You’ve come to the conclusion that it’s time to sell your online business. The thought of transitioning all assets, accounts, and other related facets may sound daunting, however this article will give you insight to the selling process, whether you choose to go the private party route or use a broker.
Selling My First Online Business Online
In 2018 I had my first experience with online business selling. At the time, I owned a technology review website that received strong organic traffic and that was monetized through affiliate offerings and advertisements.
Favorable timing triggered my decision to sell as the website was generating stable profit while other investment opportunities presented themselves. The decision to sell proved to be correct, as this gave me time to reflect and analyze my next venture.
I highly encourage anyone that is feeling burnt out or that is no longer passionate about their business to consider selling and taking a short break.
Additionally, selling on the high is also not a bad strategy. Depending on your market and niche, there may be willing buyers to pay top dollar for your hard work.
Had I not sold my business online, I would not have the opportunity to write this article or work on other projects that excite me each day.
How To Sell Your Business Online
There’s two ways you can go about selling your online business, the first is selling private party and the other is going through a broker. Let’s break these options down and identify which may be the correct fit for your situation. I believe there is a time and place for both options.
Private Party Sale
As stated in the name, a private party sale occurs when a buyer and seller do a transaction without any involvement from a 3rd party broker. There are numerous business buying and selling Facebook groups that can help facilitate a private party transactions. There are even email newsletters dedicated to this.
I’ve personally had success cold emailing website owners to see if they would be interested in buying or selling.
Depending on your business, price, and other factors, it may be easy to find an interested party. However, this is where things can get challenging. First, many people are non committal, asking lots of questions and taking up your time with little purchase intent.
Once a serious buyer has been vetted and an offer has been made, the negations begin to take place. Depending on the size of the deal, it may not be a straight cash purchase, rather some cash up front with an earn out over time. The type of business and valuation can increase the complexity of the deal structure.
If you do plan to go the private party route, I recommend using Escrow.com to handle the payment disbursements. I’ve personally ran over $100k through Escrow with no issues, and their system shows complete transparency for both parties.
In the event an earn out is agreed upon, the actual monthly payment can get tricky. In Escrow, the max transaction can last up to 28 days, which would not give sufficient time for an earn out. So setting up a second escrow with a bank may be needed to ensure safe fulfillment of the terms.
Once a purchase and sale agreement has been signed, and funds have been deposited into escrow, the actual migration begins.
With regards to an online business, the main components include the domain, the actual website database (including content), and the monetization streams.
I’ve heard stories in the past of people only transferring the domain name from the seller to the buyer, thinking they are done. That is just one piece of the migration process.
Doing a domain transfer is fairly straightforward, however the complexity increases once the actual website content and files need to be moved to the buyers hosting account. Using a FTP system is typically the best way to do this.
Don’t forget to change the nameservers once the domain transfer is complete!
Lastly, ensuring that the business continues to earn revenue is crucial. Depending on the monetization methods, affiliate and ad accounts may be able to be transferred, while others will need to be opened in the buyers name.
For newly established accounts, the tracking links will need to be switched out by the buyer to ensure they receive the conversions.
There are other migration intricacies such as Google Analytics, Search Console, social accounts, email accounts, and etc that also need to be moved into the buyers control.
When To Do A Private Party Transaction
I would, and have done, private party online business transactions when the deal is under approximately $30,000, and has few assets attached to it. Purchasing a website with thousands of articles each containing affiliate links will lead to days of painstaking link updating, for example.
Using A Business Broker
Using a broker to represent you as the seller of your online business can prove beneficial in a variety of ways. When using a broker, they do a majority of the “heavy lifting” that comes with a business sale. As we’ve already outlined above, there are many crucial steps with digital asset transactions, and leaving these steps to professionals can not only put more money in your pocket but also free up your time and reduce liability.
The broker that I’ve always used is Empire Flippers. I’ve done six figures worth of deals with them, and the results have been stellar. I’ve used them to represent me as a seller several times, and as a buyer. Although brokers charge a selling commission, I’m a firm believer that the value reputable brokers bring is well worth the commission. Plus often times a broker can get more for a business, meaning the commission is covered.
Additionally, I started Money Nomad Marketplace in early 2020 which is tailored to representing the underserved market of digital assets worth $5,000 to $30,000. Empire Flippers serves the market for online business valued at more than $30k. Let’s break down how a broker can be helpful and when I suggest to use one.
Do you own a content website, FBA business, SaaS company, ad website, or some similar online business?
Now might be a great time for you to get top dollar for your digital asset.
If a broker is representing you as a seller, they have a fiduciary duty to protect your best interests and your financial wellbeing.
As mentioned above, deal structure complexity increases with the size of the transaction. Brokers have negotiated nearly every possible deal structure in the past, and can lean on their past results to recommend and finalize even the most complex deals.
A reputable broker has a large database of buyers, which can often times lead to a very quick sale. For example, when I sold my tech review website with Empire Flippers I had an offer within 12 hours and an accepted offer in less than 36 hours.
Getting your business into escrow as quickly as possible is important, since the future is never certain. A dollar today is worth more than a dollar tomorrow.
When using a broker, funds are secured through their escrow accounts run by their own terms. There is no 3rd party escrow company involvement. This means if a payout is part of the deal, the broker can easily distribute funds each month, while holding the domain in escrow, so both parties know they are covered.
Another area that a broker is worth their weight in gold is in the migration process. As mentioned above, there are many moving parts that require technological know who in order to successfully migrate an online business.
Brokers do website migrations several times per week, and have the system and team in place to make for a seamless transition. So much can go wrong with a domain transfer and file migration, it’s safer to leave this to the expects, especially for businesses that can’t suffer a few hours or days of downtime in the event of an issue.
Most brokers are also responsible for migrating all of the monetization accounts and links to the buyer, which would take most people days. A buyer simply logs into their new accounts and the revenue is already flowing.
When To Use A Business Broker
I’d recommend using a business broker when the business is worth >$30,000 and has numerous monetization methods, and if the seller is looking for a hassle free process that puts their fiduciary needs as a top priority.
Listings Of Online Businesses For Sale
Below is a list of reputable online business brokers that currently have businesses and websites for sale. These listings can range from $30,000 to over $10 million and spread over all market sectors. Most website brokers represent a large range of internet business models including content websites, niche websites, SaaS business, Amazon FBA businesses, e-commerce stores, lead gen websites, plus much more.
- Empire Flippers – They typically charge a $297 vetting fee for business submissions, but click the button below to pay no vetting fee
Whether you decide to sell your website private party or through a broker, just know you’re taking the first step to opening more doors for your future. Through personal experience I can attest that both selling avenues have advantages and drawbacks. Analyze your available time and skillsets to see which option suits your needs best. If I can help in any way shoot me an email firstname.lastname@example.org.