Have you ever seen the movie “Pretty Woman?” It’s the one with Julia Roberts and Richard Gear. My wife was watching it the other night and it got me thinking about website flipping.
If you’ve seen it, you’ll remember that Richard Gear plays a billionaire business takeover guy that preys upon struggling businesses, buys them out, and sells them off piece by piece to other companies.
In today’s post, I want to talk about doing the exact same thing when it comes to websites and group auctions. Let’s call this a Piece by Piece Website Flip.
One type of auction I see passed over by so many people in online marketplaces is the “group of 250 adsense sites” type auctions. Usually, there’s 1 or 2 sites in the bunch that make up the majority of the claimed income, and the owner is throwing in his collection to inflate the perceived value.
If you’re like most people, you don’t even give these auctions a serious look. I mean, who wants to pay to renew 250+ domains every year?! Who wants to go through with the hassle of transfering 250 sites to a different hosting account?
Sometimes, if you’re lucky, you can get the owner to sell you just one of the sites in the bunch, but more often than not they aren’t willing to separate the wheat from the chaff for fear of not being able to sell the chaff.
So, what’s a website flipper to do? Become Richard Gear!
When I see these types of auctions, I like to take a look at each site to sniff out ANY potential value in them. Even if the sites have zero traffic or revenue, the domains, content, and designs may be worth something. Even if only $25-$50 each.
Lets use the above example. You go to Flippa.com, and come across a listing that says “Network of 250 Adsense Sites for Sale”. The network of sites collectively earn about $350 per month, and over $300 of that is from less than 5 sites that are the real winners in the group.
The BIN is $3,000.
Also, the seller is absolutely UNWILLING to sell you the 5 money makers by themselves. They want you to take the whole bunch of them, or nothing at all.
After browsing through the 245 duds, you see that most of them have 5-10 quality original articles on them. They each have a decent looking design with a unique header graphic. In fact, the only reason they don’t make any money, is lack of traffic and ad placements.
So, with the domain names, site designs, and original content, you figure each site is worth about $30 to you.
You quickly place the BIN for $3,000, (primarily for the $350/month in adsense income from the main 5 producing sites), and you devise a plan for extracting that $30 per site from the rest of them.
Instead of being blindly optimistic, we’ll assume that we can only successfully extract that $30 per site from about 40% of them. So 40% of 245 sites = 98.
The plan is twofold:
1.) List the sites at eBay, digital point, and other cheap marketplaces where these types of sites will sell for $30 without much cost to you.
2.) Create a special offer at Warrior Forum or to your own marketing list to create “unique, high quality adsense sites with 5 + articles, graphics, & domains for $30 each”.
Between these two strategies, you successfully sell 98 sites times $30 for a cool profit of $2,940.
Your new income stream has paid for itself, and you still have 147 sites you can use for link building or whatever you want.
Perhaps this will give you a new perspective on monetizing auctions you normally wouldn’t give a second thought to.
Have you ever done a “piece by piece” flip? Have you ever broken down the assets of a larger site and sold them off piece by piece to other people? Better yet, have you ever bought a business and sold off chunks of ownership to 2 or more parties to recoup the initial spend?
Comment below with your thoughts on Richard Gear, piece by piece website flipping. We’d love to hear your thoughts.