Today we’re handing the blog over to Jerry Banfield. Jerry is an entrepreneur and teacher who has coached over 80,000 students on everything from Facebook marketing through to time management and productivity.
Last year Jerry built and sold a profitable site on Flippa for $5,500 with no experience and the best part is, he’s put together a step-by-step Udemy Course to share the details on exactly how he did it. Usually $199 – for a limited time, Jerry has dropped the price down to just $25 for all Flippa users. Simply use coupon code: FLIPPABLOG or THIS LINK.
Over to Jerry:
If you are trying to sell your website on Flippa, knowing what works to make a sale can save you a lot of frustration and money. The first two times I posted websites for sale on Flippa, I made my listings and then tried to promote them in complete ignorance of what other sellers were already doing right. No one bid on any of my listings…
When I went to relist my website again, I realized it was crazy to do the same thing I did before and expect different results. For the next few weeks prior to launching another listing, I researched the Flippa marketplace to see what websites were already selling so that I could discover what they all had in common. I found websites that had sold for at least a thousand dollars almost always showed solid proof of income and had verified Google analytics. I also discovered what price to start the bidding at, how to write a compelling listing to attract watchers, how to directly contact potential buyers, how to convert people watching to bids, why every question was worth answering in great detail, and what I needed to do to make it easy to close the auction successfully.
When I used what I learned to launch a new listing on Flippa, the same website that did not attract even one bid when I listed it before sold for $5,500.
You can skip the painful learning process I went through to learn how to sell on Flippa when you take this course. You can see what your website is really worth when you list it the way I listed mine. This course will continue to be useful for you through any improvements Flippa makes because what I teach is based on principles that you can adapt to what you are doing today. You can count on me to answer any questions you have in the course and to add new lectures based on your feedback! Thank you for reading this and I appreciate the chance to serve you as your instructor in this course.
Today we sit down with Alec Larson, a successful Flippa seller who has perfected a strategy for selling websites with no traffic or revenue. Alec gives us the scoop on what it takes to sell a startup valued primarily on potential, and how you can do the same thing.
Tell us about your background as a web entrepreneur
In the winter of 2010 my partner and I saw a need in the real estate market for aerial photographs. Over the next few months I was able to learn how to engineer, build, test and operate an 8-foot aerial helicopter drone that was able to successfully carry a DSLR camera, taking dozens of aerial pictures for local real estate agents. After the success of the drone project, I realized the need for a centralized source of qualified drone operators. Turning my efforts online, I built Aerial Connect, the first ever online drone-pilot directory.
What brought you to Flippa?
Just as Arial Connect got its legs off the ground, I hit a burnout. I was a single founder working on the site by myself, and I realized that it just wasn’t feasible without a team. Having made an account on Flippa a few months earlier, I was really curious to see how much I could get for Aerial Connect. I’d put a lot of hours into building the platform and designing the site, but it had almost no traffic and no revenue. Nonetheless, I decided to list it on Flippa, and the result exceeded my expectations. It ended with 11 bidders, 69 total bids, and sold for $2,050 after a two-week auction.
Now that you have sold AerialConnect.com, what’s next for you?
After the AerialConnect auction, I was inspired and decided to see if I could replicate what I’d just done with another listing. Since then I’ve had 6 more successful Flippa listings, below are examples of three of these:
Night-Clubs.com: I bought the domain on Flippa for $47! Within one week I built a really great night club directory on it. Within two weeks I sold it for $1,000 – a very big win. After the site sold, I even had one user contact me via PM and offer $2,500 for it.
GetFlightTraining.com: I created this flight school directory and sold it a month later for $500 and interestingly enough I was contacted through that listing by an entrepreneur who wanted to build a veterinarian directory. He said he loved my design work and asked if I could build his idea. I did.
DroneTrades.com: As a used drone marketplace, DroneTrades was special because I established it in April 2015 and did a little marketing. I was able to get 5 users on board and even established a partnership with a reputable drone dealer. Eventually I listed it on Flippa and it sold for $1550.
