Buyers beware! There are many webmasters on the web looking to make a quick dollar by flipping their websites. They build sites within a matter of weeks, drive traffic to the site within a matter of months & make a few dollars after the first year. They then turn to “investors” to buy in to the great opportunity they have for sale. On the surface, the website seems like it can make money and provide a return, but any keen buyer needs to do proper due diligence to uncover any holes in the offering. If a website has only been turning a profit for a couple of months, there are some key items to look out for to determine if the investment seems plausible.
See if the website has the potential to be profitable over a prolonged period of time.This can be done by asking a few simple questions to the seller. Where is the traffic coming from? Is the money being made from the sale of product? Ad revenue? Is it a subscription service? Is it a website based on a fad?
Every website that is offered up for sale will have different questions that will need to be asked, but just be sure to ask as many as possible. At the end of the day, if the seller wants to sell the website, they will provide the buyer with as much information as possible. So ask away!
In a proper due diligence period, one must not only look at the financial feasibility of the website investment. It is very important to uncover EVERYTHING about the site. How long has it been running for? What are the growth opportunities available? Who are the competitors? What are the competitive advantages of the website? Is there any contracted labor? What type of marketing is being done?

As professional e-business brokers, we deal with sellers all the time and know the right questions to ask to help out our buyers and to make sure we are dealing with legitimate websites as investment vehicles. A website broker will help tremendously through the due diligence process and will most likely provide key information that buyers would not have uncovered on their own. Conversely, any sellers that are not sure how to handle tough due diligence questions from buyers, can turn to a website broker at wesellyoursite.com for assistance.

Tags: buying a website, due diligence, investment