Site Flip - Flipping Web Sites, Web Pages and Domains

Do You Want to Be an Independent Webmaster?

2008-03-26T17:24:00.000-07:00

Doing business online requires work, and lots of it. If you have the drive and the passion to put in the hours however, being an independent webmaster can net you a lot of money. If you enjoy the read, consider my free newsletter.
In short, check out this post on becoming a succesful webmaster. It addresses buying and selling domain names, a variety of ways to [legitimately] make money online without any scammy "home-based business opportunity" and does not try to sell you anything. So if you believe in teaching a man to fish, instead of giving them fish, that post is for you. What's more, there are a variety of links in there for you to read more and educate yourself.

Related articles are archived in the topical categories flipping a website, tips, domains and domain names.

Domainer.com - Building Domains Into Businesses

2007-10-01T19:05:00.000-07:00

Domainer.com is a brilliant new startup that's recently raised $2M in funding. I love their business plan which is related to site flipping but with a different revenue model If you enjoy the read, consider my free newsletter.

Essentially, Domainer.com have developed a site template and domain monetization plan that they are offering to domainers. The content comes from bloggers, the revenue comes from affiliate programs and adsense, the directories from Domainer's internal development team et voila: you've got a site with content and a revenue model.

My question is: What's the difference between domainers posting affiliate ads on their site and/or adsense and Domainer.com doing that with some aggregated blog content thrown in? What is the value add that Domainer.com provides domainers that they couldn't easily do themselves? I think they've got a good idea but need to develop their platform further.

Related articles are archived in the topical categories flipping a website/home improvement, site flipping case studies, domains and domain names.

SF News: Blogrolling Peter Davis, Ongoing Case Study this Winter Break

2006-12-09T20:33:00.000-08:00

Some Site Flip news to let you guys know this blog is alive and well. If you enjoy the read, consider my free newsletter.

First, a mentor of mine and internet Guru (yes, capital G) is being added to the blogroll. Peter Davis is the author of the very useful Rules for Protecting Yourself When Buying a Website as well as being a Sitepoint and Earners' Forum moderator. In fact, he's started his own blog forum, for those of you looking to talk with and learn from other bloggers.

Second, I'd like to announce an upcoming site flipping project that will begin over winter break. A longtime friend and I have identified a niche with little SEO competition and keywords with good bids. Starting around Christmas, we'll be launching an informative site around the theme. The plan is to implement Adsense and affiliate programs, SEO the hell out of it, and then watch the money roll in in a couple of months when it owns the SERPs and gets plenty of eager-to-click search traffic. (Search traffic clicks on Adsense ads much more frequently than traffic coming to a website from another referring source, such as a link from a blog.)

For the design, we'll be buying a template, and my buddy will work on the coding aspect of things to modify it and install plugins etc. (We'll probably be using Wordpress as a content management system, though it remains to be seen if it will be a blog.) For the content, we're looking at hiring it out, with a focus on tying in the articles to related blog carnivals to gain links.

Then with a little luck and good revenue stats, we sell out. I've got some buyers in mind and an estimated price tag that should hopefully let my friend and I start other sites and businesses...

So Stay Tuned for late December when I'll name the site and show you the actual techniques we're using, the nitty gritty that gets the site ranking and earning money.

Related articles are archived in the topical categories site flipping case studies, Site Flip News.

Don't get Burned When You Buy a Site

2006-12-01T08:57:00.000-08:00

A key concern in buying a website is the transaction itself and ensuring the quality of what you're buying. The impersonal and international nature of the internet makes warranties of quality near impossible to enforce, even if law makes them an implicit part part of contracts If you enjoy the read, consider my free newsletter.

A friend and mentor of mine, Peter Davis, has addressed these concerns with a little guide to avoid getting burned in buying websites (or other online property for that matter). As an active trader and a moderator at one of the web's most popular marketplaces for buying and selling websites, domains and other online products, Peter definitely knows what he's talking about.
Among the advice he shares:
Do a background check on who you're buying from. Plug their name and online nickname into the search engines. Ask other forum members about them.
Don't count on paypal to bail you out if you get scammed. Their first interest is their own bottom line.
Harassing forum mods will get you nowhere. The most they can do is ban the account/IP, and while that may be satisfying for those seeking retribution, it won't get your money back.

There are more rules and ideas Peter that shares that I haven't mentioned here. Generally, it's excellent advice for newbies to moderately advanced site flippers, so go check it out!.

Related articles are archived in the topical categories buying a site, flipping tips, and website markets.

Finding Expiring Domains with PageRank

2006-09-17T12:24:00.000-07:00

Domaining and SEO pro Rob of the Wholesale Directory has contributed some knowledge here about finding good domains that are about to expire. The emphasis is on those domains with established PageRank, in order to speed up the SEO process of ranking the website/domain for its selected keywords. If you enjoy the read, consider my free newsletter.
I frequently field questions about how one would go about finding expiring domains with high Google PageRank. When I realized that some people are simply checking the whois for current high-PR domains and hoping the owners will forget to renew, I thought I’d share my method for finding these domains.

The serious domain speculators who make 6-figures+ from domain reselling have their own software and sometimes entire teams of people working to find them good domains. Not all of us have those sort of resources at our disposal. My method, which does not require either, can be broken down into 4 steps.

1. Find the domains
2. Trim the list
3. Check the PR
4. Check the backlinks

Finding the domains

The easiest way to acquire a list of expiring domains is from a drop catching service. Personally, I get my lists for free from Pool.com. On their website, you can download a text file(in a zip) of all domains that are expiring within the next few days. Just click on the “Deleting Domains” tab and choose “Download the Full List”. This text file can be simply copied and pasted into MS Excel or any other spreadsheet program. Sometimes the list is too big to actually paste in its entirety, so you may have to split it in half.

Trimming the list

The problem with the lists you get from Pool.com is the extra characters. The text files are formatted much like a CSV file, and contain numerical values and commas after each domain. Here is where the excel “Find and Replace” feature comes in handy. From the “Edit” menu, choose “Replace” (or “Find and Replace”, depending on what program you’re using). You’ll be presented with two text boxes: one for the text to find, and one for the text to replace it with. The text you want to find is “,*” without the quotes. Using * as a wildcard tells the program to replace all commas and everything after them. But you don’t actually want you replace them – you want to remove them. So leave the second text box empty. Let ‘er rip!