I’ve had a few people notice my listings and ask me how they can start doing something similar. Having people reach out and inquire about my success on Flippa made me realize that the experience and knowledge I’ve gained could be valuable to others. So I’ve put together an in-depth Flippa training course. The course covers everything from the initial domain setup, to the entire development phase, to the Flippa sale.
How has your business philosophy contributed to your success?
It seems like more and more the idea of building a startup and cashing in big has become a bit of a trend lately, especially with millennials. I read a great quote that I’ve essentially lived by over the last few months:
“In a gold rush don’t dig for gold, sell the shovels”
While I’m not saying creating the next Instagram or Google is impossible, I’ve found that as a one-man operation, selling web development services, themes, plugins, design services, email services, and marketing services has a much higher success rate and can be just as rewarding. I’m thankful that I found Flippa because it has given me the opportunity to “sell the shovels.”
Any advice for web entrepreneurs looking sell websites on Flippa?
From my experience, there are a few main elements that make a successful Flippa listing. The following advice is geared towards selling a website very little traffic or revenue, if any, but I would imagine most of the concepts hold true even if you’re selling an established website.
1. A good idea in a trending industry: If you want to successfully sell a new startup on Flippa, focus on creating a great idea. When I initially came up with the idea of Aerial Connect, I knew that if I didn’t build a drone pilot directory someone else would, it was only a matter of time. Drones are trending, the whole industry is growing at staggering rates and the technology is solving problems and providing tremendous value. I think this concept boils down to three main elements
Have a great idea
Target trending industries
Build products that work and solve real problems
2. The Pitch: Whenever I sell something on Flippa I spend a lot of time lot of time writing the listing description. It’s incredibly important to be transparent. If you’re doing something dodgy or trying to hide something material to the sale, someone will find out, and your reputation will be tarnished. That said, YOU SHOULD be passionate about what you’re selling. My passion for drones helped me go from just a basic developer selling a WordPress site to a guy who had a fundamental understanding of the drone industry and had built a really great startup for drone pilots.
3. No Reserve: Setting your Flippa auction to No Reserve is important for two reasons.
It will sit in the reserve-met section on Flippa. At the time of this writing there are currently only 55 websites listed for sale in the reserve-met section and each one will get significant exposure. Getting onto this list greatly increases the number of views, watchers, and bids your listing will generate.
It allows users to determine the actual value of your site. Having a reserve price or a buy it now price might filter out would be bidders. More bidders = higher activity on your listing. Higher activity on your listing = more views because it will be displayed in Flippa’s most active listings section.
So, that’s Alec’s story, and a glimpse into how he sells websites on Flippa with no traffic or revenue! What do you think? Drop in a comment below to let us know.
As the Websites Product Manager for Flippa, my job is to work on constantly growing the marketplace to better fit what Buyers want. That’s why I’m perfectly placed to give you these exclusive insights how to get the best sales price for your listing:
Google Analytics is king
All serious Buyers demand Google Analytics verification before they will seriously commit to bidding in an auction. You should know we’re now applying priority in search results to listings with verified traffic. This means auctions with verified traffic receive on average, four times the views that unverified listings do. That’s the best free upgrade you can give yourself, right there.Pro Tip! It’s important to note that you need to do this via the Flippa verification tool (it’s worked when your traffic graph shows in green). If you’re having trouble adding it to your auction, we can do it for you by allowing us read-only access to your GA (more info here). If you’re not using Google Analytics, you’re really doing yourself a disservice in terms of getting the best sales price. Do yourself a favour and add it now.
If you haven’t got revenue proof, it essentially doesn’t exist to Buyers
The savvy Buyers (those are the ones prepared to pay top dollar for high performing sites) run through this quick checklist before even taking a second look at a listing:- Does it have Google Analytics
– Does it have revenue proof
– If yes to both above, proceed to next step.This means if you’ve claimed revenue but haven’t uploaded proof of it, you’re missing out on a big slice of the Buyer pie.It is not acceptable to provide just screenshots from Paypal for your listing. The recommended method to verifying revenue is by placing a video walk-through – more info how to do this here. Pro Tip! Google AdSense can be verified on site with Flippa and this gives you a similar boost in views, as verified revenue listings are given priority in search results above those without.
