We Are Looking To Buy Websites

Posted on October 30, 2012 by ibuysites

buy websites

Midascode Ltd is actively looking to buy websites

We have two options:

For sites earning $1000+ per month and
Sites earning less than $1,000 pm (or earning nothing at all).

a) Is your site one that has a lot of potential (even if it’s earning nothing now)?
b) Does it just need some marketing or some monetising?
c) Is it a promising site that you just don’t have time for any more?
d) Is your site ready for the next level, but you don’t have the skills to take it there?
e) Has your direction changed leaving you less time to work on your website?
f) Does your site or blog need a bit of investment to make it profitable?

If you’re looking to sell an “offline business”, please visit this site.

Doing Due Diligence on Flippa Listings

Posted on August 31, 2012 by ibuysites

There’s an interesting new development that every buyer should be aware of before even bidding for a site at Flippa. It’s a new due diligence tool. It’s completely free and you would be crazy to not spend a few minutes using this tool on any Flippa listing you’re considering bidding on.

First, some background.

Flippa has long suffered from a problem of sellers opening multiple accounts. This is in violation of the Flippa rules and creates opportunity for shill bidding. A seller could pretend to be somebody else and bid on his own auctions to keep pushing the price up. You, as a buyer, don’t know the identities of other bidders and you’ll keep increasing your bid to compete with the seller himself who strings you along to a point of his choosing before he drops out.

This is illegal, but this is the internet and if Flippa don’t know about a seller’s multiple identities, they can’t block one of those identities from bidding.

To be fair, Flippa have made some progress in this regard. If multiple accounts log in from the same IP, they flag the accounts as “possibly connected” and you can see that note on the seller’s profile page.

However, people like the admin of the Experienced-People.net forum of website buyers and sellers, argue that Flippa aren’t going far enough. He points out that as it’s sellers who pay Flippa, it’s in Flippa’s interest to allow a bit of this shill bidding particularly if they can be seen publicly to be taking actions against some accounts by banning the occasional miscreant. That protects their public reputation while allowing some shill bidding to happen that ends up enriching fraudulent sellers and, indirectly, Flippa themselves.

Buyers have no way of querying a seller’s details to see if he has multiple accounts at Flippa and is a likely candidate for shill bidding. The only information they have is when Flippa discloses on a seller’s profile that he is “possibly connected” with another account. In most cases, there isn’t any connection disclosed here.

That has all changed. The Experienced-People forum has worked out an ingenious way of detecting these fraudulent connections.

It’s a bit technical, but bear with me here. Example: A seller has several accounts in Flippa, let’s call them account A, B, C and so on. He lists sites for sale using these different accounts and uses his other accounts to bid on his own auction. There is no real public information available about the seller – no name, no phone number, no email address, no IP! But, and this is the clever bit, all those sites listed under different names may be hosted in the same hosting account and may be registered to the same person! These sites may share the same hosting IP, the same obscure name servers, the same WHOIS phone number.

That’s what the new tool does. It goes behind the scenes to connect these dots for you. You can take it for a test run here. It is completely free and we understand it will always stay free. If you need a demo of what can be done with the tool, have a look at this post on their forum. Other parties have also started using it to expose some of the scammers, shill bidders and other less than honest sellers on Flippa.

Bookmark the page, and get familiar with using it. It’s going to become a key tool in the due diligence arsenal of every buyer.

Flippa Security Possibly Compromised, change your password

Posted on July 20, 2010 by ibuysites

Reports are circulating of a security breach at Flippa and screenshots have been posted online of what their admin interface looks like.

The known hacker (and possibly some unknown ones) may have had access to all Flippa accounts, private messages, bids, watchlists and other user controlled functions.

Flippa has neither accepted nor denied the allegations.

It would be a prudent move to change your Flippa account password. If you’ve ever given Flippa access to take a pdf of your Google Analytics stats, it may be worth changing the password of your GA account as well. If you’ve used Flippa’s integration with the escrow.com service … you get the picture.

