Tips and Questions about Evaluating Sites on Flippa and Avoiding Scams

[papagate$$]

I am looking to buy a site(s) on flippa for my next venture's, as I am currently kind of inbetween projects. I know that flippa is full of scams and just wanted a better idea of how these scams work instead of having to spend the money myself before I figure them out. So I have a few questions about buying sites.

1. How are there so many undervalued SEO, Social media, or other service sites for sale. I regularly see these sites going for like 4x monthly revenue, even when they have verified traffic and revenue? I am in this field myself, so I know it very well, and I just can't quite grasp, how and if they are scamming people, or if they are just undervaluing their sites?

2. When you see a "possible linked to" for a seller, how is this linked? I saw somewhere it was by credit card, but I am wondering if there is other ways it could be linked.. Is this possible linked to an almost sure sign of a scam or just a precaution?

EDIT with Meathead's response I found from another thread: "They don't disclose all the metrics, but it's usually things like IP, phone number, address, payment details, bidding patterns etc. It's an automated system so not always 100% accurate."

3. When a site has been relisted 2x+ in the past 6 months, by different sellers, this is a sure sign of a scam or a dissatisfied buyer right? It always seems like this happens on the auctions I already feel sketchy about.

If anyone has good experience and wouldnt mind taking a look at a few sites I'm considering buying to see if they can punch any holes in the scam, that would be greatly appreciated. I know byranon has a service of due dilligence, but i really want to understand things better myself as I will be evaluating 100's of sites.

 

[bryanon]

1. How are there so many undervalued SEO, Social media, or other service sites for sale. I regularly see these sites going for like 4x monthly revenue, even when they have verified traffic and revenue? I am in this field myself, so I know it very well, and I just can't quite grasp, how and if they are scamming people, or if they are just undervaluing their sites?

The majority of these service sites either produce very little to no revenue (revenue is faked) or utilise non-disclosed paid revenue sources (effectively making the site not profitable). There is also a popular scam where the seller indeed has a [insert something here] service business but what he's selling (over and over) isn't this business but its clones. The seller then uses the revenue data from the main site to prove the revenue of a site that in reality is a dud and doesn't make a single penny.

2. When you see a "possible linked to" for a seller, how is this linked? I saw somewhere it was by credit card, but I am wondering if there is other ways it could be linked.. Is this possible linked to an almost sure sign of a scam or just a precaution?

EDIT with Meathead's response I found from another thread: "They don't disclose all the metrics, but it's usually things like IP, phone number, address, payment details, bidding patterns etc. It's an automated system so not always 100% accurate."

Looks like you answered this one yourself (or well, Thomas did). Mind you though, don't take the "It's an automated system so not always 100% accurate" statement too seriously. It's true, but it's best ignored as in the majority of cases Flippa's flagging system works and telling yourself after seeing a "too good to be true deal" that maybe in this case it's giving you a false positive is just deceiving yourself.

3. When a site has been relisted 2x+ in the past 6 months, by different sellers, this is a sure sign of a scam or a dissatisfied buyer right? It always seems like this happens on the auctions I already feel sketchy about.

Or it could be someone who bought the site with the intention of improving it and then quickly re-selling it in the first place. But I agree, in most cases this seems to be happening due to the reasons that you've mentioned.

Speaking of DD in general, the first and main things you need to always look at are:
1) Is the site's traffic and revenue proven in a way that is extremely difficult to fake?

To further verify:
1A) Do the site's traffic and revenue figures make sense when looked at together? (e.g. a site generating $10,000 a month on 500 visits a month would mean that the avg RPU is $20, which is extremely unlikely.

1B) Do the site's traffic sources check out (e.g. if the site seems to get the majority of its traffic from Google, does it actually rank for the keywords that seem to be bringing in the traffic? Similarly, if the site gets lots of referral traffic then do the referrers actually link to the site and why?)

3) Proper analysis of the site's link profile (if it's a site that relies on search traffic) - you will need a service or a paid tool for that, unfortunately. There are some free options out there but none have enough data or give you a good enough overview.

4) Background check on the seller. If the seller is dodgy then don't deal with them, no matter how good the deal seemingly is.