Price to sell
Our research suggests the single biggest factor on whether a listing will sell or not is the start and reserve price being appropriate and realistic.
Here’s our expert lowdown on how to give yourself the best chance of sale:– Start price – always start at $1, or at an entry level price point (under $200). Getting those first bids on the clock is important to reflect activity and confidence in your listing.. The higher the start price is (ie. $80K for a $90K reserve price listing) the less likely you are to sell, as it’s simply too high for people to get involved.– Reserve price: Buyers actively look for properties which are “reserve met” (aka. ‘on the market), as they feel they can actually buy the site, rather than just bidding on something only to find out it was way out of the price range. Therefore, getting your listing in the “reserve met” area is one of the best upgrades your listing can get. We see sites that meet their reserve earlier, sell for much higher multiples than listings who play it safe.If you’re unsure what reserve price to add, contact our websites team and we can help you choose the best fit [email protected]
Read our case study here from Austin – Why I set a no reserve price auction –>– Buy It Now Price: We do not recommend adding a Buy It Now price on your listing until the final phases. Why? Buyers are often shopping on a budget and believe the BIN price to be a realistic pricing given by the Seller. Meanwhile, Sellers are typically making BIN prices two or three times their reserve in the off-chance that someone might be inspired to grab it. Trust us – it almost never happens and by adding the BIN price too early, you’re alienating a huge proportion of Buyers who might otherwise have looked into your listing more. More here on strategically applying a BIN price and increase your final sales price by 10% or more –>
We’ll be in touch if anything is missing Buyers have told us they want Flippa to vet the websites marketplace more. In fact, they told us it was the single biggest thing we could do make them buy more sites. That sounds great! So, in all of our best interests, we’ve kicked that off. Don’t be surprised if we reach out to you to discuss your listing and request more information to be added. Ultimately, we aim to pre-empt Buyer questions so that the hard work is done for them and they can confidently bid on your listing.
Add a promo banner Are you looking for a way to bring even more attention to your website auction on Flippa? Your regular visitors are the perfect buyers, because they already love your site. Now you can let them know your site is for sale by adding Flippa’s new promotion banner to your website. More here about how to apply a promo banner to your auction –>
We hope these tips help you reach the best sale price for your website. Share your own tips and tricks in the comments!
Here at Flippa we’re constantly chatting with you, our customers, and one question that has been coming up recently is, what info should I include on my App listing?
Apps are an emerging market and there’s a lot of potential for buyers if they know what to look for.
While there’s no doubt that the more details you include the better, there’s one thing above all that our buyers want to see and that’s verified performance and revenue data.
There are a number of tools out there which will help you track your Apps performance, to get started here are a few of the more commonly used and a bit about them;
Flurry, free at any scale and widely used internationally
App Annie, free and subscription model with a wide range of analytic options available
Google Analytics for Mobile, free and includes Google Play Integration which will show you what brought users to your Android app
iOS App Analytics, free and requires zero technical integration on iOS apps. New features include daily app crash data
Once you have your performance analytics in place, the information that will be of most interest to buyers include;
Usage and downloads; monthly download data and app ranking
Revenue; including app sales and in-app purchases where applicable
Retention; how often users are coming back to your app
Locality of users; most tools will be able to break out data use by country so buyers can see where your app is most popular
App health if available i.e daily crashes
By including this data it shows buyer’s exactly what kind of opportunity they’re purchasing and saves time for both buyer and seller by including it upfront.
We’ll be working on getting verified app analytics included in the sell process, but to get this information in front of potential buyers right now there are two options we recommend;
Do a video walkthrough for your prospective buyers and either upload as an attachment or show them the details in real time. We’ve got more information on how to do this in our support page here
Include PDFs/screenshots or other documentation from your analytics tool and upload these as attachments to the listing. You can attach screenshots once your listing has launched from within the listing detail page
If you are sitting on an app and thinking of selling you’re in the right place, Flippa has more apps for sale and interested buyers than anywhere else, and even better they’re free to list!