As Flippa and Sitepoint have common logins, this may apply to you even if you don’t use Flippa, but have an account at the Sitepoint forums.

Flippa Announces Major Change – Addition Of Escrow Service

Posted on January 28, 2010 by ibuysites

I don’t believe anyone has blogged about this yet.

Details are patchy at the moment, but Flippa’s General Manager Dave Slutzkin has announced that Flippa is adding an escrow service to their site. It’s in partnership with escrow.com (well known, but seriously flawed) and is likely to be an optional service buyers and sellers can use at Flippa.

In the past there’ve been instances where Flippa wasn’t paid the “success fee” for a site selling in their marketplace. The advantage with having an in-house escrow is that Flippa will now know when a site sold in the marketplace has changed hands (whether on not the WHOIS is modified). Honest buyers and sellers who aren’t looking to cheat Flippa out of their success fee should have no issues with Flippa knowing the sale completion date.

It’s not yet known whether the pricing will be fair i.e. users being charged for only the service provided: escrow on the domain. It may well follow escrow.com’s current pricing: price based on the entire value of the site even though it’s only the domain that’s getting escrow protection.

All You Wanted To Know About Website Buying & Selling

Posted on January 12, 2010 by ibuysites

Here’s a headsup: People wanting to discuss matters relating to the buying and selling of websites now have a new forum where they can chat with like minded individuals.

The quality of the chat is extremely high and though the forum is only a week old today, it boasts some of the most respected members from places like Sitepoint and elsewhere who advise on the subject. Already signed up are brokers, accountants and lawyers who deal with matters like Accountancy Due Diligence and Contracts of Sale, buyers and sellers. Flippa is there asking questions and getting feedback on how they can improve their service.

It’s a place where you can find out about the best places to buy a site, what scams to watch out for, what’s a fair price, how to perform due diligence, the best places to list a site for sale, how the pros make money from site holding and site flipping …and much more. Head on over and pose them your most difficult question.

If you interested in any aspect of website buying or selling – you need to be there. Go to the Experienced People forum right now. If yours is not an internet business, the related site for selling a business is this one.

Five Scary Things You Didn’t Know About Escrow.com

Posted on December 15, 2009 by ibuysites

When buying or selling a domain you are often dealing with a party you don’t know. Do you remit a large sum of money to them and trust them to transfer the domain to you? Probably not. But then again, they don’t know you either, so they can’t transfer the domain to you first in the hope that you will indeed keep your promise to pay them in full.

That’s where escrow companies come in.

An escrow company will take the full payment from the buyer and hold it till the seller transfers the goods. Once the buyer confirms that he’s received the goods the escrow company releases the funds to the seller. Should the buyer reject the goods, the escrow waits for the seller to confirm receipt back before they refund the payment to the buyer. So everyone’s safe.

But it’s important to choose a good, trusted escrow company to handle what is often a large sum of money. Who do you go to for that? The most well known name is escrow.com. Most experts in website buying and selling swear by escrow.com and they do so with the experience of many transactions behind them. But today I’m going to tell you five secrets that you really should know before you deal with them.

Five Things That You Did Not Know About Escrow.com and Which Should Scare You

1. There is no company called escrow.com. The company you are dealing with is IES that rents/leases or has some other arrangement involving the escrow.com domain (I don’t know what it is and you likely don’t either). That’s not a reason to distrust them but you need to know who you are dealing with. Should IES go bust sometime – no company is immune from the laws of finance – the escrow.com name will likely continue and many buyers and sellers will likely be unaware that anything has changed even though they may be dealing with a brand new company with no history! They’ll assume it’s the good, old escrow company they’ve always dealt with. On the escrow.com website, you’ll find bold claims about “services provided by escrow.com“. They flash “escrow.com” all over the site. Even their postal address is “escrow.com” (no mention of IES). You need to go to the small print to realise that it’s IES you’re dealing with and, in their own words, they are only “one of the operating subsidiaries of Escrow.com”.