This is a very, very quick intro. There's a whole bunch of other things to look at to be able to make fully informed decisions but the above is a good start and if everybody did just these four DD checks a lot of the scams that we hear about wouldn't happen.

Bryan

 

[papagate$$]

Awesome. Thanks for all that info. I think I'm on the right track. I think one of the best indicators from my short experience is how willing the seller is to answer questions and communicate. If a seller doesn't want to answer simple questions to get a bid, he probobly isn't someone I want to deal with. That is why so far I have insisted on a skype convo or at least a long pm convo before a bid is placed.

 

[bryanon]

I think one of the best indicators from my short experience is how willing the seller is to answer questions and communicate.

You will quickly find that (especially on the higher end) scammers are often very willing to answer all sorts of questions, and many of them come off as very likable. So this particular indication is guaranteed to give you a ton of false negatives.

With that said, I also always insist on at least a Skype call prior to buying a site, and generally don't want to deal with people who aren't willing to answer questions or are generally not easy to work with. Not because they are likely scammers, but because I just don't like to work with unprofessional people and also know that people who seem unwilling in general are almost definitely not going to stick around and help me out should there be any questions after the money changes hands.

 

[kvmcable]

The amount of seller participation will also depend on the target price of the property. If you're looking at start-up websites then don't expect much seller participation. At that level it's purely a numbers game and they aren't going to waste time "chatting" when they could be supporting their buyers and building more sites.

Just like when you shop at WalMart you're not going to find professionals that can answer all your questions but if you walk into a specialty store you'll most likely find someone much more knowledgeable than yourself about their products. Of course the specialty shops don't jump on the pole and start dancing for you until they see the money. Too many people walk through their doors on a daily basis looking for a free show.

I own a specialty store and our knowledgeable people (techs) rarely talk to tire kickers. Too often when we first started in business we found these leeches just sucking up information so they could fix things themselves or order online. A good friend of mine is running into the same thing and he just sells scrubs (medical uniforms). Can you believe 2-3 times a week, potential customers walk in, open new product and try them on, sometimes trying on 8-10 items with his employee's assistance and then say, "Thank you, I just wanted to make sure what size I needed before I ordered them online". At first he thought this was just a one time thing with some retail ignorant customer so he didn't change policy. Once word got out, he had 2-3 every week doing the same thing and now he's changed his policy to stop this BS.

Anyhow, back to websites, the higher price level you're looking at the more transparent you'll find the seller if everything is on the up and up. Also understand, the higher the price level the better the seller is at deceiving the buyer if that is his intention.

 

[bryanon]

Also understand, the higher the price level the better the seller is at deceiving the buyer if that is his intention.

Exactly.

What many people don't realise is that the profile they have in their heads for an average scammer (from a third world country, speaks broken English, afraid to speak on the phone, generally sloppy and unintelligent) doesn't apply at all when it comes to large scale fraud operations. The people pulling off $50k+ scams are typically the exact opposite of the people selling $500 sites that "made $612 in the last 9 days!!" - they're typically very intelligent. Hell, I've even encountered scammers whom I would hire or become partners with if I didn't know what their "profession" is!

 

[papagate$$]

Thanks again to you both for your help. Is there anyone who has been very succesful in the site flipping field that just purchases undervalued sites, fixes them up a bit, and then just cashes in each month as they bring in profit? This is along the lines of what I am looking to do, as I am still in college with a large amount of capital from my last business and really just want experience in as many different ecommerce fields as possible, while still making money while I do it.

In your experience, what niches/fields have you found or seen the biggest steals or just solid deals on flippa? I am most interested in prod/service related businesses, as I do not want to be in adsense or affiliate fields.

 

[mred27]

There is a "free" WSO called "Flippa Revolution" among others (Google It). Haven't reviewed it but it may have some insight. Too new to post URLs but you can search for it.

Flippa is like navigating a mine field. You may find a golden nugget with your metal detector but most likely will find a ton of mines ready to explode within your wallet.
I agree there are a ton of sellers who clone the same site and sell it over and over again as if new. Check their history and how old the domain is and if it isn't "seasoned" a few years, you have a red flag. I would say avoid those flipper clone sites that usually have domains registered a month ago pitching high earnings potential. Some of those type sites are about SEO (Driving traffic with FB likes etc), hotel booking, dating sites etc. I would check the seller's rep,total sales. I have bought many of those sites but since they were cheap, I can't really complain about those.