Now you should have just a spreadsheet of domains. Here are a few other search strings that may come in handy for the “Find and Replace” tool at this time…

“*.biz” – Will remove all .biz domains, and can also be used for other TLDs you may not be interested in spending your time checking.

“*2*” – Will remove all domains with the number 2 in the, and can obviously be used for all numbers if you’re not interested in domains with numbers in them.

“*-*” – Will remove all domains with hyphens in them.

If you choose to use these strings to remove domains, be aware that you will now be left with quite a few empty cells. A simple “Data  Sort” (ascending) will allow you to remove the empty cells.

Checking the PR

Now that you have your list trimmed exactly the way you want it, it’s time to begin checking the PageRank of these domains. Rather than check one at a time, you can use a Bulk PR Checker like the one at http://seotools.alfalogic.com/bulk.google.rank.php to check up to 25 domains at a time. The rest is simply copying and pasting the domains 25 at a time and checking their PR. Personally, I ignore any domain under PR4. Write down the domains that you are interested in and save them for the next step.

Checking the backlinks

Just because you have purchased a domain with a high PR doesn’t mean it will retain that PageRank after the next PR update. Regardless of whether or not you intend to develop this expired domain, a domain with active backlinks is always more valuable than one without. Since the Google site: command has been on the fritz for quite some time, I prefer to use Yahoo Site Explorer (http://siteexplorer.search.yahoo.com/) to check backlinks.

Since chances are you didn’t check the PR of every domain on your list, you may have stopped at between 10-20 domains of interest. Check their backlinks and decide on which ones you’d like to buy.

The process of buying an expired domain involved first requesting it from a drop catcher, and then bidding on it if more than one person has requested it. There is no way to know, however, which drop catcher will get a domain. For this reason, it’s best to sign up and reserve your domains at as many drop catchers as possible. DNForum.com is a great place to read reviews of drop catchers such as Pool.com, ClubDrop.com, etc.

Thanks again to Rob for the great SEO and domaining tips! Rob maintains Wholesale Wiz, the Wholesale Directory.

Related articles are archived in the topical categories the domain markets, domains and domain names.

The House Flip: Is House Flipping a Myth?

2006-09-10T14:35:00.000-07:00

House flipping seems like the ideal business: for a low capital investment and with not much effort, you buy a house then flip it for profit. (If you enjoy the read, consider my free newsletter.)

But is house flipping really all it's made out to be? Amongst my first readings on the topic when I first got into web site flipping and web estate flipping, I found a text-centric site put together by a real estate agent. The site's point was that house flipping is a myth.

The 'art of the house flip' as its proponents term it, is about fast turnaround time. You find someone interested in a property, buy it, and then resell quickly for a profit to the buyer you know. There are a few problems with that though.

First, people like to inspect a house and see if they're at ease in it. How can you give a tour of a property you don't own?

Second, a real estate agent can be sued for not finding the best price for a client. A house flipper might be sued to regain the deed if it's sold soon after the first sale. There are also other legal restrictions, varying on a state-by-state basis, which make house flipping extremely difficult or outright illegal.

Third, houses actually on the selling market that reappear on the market soon after they were bought suggest poor quality property. Agents and others will be aware of these conditions.

Really, the only legitimate house flipping is what's known as the fixer-upper. Buy, move in for 6 months to a year, renovate, clean it up, etc. and then resell. Except that if you're going to pursue that sort of house flipping, you'll find site flipping a lot easier, and requiring less capital.

Related articles are archived in the topical category flipping tips, real estate and house flipping (first post on house flipping).

Be Prepared to Sell Your Business!

2006-09-03T18:26:00.000-07:00

Be ready and prepared to sell you web site or online business, says a new site flipping piece by Laura Alter. (If you enjoy the read, consider my free newsletter. )

Laura's article as an intermediate-to-advanced article for Site Flippers. The focus of her articles is sharing advice on good business management practices that increase the likelihood of a sale, and the value a web site will sell for.

Laura starts by mentioning advanced stats tracking.

Treat Your Records – Traffic and Otherwise – Like GOLD. What is it, exactly, that you own? Your online real estate is totally virtual. It could go -poof- into thin air in the blink of an eye. So, too, could your traffic stats, financial records, and other virtual data. Do you back up your website? You should be backing up everything, all the time.

In that same vein, make SURE you have a long trail of traffic stats. [..]

Next, she shares sound advice on managing your accounting:

Does Your Bookkeeping Hold Up? How many forum owners treat their forum like a business? Whether that means hiring a virtual assistant to do your books, or simply using a program like QuickBooks to do it yourself – it needs to be done.

I won't quote anymore, because it would just be spammy. But all in all, Laura makes the great point that you're managing more than just a site. Your traffic, accounting, deals with other site owners etc. are part of managing your business. Therefore, be ready and prepared to sell you web site business by following proper management technique!

Related articles are archived in the topical categories website appraisals, buying a site, flipping a website/home improvement, selling a site, negotiating, flipping tips, site flipping case studies, newsletter, Site Flip News, website markets, domains and domain names.

Design Appraisal

2006-09-01T10:33:00.000-07:00

Designs cost a fair bit of money for the small to medium business owner, so it only makes sense that site flippers need to understand design appraisals. [If you enjoy the read, consider my free newsletter.]

My friend Ben Bleikamp has a good post on pricing your services over at Yopos, which we also chatted about.

Ben situates himself as a mid-level designer, so he charges mid-level prices. He calculates a bid based on how many hours he estimates the work will take, and multiplies that by his hourly rate. The rate increases or decreases from its baseline depending on the size of the client, and the difficulty of the work involved.

So there's a simple formula for design appraisals:

Difficulty Factor x Hourly rate x Hours of work. Difficulty of the work increases or decreases the hourly rate by up to half. So the possible values for DF range from 0.75 to 1.25, whereby 0.75 is the easiest work possible that results in a reduction by a quarter of the hourly rate. 1.25 is the toughest (Ben's loathed Moveable Type, for instance) resulting in an increase by 25% of the hourly rate.

Simple appraisal, no?

Related articles are archived in the topical categories website appraisals, flipping tips.

Website Appraisals 101: SEO

2006-08-31T14:40:00.000-07:00

Search engines today direct huge traffic around the web, similar to the way traffic police used to stand at intersections and control the flow of cars and pedestrians. Furthermore, traffic from search engine referrals has been repeatedly found to click more ads than traffic from other sources. The point is that an assessment of search engine optimization is key to a website appraisal. If you enjoy this article consider my free newsletter.