Disclaimer: I’m not suggesting anything about IES’s current financial position. They may be rock solid for all I know. And do bear in mind that they are heavily regulated (more about that later) so they don’t do a runner with your money.

But “they” are not escrow.com.

2. Escrow.com/IES doesn’t provide an escrow service for websites: Seriously! It never ceases to amaze me how few people know this. Or realise the huge risk involved in putting website transactions through this company. IES has four categories: Motor Vehicle | Domain Name | General Merchandise | Services.

The closest you have to websites is “Domain Name” and people happily choose that as the closest match and think all is hunky dory. It’s not!

Risks for Buyer: You can end up getting just the domain name and none of the files, templates, designs, databases or anything else that is contained in the website you’re buying and, as far as IES is concerned, they’ll release the funds to the seller on the sole grounds that he has transferred the domain control to you.
Risks for Seller: You can transfer all the copyright, other rights, programs, files etc., to the ownership of the buyer and the buyer can then demand IES give him a refund because he’s changed his mind about taking control of the domain.

3. IES/escrow.com don’t give a fig leaf about your contract. In the purchase of a website the buyer and seller often negotiate terms and draw up a Sales Contract. It may say that certain conditions need to be met and that the buyer/seller can pull out of the transaction if there is a material change. Example: You agree with the seller that if his PR9 site suddenly drops to a PR4 then the deal is off. You send your funds to IES for them to hold during the 10 day “inspection period”. The seller changes the WHOIS for the site and sends you the password to take control of the domain. But on the very first day you find that the PR has dropped (or there is something else drastically wrong with the site and it doesn’t match what the seller described). Tough! As far as escrow.com/IES’s terms are concerned your agreement has no value. The seller gave you control of the site and if he wants to complete the transaction then IES is just going to release the funds to him. The contract entered into by the Buyer and Seller is a carefully constructed document designed to protect each party’s interest. IES won’t even look at that contract. They go by their own terms and conditions and it may or may not be in your favour.

To be fair, you can try raising a dispute or arguing the terms with IES, but there’s no guarantee you’ll succeed, it’s entirely up to them.

4. Many of the “experts” who recommend escrow.com are doing so because they get a commission. Escrow.com is one of the few (if not the only) escrow companies that has an affiliate program. That they are paying people to recommend them is not reason enough to shun their services. But be aware that any recommendation of their service may be driven by expectations of commission rather than a desire to help you.

5. Escow.com is regulated by an authority on another planet. Most experts agree that while the banks took a lot of liberties it was ultimately the regulators who failed in controlling the financial institutions and were responsible for the credit crunch of 2008.

But there is no regulator on this planet quite like the Commissioner in California. He sounds like a cross between Saddam Hussein, Michael Jackson and Imelda Marcos.

He’s power mad and a bit crazy. Nobody – anywhere in the world – can do this business with anyone based in California unless they pay the Californian Commissioner huge amounts of money, bow to his authority, promise to jump when he says jump and sign up to lots of nonsense. But the madness doesn’t end there. If an escrow company in Syndey or Singapore or Sierra Leone decides they can’t be bothered with some jobsworth in California, they need to be aware that he has banned anyone, anywhere in the world, from saying anything critical about him. I promise, I’m not making this up!

That’s just the start. If you read the California Financial Code (div 6, 17000-17305) there’s some pretty serious stuff in there that should dissuade anybody from buying or selling a site if the party they are dealing with is California based. But if the escrow company is registered there it’s even more serious. You will almost certainly lose should a dispute arise. In fact, if they file a court case against you in California, they don’t even need to inform you of the action. In can be all decided in your absence.

Read the full story of the California Risk here.

So even if IES is a very trustworthy company, has a strong balance sheet and great customer service, the fact that they are based in California and signed up to the California Financial Code is reason enough to go look elsewhere for your escrow needs.

Reliable escrow companies that proudly declare they are not registered in California:

Moniker:

Moniker is an ICANN Accredited Registrar and the only company with a special domain escrow account at its registrar to safely hold domains and protect both buyer and seller of domain related transactions. (not registered in California… for the moment)

iEscrow:

I-Escrow, Inc. is Licensed by the Washington Department of Financial Institutions (No. 540-EA-42257) and adheres to its strict regulations, as well as the ordinances put forth by the Revised Code of Washington.