It is quite easy to falsify revenue/traffic numbers and even have fake traffic show up in google so caveat emptor.

I even did a small audit of some high profile listings back in March proving many of these points and submited a report to Flippa but they did nothing about the listings that violated their own policies so I wouldn't depend on them for much help. PM me if you would like that information. Cheers!

 

[master god]

you can get scammed on flippa? how come? lol i thought it was secure

 

[Young Gun]

Cheap sites are always scams. 90% of the time I hear about scams they are the $500-2500 websites. Anything legitimate and worthwhile will be a lot more than that.

 

[papagate$$]

I'm going to keep updating this thread with the wisdom and usefulness I learn on my journey.. I'm pretty much devoting all of my work time to learning this business and I think I can help others in this space as well.. One thing I've really learned is that you HAVE to familiarize yourself with a large amount of sites, different niches, types ect... I have seen soo many deals that I shouldnt have even considered from all that I've learned now that I would have considered a few weeks ago.. I would advise at least 2 weeks of just watching sites, evaluating them, see the bidding patterns, see what the sell for, see common scams, see overvalued and undervalued sites.. All of this can't really be learned in a day you have to watch tons of sites to really get an idea of what it a good deal or not. So please.. don't just go into flippa gunz-a-blazing bidding on the first site you see cuz its 4x monthly revenue.. there is probobly a reason for that.. whether its a scam, declining revenue, a ftc warning, it could be anything so always dig deeper.

 

[Murdoch1337]

Cheap sites are always scams. 90% of the time I hear about scams they are the $500-2500 websites. Anything legitimate and worthwhile will be a lot more than that.

Not true. I've bought numerous cheap sites that ended up being great.

 

[LaLore]

I recently spotted a seller listing video sites over and over. Obviously, they're really profitable for him. However, I think it's the domains that are sealing the deal. He lists the sites with "Aged" Domains and "over 20k Strong Backlinks". While I know how to check to see the validity of an aged domain, I'm not sure about the backlinks. He lists a magestic seo screenshot as proof that looks legit but something just doesn't seem right about an aged domain with a ton of backlinks selling on a $160 BIN.

 

[jaypee77]

interested conversation thanks guys

 

[BlackHatSoda]

I'll make it quick and easy for you: If you're a buyer, don't waste your time. You could build profitable sites in less time that it takes to even find a good deal much less the time it'll take to try and ensure it actually earns what was claimed long enough to make your money back and some profit.

The only exception to this is if you're buying sites to build a backlink network, then there can be some options but they're usually overpriced because all they are is some expired PRX domain with some crappy WP theme and filler content. All you really want is the domain but they're selling it as if the site was worth anything.

Better luck on expired domain auctions, toss WP and a decent theme up and fill it with some content either similar to the domain's original content or even the actual, original content via wayback machine.

Find out what keywords the site ranks for with this original or close to original content and monitor it for a few weeks or so. See if Google starts dropping all ranking indicating it may have put a penalty on the site. Some rank drops is expected if the content isn't original and in some cases, even if it is. Once the site is stable in Google's eyes, start adding whatever new content you want. Doesn't even have to be related to the rest of it.

Other option is to just put whatever content you want from day one and this can work if the backlink profile is strong enough. If you've got 15-20 links from baby stroller sites and you slap up some Call of Duty content, Google is going to devalue those links.

I think it's better to keep the site looking as original as possible to maintain backlink value then add new content and use that as your backlink sources.

 

[BrianneJBaggs]

Hey thanks for sharing your views and not all sites are scams.

 

[lrussell5]

Not true. I've bought numerous cheap sites that ended up being great.

I would love to know where you found these decent sites, I look everywhere and have tried contacting hundreds of site owners who seemed to had lost interest in their established sites but nothing?!

I came across a nice site for sale by chance a couple of years ago and have done really well with it, would much rather that then go through the time and effort of building one from scratch.