As I wrote at City SEO, there are five standard things to consider in reviewing a website's SEO. These factors are backlinks and inbound links, keywords, external links and link structure, content, and finally current SEO effectiveness.

Ultimately, a site SEO review needs to be conducted. Once this is done, a dollar value can be put on the website's SEO strategy. Each factor can be valued individually, but to keep things simple, we prefer to just look at current SEO effectiveness, and replacement costs for SEO.

Current SEO Valuation

Ideally, a website is ranking number one for its targeted keywords. To put a value on this, establish how much revenue is generated from monthly search engine traffic. A good analytics program such as Google Analytics would be handy for this. Then consider what percentage of traffic is being converted, and see if the website is exploiting its SEO effectiveness well.

Other important considerations are how effectively a website turns its SE traffic into repeat viewers, members, newsletter subscribers, etc. The relationship (if any) a site builds with its search engine visitors needs to be evaluated. The earlier site SEO review will be helpful here, because visitors come back for a site's content. Another thing that might help earn bookmarks is a tightly focused keyword strategy. Visitors that see lots of links and material on a particular keyword judge the website a good resource and bookmark it.

Replacement costs of current SEO need to be taken into account. For example, if it would take $5000 worth of SEO work to get a site where it is in the search engines, this needs to be considered. On the other hand, if the work is simple on-site SEO, the appraisal of the SEO work done will be valued less. This is why backlink strategies can cost in the thousands of dollars. They require lots of work, and in particular specialized work the ordinary webmaster probably doesn't have time for.

SEO Appraisal Factors and Numbers

The bulk of an SEO appraisal is really in the replacement costs, with current SEO effectiveness giving a smaller - but still considerable - premium.

Generally speaking, SEO pricing is broken down according to
difficulty of the keywords/market
hours required to provide the SEO service
size of the website/project - correlates to ability to pay
SEO required

Rand at SEOMoz has more on SEO pricing. Note that SEOMoz is an upper range company with respect to pricing, and that not all SEO necessarily costs what they charge.

To provide an objective appraisal of hourly replacement costs, I'm going to reach for an idea I developed in my article on content appraisals. That is, I suggest taking the average of the on-contract SEO's hourly rate and that of an SEO who can provide an equivalent level and quality of service. For example, SEOMoz' services are comparable to those of Bruce Clay, a firm that charges $2000 a month for SEO services. Rand charges $300-$400/hour for his work. Further up the scale, some SEOs (Aaron Wall) charge as much as $500 an hour.

So the low range price of SEO per hour is about $50-$200/hour. The midrange SEO rate per hour is roughly $201-$350/hour. Finally, $351-$500+ is the high end of SEO.

Related articles are archived in the topical categories website appraisals, tips, and the website market.

Domains Domains Domains...

2006-08-23T21:17:00.000-07:00

Domains are a potentially high profit market, which is why they're so atractive to many. I've researched some domains that can potentially be bought and sold easily. (If you enjoy the read, consider my free newsletter.)

Here's the list of finance and business oriented domains I found were availablevia the excellent domain tool, whois.ws:
eurobond.eu
beforetaxprofit.com
daytrading.com
dividendrate.com
equitycollar.com
equityfloor.com
equityoptions.com
equityswap.com
grantor.com

If you do purchase one or more of these domains, in order to flip them, please leave a comment and let me know how it goes, or email me (bookworm.seo at gmail).

Related articles are archived in the topical categories domains and domain names, site flipping case studies, and website markets.

Website Appraisals: Traffic Appraisal

2006-08-17T08:12:00.000-07:00

Appraising traffic is an important part of deciding whether or not to buy a website. (If you enjoy the read, consider my free newsletter. )

Essentially, there are two points about traffic: quantity and quality.

Volume can be measured in sheer unique visits, and in page views.

Quality can be measured by the estimated cost per thousand impressions (CPM) the site's publisher can earn from showing ads to his visitors. Furthermore, if the clickthrough ratios (CTR) on ads, and conversions ratios (CVR) on affiliate programs, and sales of his own merchandise contribute to determining the traffic's quality. Obviously, the higher the CPM, CTR, and conversions/sales, the better the traffic.

To appraise traffic, the following formula is appropriate:

Traffic Appraisal = Volume x [.3CPM + .7CPM X (CTR + CTR/CVR + CVR)]

The .3 and .7 reflect the greater trends in online advertising today. More publishers and owners prefer to use cost-per-click ads (AdSense, YPN) and cost-per-action ads (affiliate) on their sites rather than CPM ads. The numbers in the round brackets are a way of valuing click through rates, click throughs to conversions (to see if traffic is converting once it clicks through), and conversion rates proper.

The difference between CTR and CVR as compared to CTR/CVR is in what is being compared to. CTR and CVR compare to traffic stats, while the CTR/CVR ratio - my own invention - compares conversions to clicks.

Related articles are archived in the topical categories website appraisals,negotiating, website markets.

Business For Sale vs Web Site for Sale

2006-08-10T09:28:00.000-07:00

Surfing the Web today, I found that a "business for sale" generally goes for much more than a "Web site for sale." Naturally, this is of interest to site flippers looking to make the biggest bucks from their site flipping. (If you enjoy the read, consider my free newsletter.)

Google business for sale and you'll find that franchises and other businesses are selling for tens or hundreds of thousands of dollars. By contrast, most established websites for sale at places like Website Auction Hub go for a few hundred to a couple of thousand dollars.

Several thoughts and comments come to mind when I consider this state of affairs in the business and web site world.

First, it raises a traditional question in business planning: will you sell volume or will you sell quality? By volume, I'm referring to micro-businesses, such as websites that generate income in the double digits on a monthly basis. By quality, I mean mostly bricks and mortar businesses that have a high trust factor, and generate income in the hundreds or thousands of dollars monthly.

Second, if people are willing to sell "web sites" much cheaper than they're selling "businesses," the opportunity for the site flipper's wet dream arises. The opportunity can be summarized as follows. Given the differences in pricing between the "web site for sale" market and the "business for sale" market, site flippers can buy on the web site for sale market with the idea of reselling it soon after on the business for sale market.