SEDO, escroweurope, Escrow Europa (recommended by eBay) etc., are other alternatives.

5 Steps For a Smooth Migration of a Site or Server

Posted on November 20, 2009 by ibuysites

Moving a site from one hosting company to another can be easy or fraught with problems and cause you to lose days in downtime and/or lose valuable data. The key to moving a site safely – whether it’s a site you’ve owned for a while or a website / blog you’ve just acquired – is preparation, preparation and preparation.

Plan 10 times, move once.

Here’s a brief guide to the process.

Step 1: If it’s a new acquisition, transfer the domain name to your control.

Step 2: Download all the site’s files and folders with the correct structure. If it’s an acquisition, get a copy of the applications (if any) and database/s (if any) together with a zip of all the files. Even better if you can get copies of the traffic stats for your future reference as they’ll get lost when the old hosting account is closed.

Step 3: Upload all the files, databases etc., to your new hosting account. Make sure you put them all in the right location. Ask your hosting company for help if you are not sure. (Do all this while the site is still fully operational at the “old” server).

Step 4: Configure the files, set permissions etc., and test, test, test to make sure everything is working as it should.

Step 5: Change the DNS settings at the domain registrar to point to the new IP so visitors can now reach the site at the new location.

More information on moving WordPress blogs can be found here, here and here. And guides to moving Joomla blogs can be found here and here.

How has Flippa settled in?

Posted on October 22, 2009 by ibuysites

As many of you know, Sitepoint has split its marketplace. While link exchanges, service advertisements etc., are still with Sitepoint, website sales have moved to a new company and a new domain: http://www.flippa.com.

Flippa, controversially, charges a “success fee”. While you still pay for listing a site – albeit, a slightly lower price than before – there’s a hefty 5% success fee (capped at $500). A summary of what has changed is on this Sitepoint thread.

Flippa does offer more filtering options and allows site buyers to specify just high PR sites, low Alexa ranked ones or those selling for more than $10K, for example. There are a few other improvements though it’s hotly debated whether the Web 2.0 look is an improvement on not. The overall Flippa concept and implementation come in for scathing attack in the comments on Flippa’s own blog triggering a frantic response from Flippa that they really are taking feedback.

The name, Flippa, and the overall design and focus of the new enterprise seems to cater for the lower priced-lower quality sites at the expense of the better ones. For example, anyone interested in buying a listed site at the BIN price is expected to complete the transaction immediately via Paypal. All well and good but Paypal has a limit of $10K. It’s apparent that Flippa doesn’t expect to list a lot of websites at above that price point. Interestingly, that’s the price point at which their success fee maxes out (5% of $10K = $500 which is the success fee cap).

What do you think of Flippa?

Added: Snapshot of Flippa page when you click the BIN button
flippa2

Top Five Website Selling Scams

Posted on September 11, 2009 by midascode

Top Five Website Seller Scams

You’ve seen your dream site, all the figures add up, the price looks good and the transaction is going through escrow. Nothing to worry about, right?

website scammers

STOP!

Website Selling Scams To Avoid!

Take a step back and have another look. Having experienced several
hundred transactions and dealt with virtually thousands of sellers, we’ve
learnt that what looks black and white may appear a distinct grey under the
due diligence microscope. The top scams we see by website sellers are:

1. Inflated earnings: The screenshots themselves could be faked. And,
let’s be honest, sellers can’t go giving out the logins and password to
their earning accounts. They may offer the closest alternative: access via a
screen sharing software. In theory, you both install the software and you can see
what’s on his screen. He navigates and clicks based on your phone
instructions.