If you are thinking about purchasing an App, ask the seller to take you for a video walkthrough or upload documentation from their analytics tool so you have the numbers to purchase with confidence.
Another tip; whether you are buying or selling we recommend jumping on a quick skype call with any interested parties, it’s important to find someone you’re happy to work with during the course of the sale and after!
Today we sit down with Adam Persak and Michał Zubkowicz, two successful online entrepreneurs who purchased the SaaS site Muscula.com at auction on Flippa for $25,100! Adam and Michal give us the inside scoop on Muscula, what they’ll do with it moving forward, and their tips for other online entrepreneurs on Flippa.
Tell us about your background as web entrepreneurs
Our company, Universe Surf GmbH, has been present on the German market for over 15 years. We specialize in automating software development processes, as well as providing cloud services. Our team consists of people experienced in both corporate and small business. Though we mainly focus on internal projects relating to our existing sites, we occasionally make acquisitions as well.
How did you guys discover Flippa?
We were users of Muscula.com ourselves, and we discovered it was for sale through a banner on the site, which of course led us to Flippa. It was our very first website auction. Overall, we had a good experience with Flippa, and we’re certainly encouraged at the potential of enriching our website portfolio further through the platform.
Tell us about Muscula.com, what is the site about and why did you ultimately decide to place a bid?
What have you done with Muscula since you purchased it, and what are your plans for the site moving forward?
After we won the auction our Creative Director (Arthur Niźnikiewicz) began rebranding and improving the visual aspects of the site. Fast forward a few weeks later, and we now have a new logo and website design. The next step will be an intense marketing campaign. From a product standpoint, we are focused on implementing error prediction, which means that in addition to identifying and solving a client’s existing errors, we will also be able to help alert them to potential future errors. We think this this will be a significant advancement that will drive a lot of new interest.
Any advice or recommendations for other online entrepreneurs looking buy websites on Flippa?
Find sites you are passionate about. For example, before we discovered Muscula was for sale, we were using Muscula on a bunch of our own sites. This made the purchase easier because we were already intimately involved with the service and fundamentally understood the problem it solved. Of course, this is not to say that you should be a longtime user of any site you buy, but rather, if you are looking at buying a site (especially a SaaS site) you should understand how it works and you should make sure you believe in the service it offers.
Have you ever tried selling an online business before? If you have, you know that selling a web business is very different from selling a widget through Craigslist or eBay. It’s not something you can just ‘have a go’ at without potentially exposing yourself to legal problems. Your web business is the whole package of the website and all the systems, procedures, staff and office space behind it that make the whole thing profitable and of interest to a prospective buyer, rather than just the website.
In short, agreeing to sell an online business is no small thing and needs to be carefully considered.
1. Do you really want to sell?
That might sound like a silly comment but many people experience ‘seller’s remorse’ after the point of no return. Once a contract is made, it is very difficult to back out without BAD THINGS happening. ‘Bad Things’ include having to pay money to the proposed purchaser and even a legally enforceable requirement to hand over the business.
2. What are you selling?
Do you really understand all the components that make your web business profitable, how they work and more importantly, how to hand over control to the new owner? Are you clear about whether or not it is the business entity, or just the assets that you are selling?
You might have an established web business in a corporate entity and expect the buyer to take the company off your hands as part of the business purchase. This will involve share transfers and may include unexpected complications where the buyer and seller are in different countries. Most countries have specific rules around foreign ownership of companies; like the requirement to have one local director. What will you do if all the buyer wants is the assets?
Worked Example – website for sale [beastbox.com.au]
“We will transfer ownership (shares) and directorship of the company into your name and complete any transfer of ownership necessary such as web registrar. Stock will be couriered to an address of your choosing. Training and guidance negotiable.”
A completely different set of problems arise if you have setup the web business over time and inadvertently had different entities owning or controlling different aspects of the business. For example, you might have purchased images for the website in your own name, software in a company name and then had content for the website contracted through the business. If you are selling an online business that looks like this then you need to know that you are legally able to transfer everything you say you are selling as part of the transaction.
