and manage the site (for a fee) for nearly four years!

 

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