I’ve actively bought and sold over 140 transactions on Flippa since 2011. Most have been small deals early on but the smaller the deal, the higher the risk, and this experience has allowed me to see all types of scams and red flags on Flippa.
Flippa has come a long way since its early days as a marketplace. There were more scams early on and many of them are no longer possible due to improvements they’ve done.
In this write-up, I will cover the most common scams on Flippa as of today.
Let’s get into it!
Is Flippa a Scam (in general)? No!
No, Flippa is not a scam.
Flippa is an open marketplace (like Ebay) where sellers can list their businesses for sale. Sellers are allowed to state revenues, costs, descriptions, and more on the for-sale listing page.
The challenge with Flippa is deals are not vetted before going live. All risks fall onto the potential buyer to look through the listing data, ask questions to the seller, and understand whether it’s a scam or not.
If you know what you are looking for, Flippa is one of the best places to find websites for sale! More on that at the end.
10 Flippa Scams and Red Flags That Are Common in 2021
Doing due diligence on businesses for sale on Flippa requires extra steps.
With other brokers like Motion Invest, Empire Flippers, or our own brokerage, The Website Flip, we vet the deals which include reviewing the website’s P&Ls, backlinks, domain history, and more.
However, as a buyer, you ALWAYS should do your own research before buying. Never trust a broker as their alignment is with the seller and are compensated to close the deal.
With Flippa, you have to know what to look out for since no one is there presenting the data in an easy-to-digest manner, or weeding out the scams.
Check out the most common Flippa scams.
1. Fake revenue screenshots
This is the most common scam: fake screenshots. Flippa does not vet the screenshots attached to listings.
Most content sites on Flippa are monetized via Amazon Associates, affiliate programs, or display ad providers like Ezoic, Mediavine, etc.
Using Google Chrome (or other browsers), you can load the page where affiliate earnings are shown, and then edit the HTML. Here is a write-up on how that’s done.
Check out the example Amazon Associates screenshot below for a specific month:
I’ve boxed in red places where a seller can change the numbers. This includes the Shipped Items (gross revenues), and Total Earnings. The seller can use their browser to actively change these numbers, and then take a screenshot.
However, some sellers forget to update some of the other corresponding numbers. For example:
- Seller changes Total Earnings but fails to change Shipped Items accordingly
- Seller changes Total Earnings but fails to change Advertising Fee per Tracking ID accordingly
In short, take a close look into the screenshots and see if all of the numbers match up. If you are buying an Amazon site, read this guide on specific due diligence tips for Amazon sites.
2. Fake P&L numbers
Building on the idea of faking screenshots, sellers can also fake the financials. Flippa allows the seller to enter in month-by-month revenues, and costs.
For example, here are the financials for a listing:
As you can see, each of these revenue values are editable and Flippa does not verify whether this is actually true. On the other hand, other brokers would cross-reference the submitted P&L against screenshots, video proof, and/or by obtaining logins to accounts.
Flippa uses the seller entered financials to come up with the monthly average gross revenues and net profit. See below:
3. Fake (purchased) traffic
One of the most useful features on Flippa is the fact that they pull in Google Analytics data automatically for the website. This provides proof of traffic to a certain extent.
However, the seller can still purchase fake traffic to their site which Google Analytics would track and then Flippa would show in their listing.
Here are red flags:
- Majority is Direct traffic in Google Analytics
- Majority social media traffic and the social profiles are not active
- Minimal organic traffic
- Bounce rate is extremely high (less than 90% is OK, anything higher needs questioning)
- Time on page is less than 10 seconds (most content sites are more than 30 seconds average)
4. Google Analytics data missing
Sometimes sellers do not allow Flippa to pull in Google Analytics data. One reason may be that they are trying to scam a new buyer. Another could be that they use other third-party tracking services like Clicky.
Flippa is not integrated with Clicky so it’s not an option to pull in data.
If the seller has Clicky, ask them to add you to the account so you can verify all of the statistics yourself.
If the seller has no analytics installed, you could technically use AHREFs or SEMRush to verify traffic but if you are a beginner, tread carefully.
5. Selling at a “low” price (multiple)
Back in 2008 when I got started website flipping, many niche site creators had zero ideas what their site was worth. You could negotiate and pick up a site for 10-15x monthly average profits.
Nowadays with all of the information out there about website investing, a buyer knows the true value of their site.
So when I come across a listing and the seller wants to sell quickly at a low price, I question their motive.
Note that I have bought sites for much lower valuations because the seller needed funds quickly; however, such listings are rare. If you come across a seller looking to sell for a low price, ask a ton of questions!
6. Listing description is “Too Good To Be True”
Some sellers optimize their Flippa auctions to achieve a higher sale price and be more transparent, but at times this can be overdone and false information can be shared.
An aspect of a listing that is in full control of the seller is the listing description.
Most other brokers write the description themselves to ensure as minimal biases as possible. With Flippa, the seller writes the description and thus can showcase the website in its purest form.