This is the basic idea behind house flipping: buy a house, and resell it quickly. Except that laws make house flipping illegal (agents can be sued for not getting the best price possible). Chances are, the internet will be regulated like any other industry (domain registries being a good example of some early regulating).

A third issue this raises are the long term prospects for the "web sites for sale" market. Someone is bound to fuse the business- and web site-for-sale markets. When this happens, the law of supply and demand means that web site prices will increase, while business prices will decrease. A new equilibrium will be reached in the market where the above-mentioned opportunity will dissapear. And if the market doesn't take care of it, government will.

Fourth, I wonder if the business for sale market is as succesful at finding buyers for sellers as the website market is. This will affect the equilibrium reached when the two markets merge. It might also prove meaningful to site flippers whose pockets aren't that deep, as selling a business usually entails more costs than selling a web site does. Listing fees alone are 2 times more expensive, at least.

Last, and most importantly, I encourage my fellow Site Flippers to immediately involve themselves with the web site market as deeply as they can. The window of opportunity to profit from the current parallel business for sale and web site for sale markets is shrinking by the minute, as even the mainstream media report the "news" about our industry.

Related articles are archived in the topical categories buying a site, selling a site, flipping tips, and website markets.

Canadian Domains to Register

2006-08-07T13:09:00.000-07:00

I was playing around with some registrars and found some interesting domains that are still available. If you enjoy the read, consider my free newsletter.

Canada's universities: canadasuniversities.com
Canadian parties: canadianparties.com
Canadian exchange rate: canadianxchangerate.com,
-canadiandollarrate.com,
-canadianloonierate.com,
-canadiancurrencyrate.com,
-canadianloonies.com
Canadian Idol: canadianidolatry.com

Let me know what you think, and if you register and/or sell any of them, let me know too.

Related articles are archived in the topical categories buying a site, tips, flipping case studies, and the website market.

2007 Canada Games Domain

2006-08-02T00:03:00.000-07:00

A client of mine is the new, proud owner of http://www.2007canadagames.com. The owner, a friend and client, saw people searching for that, and figured hey, why not go for the domain name. There aren't any development plans as of yet. Either way, the domain has great value: it's the exact name of the games, it's .com, and there's massive interest in the games.

For those who don't know, the 2007 Canada Games are Canada's version of the Olympics, with athletes from across the country competing.

If you enjoy the read, consider my free newsletter.

Related articles are archived in the topical categories buying a site, case studies, news, and the website market.

Dumb & Funny Domains People Have Bought

2006-07-27T16:22:00.000-07:00

When buying your domain, you need to consider how others see it. Here are 10 groups who didn't and the uproariously funny website URLs they're stuck with.

From the Site Flip perspective, I see commercial possibilities here, given the publicity that can be built up by using this sort of thing, not to mention the free backlinks!

Related articles are archived in the topical categories buying a site, case studies, news, and the website market.

Website Appraisals 101: Revenue Appraisal

2006-07-25T09:13:00.000-07:00

Having a good eye for appraising a website is one of the site flipper's essential skills. After appraising a website's content the next most important factor to value is revenue. If you enjoy the read, consider my free newsletter.

Revenue

In traditional business takeover theory, a business' value is estimated in multiples of monthly revenue. The standard multiple, or range of multiples, varies depending on the type of business. This is basic, and simple enough that it needs no more explanation than that.

This leaves us with certain difficulties, however. Firstly, earning revenue is not synonymous with making profits, and secondly, a site's revenue streams aren't taken into account by a simple assessment of revenue.

Revenue vs Profits

Many websites earn a revenue but don't make a profit because costs exceed revenue. (Recall from business 101 that Profit is Revenue minus Costs. P = R-C) A situation where costs are greater than revenue is commonly known as being in the red, or running a deficit. Depending on the website, such a situation presents either humongous potential or a seductive trap. The following are the key issues in differentiating one from the other.

1- Ease of profitization: We've all heard of monetization, but the key issue is really turning a website into a profit generator. To see if turning a profit would be easy, you need to consider monetization opportunities (affiliate programs/advertisers/other revenue generators in the niche), the traffic's demographics (return users vs new, trust factor, disposable income of visitors) SEO, and whatever else could have an impact.

2- Turnaround time to profits: A website flipper conducting a revenue appraisal will look at how long it will take to turn a deficitary situation around. That means two things. First, time the site flipper will put in working on the site. Second, the time span until the website turns a profit. Usually, when a website reaches a certain critical mass of traffic, it can break even. A site with easier profitization will have a faster turnaround time.

Those are the two main factors I know of. If you know of any others, you're welcome to leave a comment.

The point I'm making is that when a website earns revenue but makes no profit, this isn't necessarily a bad thing. Site flippers with an eye for a bargain will seek out websites in the red. This is because their financial situation is inevitably a huge bargaining chip. If the website can be easily profitized with a quick turnaround, well, a good deal has been found (with regards to revenue appraisal; other factors may not make the site worth purchasing).

Sources of Revenue, or Revenue Streams

With respect to sources of revenue, finding out if a website's revenue streams are diverse and sustainable is the main task of a site flipper.

In terms of being varied, the desirable amount of revenue diversity grows proportionally to a business. For example, a small business with a handful of revenue streams can be contented. Any more might cause logistical difficulties, while any less would put the business in an undesirably risky and dependant position.

By contrast, it makes sense for a big company to have several sources of revenue. One of the greatest failures of modern business saw GM's parts manufacturer Delphi be spun off. It only had GM as a client. When GM ran into financial troubles, the Delphi went under. "The former wholly-owned parts unit of General Motors Corp. (down $0.06 to $28.29, Research) said it has been hit by the downturn in fortunes at the world's largest automaker, as well as by its own internal problems."

With particular respect to the website market, I've seen cases of people placing a premium on non-Adsense revenue streams. I personally have no problem with Adsense, but there is obviously a problem with over-reliance on Google's ad platform as a revenue source.

In terms of being sustainable, revenue streams should preferably come from a source independant of outside factors. For example, a website that has been earning money by selling FIFA World Cup soccer balls will oviously have revenues tail off as interest drops post-Cup.

In appraising a website's value, consideration is given to:

multiples of monthly value,
the ease of profitization,
turnaround time,
revenue diversity, and
revenue sustainability.

I've invented a formula to take these factors into account.

