Buying a Website
About a month and a half ago I purchased a website.
I didn’t even realize that you could buy a website until the beginning of this year. I found out about it from a interview on a podcast by SmartPassiveIncome.com. Pat Flynn interviewed Justin from EmpireFlipper.com.
The idea intrigued me, but was not something I was planning on doing for a while. Let’s be honest, I hardly have any experience with websites. This blog is run by a free Blogspot account by google. Yes, I have a little bit of experience…but not much. I’ve had this blog for about 3 years and have been able to monetize it a little (although, that has never been the goal of this blog). But, recently I decided to take a risk and purchase a website.
Here’s my experience purchasing a website
So I had been keeping an eye on the available websites every once in a while and just recently I decided to take the plunge…and I bought my first website. Definitely a nerve-racking experience. What if it goes bust?...it definitely could). What if there are problems that I don’t know how to fix with my limited website knowledge?
Here are some of the potential problems that I thought of:
- · Is the site a legitimate site?
- · Is the current traffic and revenue verifiable?
- · Is the revenue/traffic a temporary thing that will soon decrease?
- · Will running the website require too much time?
- · Will running the website require too much knowledge or expertise that I don’t have?
Criteria I set for my purchase:
- Be able to afford the possibility of losing all the money. Yes, it would devastate me if the website was not profitable or if somehow I got scammed, but I understood that was a slight possibility. I was not using money that I absolutely need. i.e. I wasn’t using emergency savings.
- Website be at least 6 months old, preferable at least 1 year. I figured the longer the website has been around, the more stable it will be.
- Some organic traffic. I wasn’t too comfortable with traffic from paid advertisement.
- No more than 1 hour/per week required to operate the website. Ideally, I wanted a site that was basically on autopilot. I would be okay wilh a little bit of time required to maintain the current levels of income. I know this is possible, because my blog doesn’t really require any time to maintain current revenue (if I stopped blogging, my blog would still continue to make the same amount of money).
- Purchase the site from a genuine person. This is hard to really know for sure, but I wanted to be able to talk to the seller and get a feel for why he was selling and who he/she was. I wrote down a list of questions and went over them when I Skyped with him.
- Purchase a website that was no more than $15,000. For me, this is actually a lot of money, but there are many sites that sell for much more. If things go really well after my first purchase and if I have some more available capital, I might consider a larger purchase down the road.
- New listing. I did not want to purchase a website that had been listed for more than a week. My thought process was that if it wasn’t sold by now, it must not be that attractive of a website.
When I was looking at the list of websites available on EmpireFlipper.com, I found a site that matched my criteria. I decided to pursue it further. I made my initial refundable deposit that gave me access to more information about the website and I was allowed to set up a Skype call with the seller to ask him more questions. I was the 5th person to put a deposit on the website so I knew others were interested. You can actually make an offer to purchase the website that is less than what is being asked, but the 1st person that made a deposit on the site will have the opportunity to better your offer. If you offer the full asking price, you will get the website. I offered the full asking price because I was worried someone else would get it before me. In hindsight, maybe it would have been wise to try offering a lower price. Who knows though.
After I interviewed the seller I felt good about making the purchase and went forward with it. EmpireFlipper support mediated the transaction and transfer of the website. It took about 1 week for the complete transfer.
One nice thing about the sale, was after the website transfer is completed you can verify the traffic and revenue that is now under your name. EmpireFlipper asked me to verify this. I think if the traffic or revenue was not as expected, EmpireFlipper would not release the funds to the seller until it was. Thankfully, the revenue and traffic was as expected. Although, it is important to note that if things go wrong with the website going forward, I would have full responsibility.
Here is a run down of the website:
- Average monthly revenue over the last 3 months: $650
- Average monthly expenses over the last 3 months: $50
- Average monthly net profit over the last 3 months: $600
- When was site created: 2012
- Monthly Traffic: 6,000
- Revenue Sources: Affiliate marketing and Adsense
Basically the site makes most of its revenue from generating leads from people wanting to purchase forklifts. I get paid $23 for every person that fills out a form on the website (feel free to visit and fill out the formJ). It also makes a small amount from Adsense ads.
My hope is that it will continue to make $400-$600 per month and have my initial investment of $12,000 paid for in 2-3 years. If it takes 3-4 years to do this, I would still be okay with that.
I also don’t plan on making any changes to the site. It doesn’t really have that great of an appearance, but I feel that if it’s working okay right now, why change it? Sometimes trying to change something that is working only makes problems. It shouldn’t really take any time for me to run and is basically on autopilot.
Am I crazy to purchase a random website? Have any of you ever done something like this? What are some nerve-racking investments you have made?