What happens when two experienced Flippa users meet on the marketplace? One fantastic transaction! Since it’s just about midterm season in the Northern Hemisphere, we’re bringing you a case study of a site that’s sure to see a lot of traffic these days: StudyGuide.org.
The seller, Tommy Noonan, is one of our top sellers on Flippa (he’s even written a guest post for us before). He started out selling websites when Flippa was still part of the SitePoint Marketplace, back in 2007, and has been working over the last year to sell off most of his website portfolio in order to focus on his main projects, both online and off, and his worldwide travel adventures.
One of the web properties he was looking to sell was a study guide site he picked up from the original owner in 2009. The site, StudyGuide.org, was in a rather sorry state, but where others would have seen a dead site, Tommy saw a great opportunity.
“I was actually searching for potential link partners for an education-related site I had started. Through some random Google search, I stumbled upon StudyGuide.org. I noticed that the layout was absolutely horrendous, pictures were distorted and didn’t line up properly, and there was a message on the homepage from a few years ago stating there would be no more updates. But what really caught my attention was that the Alexa rank was under 200k.”
Tommy got in touch with the site’s owner, put in an offer, and purchased the site. He then set to work on re-building traffic and revenue, and rehabilitating the layout. “I had inadvertently created a process which I would repeat dozens of times on a handful of other sites I’d buy at wholesale and then sell a year later at retail.”
As Tommy was selling off his inventory of websites, he listed StudyGuide.org in January 2012 with a $1 reserve. That was a gutsy move for an experience seller, but Tommy knew that the site, which was earning just under $600 per month in profit, would quickly attract interest.
That’s where Will Swayne and Nick Schoonens come in. Partners at the online marketing agency Marketing Results, they were looking to expand their website portfolio of revenue generating websites. As Will describes it, “we were trawling around Flippa looking for websites that met our criteria of not requiring any special knowledge or skills to run, with existing revenue, and with upsale potential. StudyGuide.org seemed to fit the bill”.
Though competition was stiff (the listing attracted 68 bids), Will and Nick had their heart set on winning the auction. “We were pretty keen to win, though I have to admit the price was rising to a point where we were about to bow out. The final price definitely factored in “future potential” as it was about a 3X multiple of annual earnings,” says Will.
While the process of transferring website ownership can sometimes be tricky, both the buyer and seller had been through the process several times before, and knew just what to do. “The transfer process was very simple. I’d done it dozens of times before, so I already had a system that worked. Transferring the domain between Godaddy accounts is a breeze. Then its just a matter of transferring the files and database to the new owner. They go through the site and replace all the ad/analytics codes and then you’re basically done,” says Tommy.
Since the sale took place, eight months ago, Will and Nick have made several improvements to StudyGuide.org: “We’ve done a few things since we took over, including changing the site over to a more manageable CMS, testing new advertising partners, adding email marketing and creating a new system to moderate comments.”
What’s next for this pair of buyers? They are looking to continue expanding their portfolio of websites, in order to test optimisation strategies while making some money on the side. Check out their work at Marketing Results.
As for Tommy, he’s now down to just a few websites, including his main online project. “It feels great to be able to focus on my main project, and not have the distraction of 40+ other sites. I’m also focusing more energies on travel, learning Spanish and blogging.” You can follow his blog at TomsAdventure.com.