Let

Revenue Appraisal Range = RAR
Monthly RevenuE = MR

The lower multiple in the industry's revenue appraisal range = LM
The higher multiple = HM

Ease of Profitization = EP
Turnaround Speed= TS

Revenue Diversity = RD
Revenue Sustainability = RS

RAR = {LM x MR + [(EP + TS) x MR] + [(RD + RS) x MR]} to {HMx MR + [(EP + TS) x MR] + [(RD + RS) x MR]}

This can be simplified. Combining Revenue vs Profits into one factor (e.g. EP + TS become Revenue vs Profits, or RvP), and combining Sources of Revenue into one factor (e.g. RD + RS become Sources of Revenue, or SouR), we get:

RAR = [MR x (LM + RvP + SouR)] to [MR x (HM + RvP + SouR]. Of course, these factors are weighted and adapted as per their importance.

Related articles are archived in the topical categories website appraisals and the website market.

Site Flip Banned Abroad!

2006-07-20T11:28:00.000-07:00

In case you didn't know, Site Flip is such a dangerously subversive blog that India and Pakistan have both banned me from their citizens computers. Apparently, the BBC says I'm not the only one. I'm guessing my City SEO blog is also cut off from the Indian subcontinent. If you enjoy the read, consider my free newsletter.

Here's the commentary I posted over at Earner's Forums.

Why are some blogs blocked? According to the BBC:

A federal government notification of July 2003 says it can ban websites in the interest of:

* sovereignty or integrity of India
* security of the state
* friendly relations with foreign states and public order
* preventing incitement to commissioning of any cognisable offences.

What I find funny, generally, is that Google played along with the censorship game in China, and is now feeling the other end of this.
Wouldn't it be grand for google.in and google.com to be blocked abroad? Let the smarty pants know what it's like to be blacklisted.

Related articles are archived in the topical categories news.

Earner's Forums: Great Resource on Monetization

2006-07-18T22:52:00.000-07:00

Amongst a Site Flipper's core skill set is the ability to monetize a website. Lee Dodd is a forum wunderkind who makes a killing off of websites, and is particularly well regarded as a forum guru. Which is why I sincerely encourage everyone here to go read and join Lee's Earner's forum.

In particular, you should look at the Ask Lee thread in monetization, where he answered my question on how he conducts research :D, amongst others. In fact, it's quickly becoming a popular thread as other gurus join the discussion, and as of this writing, it has been stickied to the top of the forums. Also take a pass at the SEO forums there, of course. If you're smart, like I said above, you'll join Earner's forums.

Consider my free newsletter.

Related articles are archived in the topical categories website home improvement, tips.

10 Tips on Website Buying

2006-07-18T22:16:00.000-07:00

SEOMoz' Egol has 10 tips to share about buying a website. Egol's tips for website purchases tackle things from a combination legalistic/SEO point of view which is quite interesting. Note: If you enjoy the read, consider my free newsletter.

Some of Egol's main points, which really apply to any important business deal. However, I think it's worth noting that much of the legal stuff is only important for big deals. There's no point spending $200/hr on a lawyer if the domain itself costs $100.

In short: Hire a lawyer, use escrow services, make sure you get the deed/title/legal papers cleanly, and buy the domain for its "sexiness," content, and backlinks.

Get the full 10 tips on buying websites over at SEOMoz.

Related articles are archived in the topical categories buying a site, tips.

College Startup Has Been Sold!

2006-07-14T12:23:00.000-07:00

College Startup has been sold. If you enjoy the read, consider my free newsletter.

Site Flipper Ben Bleikamp sold his youth-oriented entrepreneurship and business blog to fellow business blogger David Krug, of Problogging.com. The price: $1400. Nice, huh?

My personal opinion on it is that content-wise, David got a bargain. I appraised the content at a minimum $600-700 value. On the other hand, Ben got a good price revenue-wise, as he hadn't generated a steady stream of revenue on College Startup.

Congratulations to David, the auction winner! Stay tuned to see where he takes College Startup.

Related articles are archived in the topical categories case studies and the website market.

Interview with Blog Flipper Ben Bleikamp

2006-07-11T12:18:00.000-07:00

Ben Bleikamp of College Startup fame is now selling another one of his blogs, College Startup. I sat down with Ben and we had a great chat on flipping websites for a profit. If you enjoy the read, consider my free newsletter.

Ben first came to my attention as a Site Flipper when I read about his sale of The Poker Blog. His method of blog flipping can be summarized as build, write, and generate revenue, then sell for a profit.

Ben and I discussed a variety of things. Amongst others, Ben dicussed his new launching Lovely Blogs project, shared some great insights on what makes a website sticky, and traffic building techniques, and investing in websites by taking out mortgages.

Lovely Blogs is Ben's showcase of nice blog design, which makes sense when you consider that Ben is a succesful blog designer himself. What many people may not know, though, is that Ben is also a marketing genius. "I went from 0 to 100 subscribers since friday evening," Ben told me soon days after launching the project. "In 4 days I've gone from 0 uniques to over 270 a day," he continues. "People love the concept, so far."

This success has surprisingly not involved typical promotion methods. Perhaps it's because of his attention to design, or because they are often ignored, Ben hasn't pursued any blogrolling opportunities with College Startup, and he isn't blogrolling with Lovely Blogs either. Rather, he's pursuing an original backlink strategy.

"I'm not requesting links," Ben tells me. "I hate people that email me like 'hey I linked you, link me back!' So basically I interview a designer, then they are like 'hey check out my interview here,' so the designers are all linking back to me.

The question then is how Ben wants to keep traffic up, after the links from interviewed designers stop sending traffic along. Well, for starters, Ben's website is interactive. There's voting on how pretty a blog is, an integrated blog, and RSS readers obviously mean lots of return traffic as well. More is coming, according to Ben, and based on what he's told me, visitors can expect some great resources.

Finally, Ben and I discussed blog investing. That's a fascinating issue that deserves to be covered on its own, though, so I'll be writing about that tomorrow.

So where is this all heading? I checked back at Lovely Blogs today to find this lovely news: Ben's overwhelmed! There are 500 RSS readers already, and a week after launch, he's logged thousands of uniques! I, for one, have taken note of his traffic-building smarts. Anyone looking at updating a website's design should consider either hiring Ben or some of the designers at Lovely Blogs! Though ... with his marketing smarts, I sincerely doubt he'll need it. Lots of luck to this genius Site Flipper!

