What are Flippa scams and how can you avoid them? Keep reading or watch the video to find out.
How do you know if a website owner is lying? There are many signs but the best way to figure it out is to verify everything they are saying independently and on your own.
My Experience with Flippa Scams & Good Sites
In this article I’ll go into my experiences with Flippa, both good, bad, and the scams I’ve encountered and give you insight into how you can avoid scammy Flippa listings and make good site purchase decisions.
I have fallen victim to one Flippa scam, as well as made one poor purchase on Flippa that wasn’t a scam simply a bad investing decision on my part.
The other sites I have purchased on Flippa have been great purchases that I’ve made many times back what I paid for them and many more times what I lost in the scam and poor purchase.
I want to clarify that the Flippa platform itself is not a scam, but like any platform or any activity where money is changing hands, there are some people who will try to take advantage of others and not represent their sites accurately in order to do so.
The only reason I’ve been able to make a handful of good purchases on Flippa is that I had the experience first with buying a site that was represented untruthfully and was a scam, because that firsthand experience made me realize how important it is to dive deep into site stats and revenue and verify everything before making a purchase.
It all started when I received an email from a Nigerian prince telling me I needed to buy him a specific website on Flippa so he could regain access to his bank account and send me a million dollars. Of course I went right away to Flippa and purchased the site so the prince could regain his bank account access and send me a million dollars!
Guys I’m kidding – but on another note don’t give your bank details to any Nigerian princes who email you.
How I Fell for a Flippa Scam
I fell for a Flippa scam on my first Flippa purchase due to a number of factors, and one was desperation and feeling the need to purchase a site that would start making money right away, similar to people who fall for Nigerian prince emails, they are likely desperate for money so they look past the obvious red flags and wire the prince money or do other not super smart things.
Even though I would never fall for a Nigerian prince type scam even in a desperate state, my desperation put me in a poor place to be making any type of buying decision, but I didn’t realize that at the time.
When making that first purchase I scrolled through pages of listings on Flippa and ended up buying a small $1,300 that compared technology and iPad case coverings monetized with amazon affiliates site, and the owner claimed it was making $350 profit a month, so I thought oh this is an incredible deal I’ll be able to make back what I paid for the site in less than 4 months, this is great! The owner even showed me revenue screenshots from his amazon account that showed over $300 each month in affiliate commission, and I had Google analytics access to the site before buying it.
I remember my gut telling me right away there was a red flag. When I looked at the amazon affiliate screenshots, the majority of the purchases were not technology related, they were bible or other related, and the thing about amazon is they pay affiliate commission on all purchases someone makes after clicking your link, not just the direct purchase of the item you inspired them to purchase. This means logically there could have been a lot of other non-related commissions being received.
But I had a feeling there was something off, but I ignored it out of desperation to buy a site that was making money. And I told myself, worst case scenario it has to be making something.
At this point I’d never evaluated a site to determine how much it is currently making and what its potential is via google analytics so I saw it had over a thousand visits a month and thought maybe it just had a very high conversion rate etc, I wasn’t diving deep to verify things and I was way too trusting.
Another red flag was he was selling it for a 4X monthly profit valuation and I knew that the going rate for sites at this point in time was 20X monthly profit valuation, another “too good to be true” signal.
I put in my offer and bought the site and transferred it into my hosting account. I remember getting the first affiliate commission from it for a few dollars and how excited I was. And then there were crickets.
I realized pretty quickly he had lied about the site profit and revenue and that id fallen for a scam.
The site was only making around $20 a month, and he had said it was making $350. Turns out I had paid a 65X monthly profit valuation multiple, and had been lied to about site revenue.
I reached out to him and he never responded of course, and to Flippa to report his account, and they were able to take action, but I had been lied to and had fallen for one of the many Flippa scammers who try to lie about revenue to sell sites for a lot more than they’re worth.
Looking back it ended up being a great first lesson for me because I’d only lost a small amount of money to learn such an important lesson that has likely saved me from losing tens of thousands I could have lost if I’d made that mistake on a bigger site purchase.
How to Avoid Flippa Scams
The lesson I learned is, if you’re buying any type of investment, including a website, you need to go deep to verify revenue and stats and make sure the seller is honest and telling the truth and that your investment is not based on lies or a scam. You need to deep dive into traffic and revenue verification logically to make sure everything checks out. You also need to listen to you intuition and gut which will also give you clues if something is off or ifyou’re falling for a scam.
I also now use something common sense test to determine if stats add up with what the site owner is saying they actually get for revenue.
In the common sense test I combine Google Analytics, average RPMs and conversion rates to determine what the income numbers should be if the site owner is telling the truth. Then I compare the common sense estimates to the numbers the site owner provides and see if they are in the same ballpark.
Learn from my blind trust mistake and always verify traffic and revenue before purchasing a site.
Not everyone is an honest fairy God-mother and some people will try to cheat you out of your money.
You also need to listen to your gut if it’s telling you there’s a mismatch, like in my example where a technology site was getting its main revenue source from bible affiliate products and when a site is only getting 28 visitors a day but the owner tells you it’s making $350 a month Which doesn’t past any type of gut or common sense test or even logical test if you site down and work the numbers out and truly think about it.
What you need to realize is there will always be people trying to lie to get more money, yes on Flippa, and yes even when you’re buying a house or buying any type of business or even product.
People lie if they can get away with it. So you need to assume that is the case up front and go deep to verify everything on your own before making a purchase to avoid falling for any type of scam.
The other lesson I took away from falling for this site purchase is to only buy a site when you are calm and have a clear, non-desperate mindset. It’s similar to making a decision when you’re angry, or texting someone when you’re drunk or angry. None of those actions will end well. You should only make a big decision or purchase when you’re in a good, clear state of mind.
It’s also important to listen to your gut even after verifying everything with logic. If something feels off, it probably is, and your gut is a lot smarter than you give it credit for, so if everything checks out on the verification end but you still feel something is off, then my advice would be to not buy the website.
In this case, even though I was a website buying newbie and had no idea even how to verify revenue or what a site getting 28 visitors a day in the tech affiliate niche should be making, if I had listened to my intuition that was screaming red flags I wouldn’t have made the purchase.
However, only listening to your gut can only get you so far, you need to have a handle on revenue verification if you’re buying a website, no matter how good your intuition is.
This website wasn’t using any of Flippa’s verification features which help weed out scam sites and include google analytics verification and google Adsense revenue verification, and I now only even consider sites on the platform that have these two features enabled, so I can weed out fake sites sooner to only dive deep into ones that already have basic traffic and ad revenue verification enabled.
Is Flippa a scam?
The main takeaway here is that Flippa is not a scam, they are simply a platform where anyone can list a site for sale.
The lesson is to not take anything a seller says at face value. you need to dive super deep into analytics, traffic, revenue, costs and every facet of the site, getting details on every level until you have proof that the site has the traffic and profit that the site owner says it does.
On Flippa and in life, it is your responsibility to look deeper than face value to avoid scams and make informed decisions and purchases.
Have any of you fallen for a scam on Flippa or anywhere else? Let me know in the comments and I’d love to hear your story and reply!