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What's the drill here?

Discussion in 'Site Flipping' started by SebastianG, Sep 11, 2012.

  1. SebastianG

    SebastianG Junior Member

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    Excuse me if this has been asked before, but I assured you I looked for existing answers for quite a reasonable amount of time now.

    My question is, what's the drill here? with Flippa? I see people selling websites for half as they would make in 1 year. What's the drill here? if I can buy a website and get my money back in 6 months and then keep earning from there on?

    Why would anyone sell such websites for such prices in the first place? It just doesn't make any sense to me right now (I'm sure I'm missing the big point here, help me understand).

    For example, there's this 2 year old website being sold for 400.000$ that has an average income of 120k/month in the past 5 months. What's the downside? What's the drill?

    Thank you, and excuse me if my question is a little bit... inappropriate. Best of wishes.
     
  2. catardat

    catardat Senior Member

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    The drill is that one of my websites was earning $10k/month before penguin hit it, after the hit was making max. $300/month. This is one of the main reason I would not buy a website from Flippa. But this is not the only reason, anything can happen before you even make the money you have invested.
     
  3. chris1025

    chris1025 Regular Member

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    scam my friend.
     
  4. kvmcable

    kvmcable Supreme Member

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    The majority of Flippa sellers lie. I say the majority with great confidence.
     
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  5. SebastianG

    SebastianG Junior Member

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    So, basically, most websites for sale are either scams, lies or simply websites that will lose all their value in the near future?
     
  6. bryanon

    bryanon Executive VIP Premium Member

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    As people have said above, a lot of the listings (especially the low-end listings) that you see on Flippa are either downright fraudulent or sites that operate an extremely risky and non-sustainable business model.

    Decent, sustainable sites almost never sell for a 6 months multiple. For decent sites the multiple is closer to 1-2 years.

    Another thing that you have to understand is that most websites are a far more risky investment than most traditional investments, such as offline businesses, property or even stocks. Many sites depend mainly on one traffic source, meaning that if this traffic source disappears for some reason (such as a site getting pushed down in rankings with the next Google update), the revenue stream is effectively dead. This is why the multiples in this industry are generally lower than those that you can see elsewhere.
     
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  7. Kahoona

    Kahoona Newbie

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    Yeah lots of scammers on Flippa, tread carefully.