Related articles are archived in the topical categories website home improvement, tips, case studies, and the website market.

Yahoo Flips Blo.gs Network. Who knew Yahoo Site Flipped?

2006-07-07T13:44:00.000-07:00

While researching the history of site flipping, I've found that Yahoo! is a player in the industry. If you enjoy the read, consider my free newsletter.

Of course, everyone knows that Yahoo! bought out Del.icio.us in order to use its social bookmarking behavioral stuff in its algorithms. But who knew that Yahoo! had bought out Blo.gs?

The hat-tip goes to Darren Rowse for the tip-off that Blo.gs was for sale. The Problogger also mentioned it was a "renovator's" project, and I disagree with him there. At $2500+ dollars of loss, it obviously wasn't a project for the beginning or independant Site Flipper, which is what felt implied there.

Related articles are archived in the topical categories website appraisals, buying a site, website home improvement, selling a site, negotiating, tips, case studies, news, Site Flip Newsletter, and the website market.

Website Flipping Tips from Real Estate Investors

2006-07-06T22:33:00.000-07:00

I was surfing the Web and I came across a real estate website discussing the opportunities the company was interested in. Many of their buying interests can be translated into tips for website flippers in the Web estate market. If you enjoy the read, consider my free newsletter.

Here are the LargeRealEstate investors's interests:

Properties priced below replacement costs: Well located properties that can be acquired at a price below replacement costs where underlying conditions may be affecting rents.
Neglected Properties: Properties that may have been undermanaged and that require aggressive asset management and possibly moderate capital expenditures.
Properties with rehabilitation potential: Assets in need of physical rehabilitation. Examples would include underperforming properties in good locations that may have not been maintained to remain competitive.
Properties with Expansion Opportunities: Properties that can be acquired with an opportunity to add or build out additional density.
New Development: We seek to take equity or equity like debt positions in both speculative and pre-leased ground-up development projects.

Translating that into the world of website flipping, website bargains are:

Established websites that are priced below what it would cost to rebuild them from scratch: Websites with lots of links and/or part of a good network, priced below replacement costs, and not being monetized to potential.
Neglected websites: Frequency of content updates has been faltering, comment spam is accumulating etc. Design is out of date and cannot handle what the website has developed into.
Websites with awful design: This can be in terms of layout, graphics, usability, "busy-ness", poor SEO, etc. Good links and networking, but the website itself needs repair. (My note: A problem that can be related to neglect.)
Established Websites whose content can be quickly enriched: A website with good bases and richness of content that can easily be expanded. For example, popular music forums can probably add a forum for music video discussions.
New website/blog with pre-existing marketing: A website can leverage the owner's other websites for traffic, links, content, etc. A good example would be Darren Rowse's b5media blog network.

Related articles are archived in the topical categories website appraisals, buying a site, website home improvement, tips, and the website market.

College Startup Blog is For Sale!

2006-07-05T22:18:00.000-07:00

Site Flipper Ben Bleikamp has posted his College Startup blog for sale! If you enjoy the read, consider my free newsletter.

The flipper behind the Poker Blog sale is now selling his small-business blog, College Startup, through SitePoint. The starting bid is $1000 (solely based on design it seems), and the BIN price is $6500.

According to the content appraisal formula posted yesterday, I suggested to ben on Google Chat that he was undervaluing his site's starting bid by anywhere from $600-$700, and depending on the technical quality of the posts and their utility, by possibly as much as $1000.

I'm personally interested in buying the College Startup blog, if only as a great flipping possibility (especially considering that I think it's undervalued). The thing is, I don't know if I can afford that kind of money. I'd prefer to finance the deal and or find some partner to purchase it with.

In the next day or two I'll evaluate the opportunity, appraise C-S, and post a follow-up as to what my plans, if any are.

Related articles are archived in the topical categories website appraisals, buying a site, case studies, news, and the website market.

Website Appraisals 101: Content Appraisals

2006-07-05T12:51:00.000-07:00

Here's a basic how to guide on website appraisals: what factors to consider and what each is worth. If you enjoy the read, consider my free newsletter.

For anyone interested in flipping websites, the appraisal process is one of the most important to master. It will allow the expert appraiser to find a bargain and get the ill-versed to buy a website for a price hugely above its true value. The most important factor in appraising a website is its content.

Other basic factors to consider in any appraisal are revenue, SEO, traffic and design. I'll cover those in future articles.

Content

Content is the first and foremost asset of a website on today's Internet. Nobody will go to a website with no content, so that a website that lacks content may as well not exist. By content I mean anything that people can interact this, including articles (reading), software (downloading) etc.

Consider the Google search for Home, which returns a front page full of newspapers and other content websites.
Consider why anyone would link to a website that had no content?
Consider whether anyone in the world has willfully linked to an "error 404: page not found," webpage.

Content, as you'll see me emphasize on my SEO blog, is king.

The problem is that it is difficult to value content. In part, this is due to the fact that there exists considerable difference between what different publishers will pay for content. Newspapers (here in Canada, at least) pay $150 for a regular length story and $400 for a feature (1000-2000 words). Online publishers such as SitePoint pay $40-100 per feature length article.

I believe that the key valuation points for content are utility, technical quality, time invested, and the hourly cost of production. Allow me to explain what I mean by each of these four factors.

Utility - How helpful/useful is the article? Pillar articles such as guides, how tos, and other feature-type pieces (in the 1000-2000 word range) are usually the most useful. Utility is an assessment of the richness of the information presented.

Technical Quality - Assessing the content based on technical standards, how good is it? For example, if the content in question is text, quality can be judged by how interesting the author makes his subject, his clarity, and other measures. Software can be judged by its ease of use, features, etc.

Time Invested - How long was the creator working on his content? Research, production (e.g. writing, recording, filming, coding etc.), and editing are naturally a part of this, but training of the author places a premium on any time invested, as it was an expert performing the research and so on. This is measured in hours.

Hourly Cost - What could the person reasonably charge for their time? What would it cost per hour to have someone else with the same qualifications produce the same content? High-powered lawyers have been known to charge $500-1000/hour, but you can just as easily have a $100/hour lawyer file a lawsuit for you. Hourly cost is the average of what the person could charge per hour vs what someone else with the same capabilities could charge.

Personally, I would add a factor of plus/minus (+-) 0.7 for utility to another factor of +- 0.6 for technical quality. (I weight utility slightly more heavily because you can wade through a boring text that's information rich, while being fascinated by a useless article, podcast etc. serves no one.)