When I review a Flippa deal, I rarely read the entire listing. Most sellers do not list the setbacks with the website, and why they are motivated to sell. Most just list the highlights. I’ve seen some cases where sellers do not even bother to explain why the site is on a downtrend.
Here is an example of a site with a listing description that’s just overloaded with highlights:
Therefore, I do my own due diligence on the deal and ask questions pertaining to the deal.
7. Seller is not answering questions in detail
If you are messaging the seller, and they are either not responding or are not answering properly, then walk away.
If you do not have an attentive seller, they will not provide the after-sale support needed to ensure a smooth transition.
In good faith, they may just be busy and the site they are selling is just not worth their time. But that does not help you get your questions answered and you cannot be sure if they are really just busy or they are trying not to answer the tough questions because they are hiding something.
8. Duplicated content
Many sellers are just looking for a quick flip. Many sellers build sites to sell; nothing wrong with that as I do the same thing (but quality first)
However, there is a type of seller that puts together low-quality sites and places them on Flippa for sale.
Some of these sites have duplicate content. Not all articles will be duplicated though. The seller is smarter than that. They place hundreds of articles and approximately 20-30% of them are somewhat duplicated.
Here is a listing I found where the seller re-used parts of an article from another site:
Now the seller may have no clue about this since they are outsourcing content to writers. A writer may have taken shortcuts. Regardless, you need to ask the seller about this.
If the site’s fundamentals are still good (e.g., good backlinks, other good content) and only a portion of the content is duplicated, then I may still pursue acquiring the site. I would use the duplicate content issue as a way to bargain with the seller on their sale price.
9. Random (and sudden) spike in revenues
Random and sudden spike in revenues is not a complete turnoff or scam on a site for sale. However, it does require further questioning if not already answered in the Flippa listing description.
Some sites peak at certain times of the year. While abrupt, the surrounding months will still have revenes. For example, home niche sites spike in November and December, but they still have earnings in the remainder of the year.
If you see most months being zero revenue and then a large spike, that’s a red flag.
10. Starter/Template Sites
Stay away from starter and/or template sites for sale on Flippa. Most of these are pure scams! Most of these sellers are repurposing free scripts and WordPress themes. The sellers are then listing them for sale for less than $500 as buy-it-now listings.
On the Flippa listing page, a starter site will look like this:
These sites are not established businesses. They are starter sites that you can create for cheaper. These are not sites that we buy to flip.
Is Flippa Doing Anything To Stop Scams?
Yes. Flippa has significantly improved their platform and continue to do so.
For example, sellers need to verify their ID with a picture to ensure they are who they say they are. They also need a verified email address, and phone number on file. This was not the case in the early days.
Flippa will remove nefarious listings and sellers from the platform as they pop up. But of course, they are not there to verify each and every deal.
Are There Any Good Deals on Flippa?
Yes, there are great deals on Flippa!
After reading through all these red flags and scams, you may be scared to even look at Flippa.
My best deals have come from there. Here are a few examples:
- Dating site (case study): earning $800/mo average when purchased and currently earning $9,000/mo average. Aged business since 2004 with a domain rating of 50.
- Outdoor site (case study): earning $300/mo average when purchased and currently earning around $3,000-$6,000/mo depending on time of year. Aged business since 2019 with a domain rating of 40.
- Health site (case study): This is a public case study site acquired in April 2021 earning $500/mo.
For the hundred sites listed on Flippa at any given time, only 1-2 may be worth looking at. Unfortunately, that is the disbenefit to an unvetted website marketplace but the few that you do find will be quality.
Also, since you are directly working with the seller, there is more room for negotiations. A broker marketplace, like Empire Flippers, will always be in the middle of every offer you make.
Where Can I Find “Vetted” Flippa Deals?
Flippa does not vet each deal, and at the same time, Flippa has “needle in the haystack” types of deals. So how can you find these?
The Website Flip provides three services:
- DealFeed.io: a discovery tool to find content sites for sale. DealFeed sifts through all the bad deals to surface the good ones worth looking at.
- Authority Business Blueprints: Every Monday we share live deals on Flippa that pass our due diligence via our newsletter. We share highlights, setbacks, data points, and more.
- Due Diligence Service: if you come across a site for sale on Flippa, and need an expert to look over it. The Website Flip offers due diligence video reviews.
Learn Due Diligence with EasyDilligence.io
If you would like to DIY due diligence and learn the ins and outs, check out EasyDiligence.io:
Flippa scams and red flags will be common in an open-to-list marketplace. It’s on the buyer (you) to weed out the bad deals from the good ones. Note that they are the largest marketplace and therefore not many sites like Flippa exist; it’s in your best interest to learn and ins and outs.
Common sense when approaching a Flippa listing helps. Some questions to think about when reviewing a deal:
- Does the listing title and description seem to overly promise?
- Is the seller active on Flippa, or this is their first listing?
- Did the seller attached screenshots, a P&L, and other proofs?
- Does the Google Analytics data pulled in from Flippa make sense?
- Is the seller responding to messages?
In short, be aware of the common scams listed above. I’ve come across these quite regularly.