If you’re buying a website at one of the online marketplaces, such as Flippa.com, you might find the following information useful.
The gavel has fallen, you’re the highest bidder … so where do you go from here? As the heady flush of winning fades, finalizing your first deal can be a confusing process and one with plenty of stumbling blocks for the unwary. Even for the experienced buyer, there are often new twists and turns that we don’t discover until we’re all but ready to ink the deal. Here are a few tips and pointers to help you along your way.
First, you want to make sure that your due diligence is completed and accurate. Ideally, you should have accomplished this prior to having placed a bid, but in the excitement of the auction this isn’t always possible. Have you verified earnings and traffic stats? Will the seller agree to use an escrow service? Have you researched whether there are any intellectual property concerns with the content, products, or domain name associated with the site you’re buying? If you have not ascertained them already, these are points you’ll want to cover immediately.
Shortly after the auction ends, you should hear from the seller. He or she will likely ask about arrangements for the money to change hands. I am a big proponent of escrow services. For buying the small to medium web sites we deal with in SitePoint’s Marketplace, there are three services I recommend, Escrow.com, Sedo.com, and Moniker.com. I prefer them in the order in which I’ve listed them here, but you should check them all out and determine which suits you best. I’ve saved myself from a scammer by the mere mention of using escrow on more than one occasion in the past. Scammers hate escrow. It’s not foolproof, but it will at least ensure that you receive ownership of the domain name before the seller receives the cash.
The next part of the process will be taking possession of the domain. You can find out where the domain is registered by doing a quick whois search on the domain. I use DomainTools.com for my whois searches, but there are hundreds of other sites that provide this service. It’s easiest if you have an account at the same registrar where the domain is currently registered. Transferring ownership from one registrar to another is a slow process, and quirky enough for a high percentage of attempted transfers not to finish it off on the first try. Almost all registrars, however, make it very simple for customers to send a domain into another customer’s account. Once you have control of the domain, and it resides in your own account at the registrar, you can proceed to transfer it out to the registrar of your choice. The only caveat here is to make sure the registrar where the domain is currently held is a mainstream registrar.
Moving the site itself comes next. This stage can vary from a dead simple undertaking to a massive one. Some of the web sites I buy are accompanied by multi-gigabit databases. Those are never fun to move. And they’re especially not fun when you’re dealing with a membership that is unhappy about the web site changing hands in the first place. Sometimes it helps if you can arrange to have the seller help you with the move; they may let you host on their server for a temporary period while you become accustomed to the functioning of the site, or simply take over their server along with the web site.
While it’s impossible to anticipate every situation, taking the time before placing your bid to make a plan of what to do if you win the site will help you determine whether the deal is a good fit for you. Be sure to get your questions in up front, and quickly–while you’re asking questions, more experienced buyers are putting in their bids!
I originally wrote this for the SitePoint Market Watch Newsletter.