The sum of Utility and Technical Quality I would multiply by Time Invested. The product of this multiplication would itself be multiplied by the average of the author's hourly cost and the equivalent hourly cost of someone with the same qualifications.

The final mathematical equation looks like this: (+-0.7U +-0.6TQ)(TI)(Avg HC) = Appraisal of a Website's Content, or Content Value.

I know this unit based appraisal system becomes difficult to perform when a website has hundreds or thousands of pages of content (software is actually easier, while music and video are grey zones given differences of personal preference). This problem could be solved using a random sampling method to pick a sample of 10% of the content, and then averaging out the appraisal of that 10%.

Note: These numbers have been picked because I consider that they will give a fair and logical appraisal of a website.

Related articles are archived in the topical categories website appraisals, tips.

3 Necessary WebSite Value Lessons from the Poker Blog Sale

2006-07-03T19:29:00.000-07:00

Ben Bleikamp of College Startup sold his Poker Blog, and his discussion of the Poker Blog's Sale is required reading on site flipping and website valuation. Here are some lessons I learnt and that anyone who wants to work in the site flipping industry should learn too. If you enjoy the read, consider my free newsletter.

Ben is a web entrepreneur who is in fact one of the inspirations for Site Flip. When he sold the Poker Blog, Ben wrote about the three basic tasks involved in site flipping. While we differ on the terminology, Ben makes the point that you need to "build it," then go about "pricing your website" and finally "selling your website."

Lessons on growing a website's value.

Ben notes three principal valuation factors for a website. I entirely agree upon their importance, though I would include revenue in there (and the Poker Blog's buyer did indeed consider the blog's monthly revenue). The first factor is content. The second factor is PageRank/backlinks, and the third factor is traffic.

Lesson one - In building a website to flip it, work first of all on its greatest asset: content.

Businesswise, content is a website's greatest asset because it can usually be developed with the sole cost of time. At the other end of things, content can be used for all sorts of profitable ends, such as generating traffic, backlinks, interest from advertisers, trust from customers, sales etc... Content includes text, audio, and video, but the real meaning of content is anything interactive. When a website offers downloads, there is an interaction going on. Arcade websites (those offering original games, anyways), have an incredible content value because of the high level of interaction going on.

Ultimately, content is an asset like machinery and real estate. Actually, it's an asset far greater than machinery and real estate, because of its cost-effective nature and great cost-benefit involvement.

Lesson two - Once your site has a fair amount of content, it's time to market it, and SEO is King with regards to marketing.

Developing a Search Engine Optimization (SEO) strategy that gains high search engine rankings is an essential part of this. The fact of the matter is that everyone in the website market nowadays is at least vaguely familiar with the importance of ranking well in search engines. (Namely that the traffic the engines direct will result in sales, advertising revenues, etc.)

The effect is that a dollar premium is accorded to websites that rank well. As Ben writes at College Startup: "[A proper SEO strategy] will also help add value when you're selling it [your website]. People like to see a site with a PR4 [PageRank 4; PageRank is an indicator of the importance Google attributes a site] or higher, it lets them know the site is established and has a nice number of links coming back to it." While it's technically possible to gain PageRank with few backlinks, Ben's point is generally well taken.

The point here is that as opposed to advertising-based marketing, search engine optimization (or search engine marketing as it is sometime called in reference to its broad application) provides lasting value to a website. Backlinks once earned are generally there to stay. With them PageRank is generally there to stay. (PageRank is also a function of content, which again reinforces Lesson 1 above.) For this reason, paying an SEO specialist such as myself to develop your website's SEO strategy is the equivalent of buying an asset.

Lesson Three - Traffic comes third after content and SEO.

When the content and SEO are in place, backlinks and search engines will send traffic your way. There will be no need to "buy traffic," or to buy "expired domains for the traffic," as a few of the less reputable practices on the web suggest.

Traffic on the web is like the saying: if you build it, they will come. Get the content in place, take care of the SEO, and people will be coming to your website in no time.

Note: This is a lesson that I learnt from Ben; he didn't write this explicitly.

Related articles are archived in the topical categories website appraisals, website home improvement, tips, case studies.

About the Site Flip Newsletter

2006-06-27T00:05:00.000-07:00

My newsletter's tips teach you site flipping twice a month, plus share privileged info on website deals!

The Site Flip newsletter saves you time by bringing you the latest in website buying, flipping and selling. You'll get the tips mentioned above, and better yet, you can self-promote your hot deals through the newsletter! Once you're subscribed, reply to the first newsletter issue you get and tell me about the sites you're selling. Pitch it to me and let me know why it's great.

I manually review submissions, and if you've got a genuine hot deal, all the other subscribers will hear about it!

All you need to do is join and check your email. There's no need to detour to the site unless you're sure you want to read something in its entirety.

Frequency:
It is sent out approximately every two weeks, both to ensure quality and avoid spamming your inbox.

Contents:
The newsletter contains:
- summaries of my best recent material, such as tips, research and important news;
- upcoming interviews and content;
- case studies;
- the latest updates to the site to improve your experience;
- ways you can give me feedback and improve the site;
- miscellaneous ideas.

So first you'll learn the theory. Then you'll see how it's done in real life. And finally you'll get the news so your knowledge stays current. At the end of the day, this newsletter helps you make more money online. Which is what you want, right?

How to subscribe:
Enter your email in the box on the right. You will then be sent a verification email. Clicking on the link in the email will verify you wanted the subscription. This verification process prevents other people signing you up, since they can't access your email to verify the subscription.

Important Note: Depending on your email's spam settings, the verification email may be filtered into your junk mail folder. If that is the case, clicking the link probably won't work. If that's the case, highlight the link with your mouse, and copy-paste it into the address bar at the top middle of your browser window, then hit enter.

Privacy:
Your information isn't shared, sold or otherwise distributed to third parties.

So go ahead: take 30 seconds to subscribe to my free newsletter. Get free tips and find the best deals!

Related articles are archived in the topical categories Site Flip news, newsletter.

Smart Buyers Taking Advantage of Less Experienced

2006-06-26T23:46:00.000-07:00

From Earner Forums comes a story of someone who nearly got bought ought before he realized his potential buyer was a shark.

"About a month ago, someone emailed and inquired about one of my very (and I mean very) small sites. I have put so little effort into this site.