Don’t try and be too helpful as a seller just because your prospective purchaser is overseas. I saw a seller on Flippa make the following comments:
“You need an ABN (Australian Business Number) but you can use mine if you can’t get one” and then “You won’t be able to own the domain, but I am happy to leave it in my name (I have done this before with another site) and simply transfer the domain into your registrar.”
High Risk! If you keep the domain name and business number in your name, but let someone else use it for revenue, you could be found personally liable for tax on income. Don’t just assume you won’t be caught or that your explanation (I sold the site) will be accepted when all other evidence points to the contrary.
3. Preparation for selling an online business
When you are selling the components of the business rather than the entity, have a clear list of all the content and intellectual property to be transferred, the software licences, the agreements with suppliers, advertisers and affiliates, the registration and hosting and any social media accounts. Make sure there are not going to be any issues with transferring anything across to the buyer.
When it comes to business names and trademarks understand or outsource the transfer processes. Where you are transferring copyright, you need to be able to demonstrate that you have the right to transfer (eg. receipts from a stock photo site) and include a paragraph in your contract of sale identifying and transferring all necessary copyright.
Think about the sales process behind your website business. How easy is it going to complete the change-over to the new owner and will they need any new accounts? Be clear on how you are going to transfer any post-sale sales income to the buyer if the systems transfer doesn’t go as cleanly as you hope.
4. What could be a deal breaker?
If your web business has to be operated in your country of origin and can’t be moved, make that clear in your advertisement. You don’t want unnecessary arguments and a lost sale due to a misunderstanding that can be easily corrected.
This applies equally if you operate in a regulated industry. Industries such as health, finance, law, gambling, weapons, tobacco, sex and drugs are all industries accessible online, but regulated in different countries. If you want the sale, don’t assume the buyer will know there are potential compliance issues with your web business. You want an easy hand over, not an argument.
If you are selling because your being prosecuted for non-compliance, be prepared to disclose that reason, otherwise there is a risk the sale could be reversed for misrepresentation.
5. The sales contract
You know the saying “Whoever has the gold makes the rules”? Well, whoever writes the sales contract makes the rules. If you don’t think it’s a big deal, consider this: most standard business sale contracts require the seller to give warranties about the business for a period of time after the sale is complete. Non-compliance with warranties usually results in some form of payment by the seller to the buyer. So you might think the sale is done and dusted, then months later get a demand from the buyer that you are contractually obliged to meet.
If you’re selling a low value web business then both you and the buyer might be happy to stick with informal contractual terms [link to previous article] agreed over email or private message, or consider whether the standard Flippa terms will work for you.
If your web business is worth more than you can afford to lose, then invest in a formal contract. Do not copy and paste a collection of agreements from the internet. I know how tempting it is to use the ‘free’ option, but if you don’t understand the way different clauses in an agreement interact, and what is actually enforceable in your jurisdiction, you can be creating a document that is full of contradictions and ambiguities that take away your rights.
6. Be realistic
Be realistic on price expectation. Have you watched Dragon’s Den or Shark Tank? Many people are disappointed because they don’t really understand the market. Also think about timing; seasonal changes can impact the appeal of your web business. Have a look at the Flippa seller’s guide for practical steps you can take in getting ready for sale.
On the other hand, if you have a clear idea of what you should be able to expect from the market and don’t want to sell for less than a fixed amount, set a reserve. If you don’t set a reserve you agree to sell at the highest offer, like it or not.
7. Consider your sale from a risk versus return perspective.
High risk needs attention, low risk needs a decision from you whether or not the cost of fixing the problem will add value or create a return roughly even with or better than your investment. Reducing high risks may not show an immediate return on the bottom line, but it does make your business more attractive. Have clear answers for all the questions that a buyer might ask and that might give you a ‘no, no longer interested’ instead of a ‘Yes, lets deal’.
Hopefully, with these tips in mind, you can more easily navigate the legal waters of selling an online business.
Have other tips? Let us know in the comments below.