How To Properly Buy Out A Website

Posted in Internet

I’ve bought out many websites in the past. Some purchases have proved to be worthwhile, while others turned out pretty raw. In the end, my results really came down to how much I was prepared for what the site had to offer, and what my expectations for the future were before I bought out the site. Knowing what you are getting yourself involved in ahead of time is half of the game; having the patience to improve upon the site and recover the cost you had to pay to buy it out is the other half. Here’s a brief list of things to look out for before you spend your hard-earned bones on something that could be your next nightmare:

1. Don’t catch the falling knife - obviously, I like to use this phrase. Take a look at graphs of the website’s statistics. Check out third-party statistics as well; never put your full confidence in what the seller has to say about his/her own website. Alexa.com offers good generalizations of traffic/reach over time. You want to buy the site that is on the up and up, not the site that’s heading towards the gutter.

Many webmasters tend to think they have the “magic skills” that will heal a failing website. Sure, it’s possible, but more likely than not, the site will continue to grow/fall apart in the direction it was going before you got your hands on it. Websites are not like stocks: what goes up will not necessarily come down, and what goes down will definitely not come back up unless you have some sort of plan that will bring it back to the limelight.

2. Expect downtime - when buying out an established site, a lot can go wrong. If you are transferring over a site that takes up 20+ GBs of webspace, and collects thousands of unique views a day, you’re going to find yourself depressed in the corner of an inner-city bar, drinking the night away, if you don’t prepare yourself for the worst. DNS/nameserver transfers take 24-72 hours to fully propagate all over the web. This means at least a day or two of downtime, which will definitely take a chunk out of your traffic once the changeover is complete. Let your visitors know that there’s going to be downtime. Surprising them makes them think you’ve either got hacked, taken down by the FBI, or fell off the face of the planet.

Visitors tend to lose interest fast. When you’re down, they find something else to do, and when they find something else to do, they forget to come back to your site. Furthermore, a day or two of downtime could affect your search rankings, and could also tick off some advertisers (esp. if it’s a larger website with direct ad sales). Make sure you have multiple backups of the databases and site stored locally as well.  Sometimes, things can really go wrong and files become corrupted beyond all recognition.  Better safe then sorry.

3. Know the topic at hand - do not buy a website that you don’t have expertise in. Don’t buy a site that has to do about taking care of cats if you’ve never owned a cat in your entire life. Likewise, don’t buy a site about advanced SEO techniques if you barely know how to edit the .htaccess file on your webserver. Buy a site that you’re interested in, because when it comes down to it, you’re the one who’s going to have to deal with it every single day till the end of time (or when you sell it).

4. Make friends with the visitors - dedicated visitors tend to dislike site takeovers. The reason why they usually visit a site is because they like how things are going. When you buy out a site, you’re changing things up. And society doesn’t like change. Unless you plan to hire the owner and his staff to continue the maintenance of the site, a lot of things are going to be different. And people will notice, so don’t try and hide it. If anything, make it clear that you’ve bought out the site. Don’t make it too corporate-feeling though, you don’t want to scare off habitual visitors. Make it something smooth, like “Johnny is going to college now, so I’m going to run the site for a bit, but he’s going to continue to give me advice on how to run it for you all”. Corny example, yes, but make up something along those lines.

5. Don’t pay too much - generally, my formula for a website’s value is 10 to 18 times the website’s monthly income. However, there are a lot of other factors which should affect your pitch to the owner. If the site is unique (in design, coding, topic), you should offer more. If the site is just a run-off-the-mill forum site, or anything else based off a publicly available CMS, offer less. Your pitch should reflect the amount of effort the owner put into developing the site. Also, adjust your offer to reflect the site’s growth potential. A site that is niched and hard to expand is worth considerably less than a site which has the potential to attract millions of users.