Anyway, he just asked if I would consider selling it. (which I had not ever considered before)

I didn't reply, but then got curious. He wanted the entire site. As is. (keeping in mind it's just a small site with only about 45 articles on it and a vbulletin with under 500 members)

With not ever experiencing this, I asked how he wanted to proceed. Did he want appraisal? traffic stats? revenue?

He replied he didn't want to insult me with offering too little, so to tell him what I wanted for it and to send along the stats.

Then I googled his name and was surprised to find out who he was and felt terribly naive. Like ok, I'm in over my head lately. You know..they know the game better than I do, but I'm not entirely stupid either."

What would you consider in that situation? Would you have been smart enough to Google the buyer? Do you think experienced buyers take advantage of the newer people?

Related articles are archived in the topical categories case studies, the website market.

Website Marketplaces Directory

2006-06-23T18:53:00.000-07:00

To flip a site, it's useful to have a website marketplace directory, that is, to know of all the places you can list a website for sale. So I made a directory of website marketplaces.

I've tried to order the markets listed according to the places I know and trust, or at least trust to some extent. I'm still learning how to flip websites, so please don't take my word for absolute truth, think critically and find the best solution for your particular website. A few sites were left out because they looked like scams. This website marketplace directory has a few sites listed that aren't hugely reputable, but still looked legitimate in the sense that their sellers would deliver a website that was promised without taking advantage of a buyer (too much). I take no responsibility, legal or otherwise, for your use of this directory of the markets listed.

If you know of any markets for buying and selling websites that I missed, post a comment and I'll add it to the list. If you can point to some reputable sites that vouch for the market, I'll even place it somewhat high in the list!

Markets that allow you to buy and sell more than just websites may occasionally be referred to as malls or shopping centers.

Anyways, here the website marketplace directory:

Sitepoint's Website Marketplace - Costs 10-20$ to sell a website or domain. There are markets for other website-related things (design, coding etc.) too.

UK Website for Sale - Includes a helpful section on website appraisals. An appraisal is an estimate of something's value. They also have a US page. The catch is that listing prices are relatively high: 59$ for two weeks! They argue that Alexa rates them as the most visited "website for sale marketplace," though I haven't verified the claim (not because I'm lazy; I just don't know how). Domains can also be listed for sale for 10$, which seems, again, high compared to the competition.

Website Auction Hub - I know the owner personally and am helping him out with SEO. The place is trustworthy, if a bit small. The listings are free, so it is a good place to gain a backlink or two, if nothing else.

Search Engine Forums' Site Market - Part of a search engine forum community, with lots of threads, free listings, and a useful post on the forum about listing websites for sale in forum marketplaces. (You should know that I'm a little biased towards trusting forum communities though, and SEO communities in particular, as I'm an SEO specialist myself.)

Ebizstore.net wants you to sell them your websites - Their interest is in sites with PageRank 4 or better, good, original content, and have a preference for older sites and sites that are US based. No interest in porn or gambling sites.

Website Broker - Free listings, clean looking website.

Hot Websites For Sale - Offers buyers and sellers the ability to buy or sell websites for free. The tips, while being basic stuff most people know, seem to suggest it's a legitimate site.

Creabiz market/mall - Variety of markets, including complete sites, databases (that's where they got my email!! just kidding, of course) and regular business opportunities. Offers free 90 day trials, paid advanced memberships.

Sedo.com Domain Market Apparently, there are 4 million domains listed for sale here. They also allow you to sell developed websites, and provide domain appraisals for a price. They don't charge a listing price, but rather take a 10% commission, with a minimum 50$ for everyday .com, .org type domains, escalating to 100$ for domains like .co.uk, and to 150$ for domains with odd endings.

eBay Website Auctions - Listed lower down because, while I trust the site and have used it to purchase music instruments before, some of the sites look shady. By the way, as a tip, look out for that; people selling 10K$/month revenue websites is too good to be true.

Our Town Center is the market for Women's websites and domains. The SEO could be better, considering the site uses links with anchor text like "here." An interesting concept at any rate.

Daniweb Webmaster Market - Registration is free; I couldn't tell if the listings are. Webmaster shopping center.

Domain Forte is ... a developed website marketplace! - Tiny place, simple, quiet. "Listing cost starts at $10.00 for a single 180-day listing and goes as low as $5.00 for multiple listings."

Time 2 Sell - Offers buying of expired domains, an annoying search feature for listings that isn't simple to use and that seems aimed at artifically increasing page views, and amazon ads. Hard to say spefically what bothers me, but it doesn't rank highly in my humble opinion. The one site with nice potential I saw had irrelevant link partners that were susceptible to having it penalized by Google (Like I said above, I'm an SEO specialist.)

Website Buy Sell - Don't know much about it, looks useful. Free listings, few replies... I like the idea of offering tips articles, but their SEO advice is mostly garbage that is dangerous to your site's health. For instance, they suggest you list with Free For All websites, while Google in fact says not to use link farms, as they will consider you a spammer in that case. Sketchy place...

Update: here's another listing for this website marketplace directory.

Website Lot - List your site for sale for a cost of 10 bucks.

Update: Performancing.com has just created a blog exchange/market! You can buy and sell blogs, and of course, bloggers are for hire, along with other services.

Related articles are archived in the topical categories: website markets, website appraisal, selling sites, buying sites.

Welcome To the Newsletter!

2006-06-23T17:08:00.000-07:00

Thanks for subscribing to the Site Flip newsletter!

Until you get your first newsletter, why don't you pick some reading from our archives? Just click one of the links below.
Articles are archived in the topical categories

website appraisals

buying a site

website home improvement

selling a site

negotiating

tips

case studies

newsletter

Site Flip News

website markets

Site Flip - Flipping Archives

2006-06-22T19:31:00.000-07:00

Site Flip's topical archives allow you to see all the posts on a particular topic. If you enjoy the reading, consider our free newsletter, with the latest tips, news and research on buying, fixing and selling websites - flipping.

To date, the topical categories in existence are:

Site Flip - Flipping Sites, Blogs, Web Estate

2006-06-22T18:51:00.000-07:00

Site Flip is about flipping websites, flipping blogs and generally flipping any internet real estate or "web estate." The idea is to build a website and resell it soon after for a profit, or alternately to buy an established website that is underperforming, fix it up, and sell it for a profit.