But, beware, that’s not infallible. There are javascript tricks and
manipulated host files that could make you think you’re on Google’s
Adsense stats page when in fact you’re not! Even if he’s given you direct
access to his affiliate account, YPN stats or PaypalÂ login, the
earnings may not be what they seem. The figures can be inflated in a
multitude of ways but the two primary routes are to over state what’s coming
in and to understate what’s going out. In examples, revenue could be
inclusive of money made on other sites and the cost of all the advertising
required to make that revenue could have been swept under the carpet.

2. Inflated traffic: It’s often the case that buyers see a site
they believe is under-monetised and base their value of the site on how
profitable they think they can make it using their own monetising
strategies. This usually relies substantially on their assessment of the
traffic. But how reliable are those figures?

The simpleton seller may repeatedly hit the site from his own PC, or set
up a script to do that for him. Examining the traffic stats and the IPs of
the most frequent visitors blows this trick out of the server logs. But what
if there really are millions of visitors from different IPs?

Visitors can be bought. There are numerous programs that sell millions of
“visitors” for a few dollars. However, many of them send just bots or
visitors of very low quality (perhaps by loading your page as a pop-up on
some heavy traffic sites). The wary buyer satisfies himself not just of the
quantity of traffic but also the quality. Here are some neat tips and ideas on
traffic logs and getting useful information out of them.

3. Hidden time costs: Professional businesses account properly for
all time used in the managing and running of the business. If the
owner/manager puts in some hours, the cost of his labour is deducted from
the profits. Most webmasters selling sites ignore this basic accounting rule
and as a result their profit figures are over-stated.

The principle is simple: Profit is reward for capital and risk. Salary is
the reward for time spent. You cannot arrive at a profit figure unless you
first deduct the notional cost of salaries (even if those salaries haven’t
actually been paid out). It’s factors like value of seller’s time and
depreciation that are the main reasons why companies’ final accounts are
recalculated (“adjusted”) for the purpose of a business sale.

Always recalculate the profit based on your careful estimation of the
level of skill and the hours you’d need to employ to replace the owners.
These tools and spreadsheets may be handy.

4. Fake Page Rank: Fortunately, most buyers now know how to check
for fake Page Rank. However, what they use for their investigation are “fake
PR checking tools”. They omit one of the most important checks: archive.org.
Yes, the Wayback Machine is a powerful tool when relying on the PR of a
site’s pages to decide the site’s value and, let’s face it, some of us are
influenced by Page Rank when buying sites.

How does archive.org help? It doesn’t give you PR, it doesn’t tell you
the past PR of any page. What it does show is how a site used to look in the
past. If the last cache of the site is considerably different it should ring
alarm bells. Large organisations like government bodies, quangoes,
educational institutions, companies etc., often own multiple websites.
Sometimes they forget to renew a domain registration and domainers quick on
their feet snap up these domains. The original content is promptly replaced
with some new material and it’s flogged off as a “quality site”.

Risk: Buying a site based on a dropped domain invites legal action.
There’ve been numerous cases where the previous owners claimed the domain
back and … won. But that’s not the only risk.

Update 2016 – Google Confirm Page Rank is no more!

Unfortunately some sellers are still claiming Page Rank or a variant of it!

5. Dropped domains: Dropped domains that have been quickly
re-registered by opportunistic domain vultures still show PR in the Google
toolbar. However, Google is aware that the domain was dropped and often
wipes the slate clean on both PR and backlinks – treating the site as a
completely new one. As PR updates don’t happen on a daily basis, the new
site owner may end up putting a lot of effort into his site only to find
that at the next update PR reverts to 0. Further, he usually also loses all
linkback credibility as the original links were made for the previous
content and purpose of the site.

More by this author on buying and selling businesses

Will The Economic Crisis Affect Website Prices?

Posted on October 10, 2008 by midascode

Today we ask the question: With all the economic and financial problems around the world, what affect will this have on the prices of websites and web businesses being sold?

crisis

Will the credit crunch mean that people start selling their websites to raise some money?

Will investors see websites as a safer investment than the stock market?

Put your thoughts in the comments below.

Midascode

Midascode – Buy & Sell Websites Blog

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Category: Selling Websites