How Do You Trade Securely on Flippa? Share Your Tips and Win a $100 Voucher.
Posted on July 1st, 2010 by Luke Moulton
In most business transactions, there’s a level of risk. Risk that the seller will run off with your money before supplying the goods, and risk the buyer will leave town without handing over the cash.
At Flippa we’re dedicated to creating a secure environment for people to buy and sell websites globally. Initiatives such as integrated Escrow, phone verification and our trust ranking system go some way to building trust and verifying an individual’s credentials. However these aren’t fail safe and buyers and sellers need to take care when trading on Flippa – or any other website marketplace for that matter.
We’re interested to know, how do you keep yourself safe when buying or selling on Flippa. We’re putting together a list of trading security tips for buyers and sellers and we’d really appreciate your contribution.
WIN a $100 Flippa Voucher
How do you trade securely on Flippa?
We’re giving away a $100 Flippa voucher to the Flippa member who submits the best security tips for buyers and a $100 Flippa voucher to the best tips for sellers.
That’s 2 x $100 vouchers to give away to two different Flippa members.
Submit your best tips in the comments below to be eligible – your tips may be republished in a future post or help documentation.
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This competition is now closed…
THE WINNERS
And the winners are Aperio and Nate. Thanks guys for your great contributions, you both shared some great security and due diligence tips for both buyers and sellers. Congratulations! You’ll each receive a $100 worth of Flippa credits.
Comments (78)
Comments are closed.
July 2, 2010 - 4:03 am
@Doug & Hello,
As far as I know, PayPal’s dispute process is only guaranteed for physical goods. So if you are a buyer, you have no recourse if the transfer goes sour.
As a buyer, if I had good vibes from the seller from our communications, I might just send the money for lower-priced properties. If the site is more than a couple hundred dollars, then I use Escrow.com.
When I use Escrow.com, I make a list of what needs to be transferred, in what order, with a certain amount assigned to it. Then we negotiate that list. It hasn’t failed me yet.
Ansel Taft
July 2, 2010 - 5:01 am
10 Steps i do to keep things safe
1. I always look at seller feedback
2. I write list of things that will be trade and then get him to sighn it.
3. Call him/her oveer the phone to get things straitned out.
4. Get proof of them owning domain and stats.
5. If they are saying they make this amount per month , get proof of payment.
6. It is best to do all payments throught paypal.
7. Do reaserch on the website and make sure it is not a scam.
8. Right when get all stuff make sure o cahne all passwords.
9. If more than 100,000 get a lawyer
10. The mostt important thing is if they will not give you there phone number or nme it is proably a scam.
Ps. have a good time shoping.
July 2, 2010 - 5:18 am
Everyone here either a buy or a seller looking forward for a good offer/deal/business and being a seller I never used Escrow till date as a mode of payment and only go with Wire Transfer or Western Union and got 4+ feedback till date (using flippa almost from 2-3 months and successfully sold 4+ sites). So here are the thing I do to:
1) I always make everything clear in the auction about what the buyer is going to get and what are its advantages.
2) I always present/attach all proofs of the earnings/traffic I gain from/on that particular site/domain name/ business.
3) I present all the earning proof in the form of video i.e, using camtasia I make a video while I log into the account as you can get the pics of earnings on google but recorded video while accessing your account (hiding your login information with the help of hider) can only be given by you (seller). This really gain attention of potential buyers.
4)Providing 100% service/support even after the product is sold. ( we do that and thats why all my buyer are happy
)
5)Manual Bidding Acceptance: It is not necessary that a buyer with lesser feedback or new flippa member is not a potential customer. Just after gaining some automated bid start accept bids manually and if you find a new buyer with a lesser feedback and just do some probing with him/her and you can easily find out whether he/she is going to complete the transaction successfully or not.
6) Buyer should also clear all there question from the seller.
7) If the transfer amount is big and seller is only accepting western union then make sure the genuinity of the seller before transferring the payment.
there are many thing more you can do. Sorry have to go to sleep, i elaborate it tomorrow.
July 2, 2010 - 5:29 am
Some of the best practices as a seller that i use are from the Killer Flipping Secrets book that has been mentioned in Flippa lately.
Here are some of the methods that stopped me from getting scammed.
Before accepting the bids i do the following(i never set my account to auto accept bids)
1)The first thing i do is to see how old the account is.It’s not a real measure of security because u may sometime find new users to selling decent websites.
>If the account is pretty old i proceed to my next check
2)To check the positive feedback that the user has.If the seller account looks dodgy then i take a quick look into their feedback by individual persons
>Instead of P.Ming the person i P.M the profiles who left this person the feedback to make sure if this person is legit and if they had any problem transacting with them.
This makes sure that my bid is genuine and not scam.
While transaction i always prefer doing it with escrow if it’s higher than $1000 and split the fees between the two.
Here’s one more tip i found useful from the book if you want to go for a paypal payment
That is Instead of giving your Paypal address, invoice them through the Paypal system as goods. Then zip up the site files and put them on a CD. Post this to the buyer with a tracking number.
Simple and easy tips.When applied works wonders
Cheers,
fozer0l
July 2, 2010 - 5:30 am
“In most business transactions, there’s a level of risk. Risk that the seller will run off with your money before supplying the goods, and risk the buyer will leave town without handing over the cash.”
Wrong! That is not at all true for “most” business transactions, it just applies to dealing with suspicious “goods” with strangers on the Internet, which is what Flippa is about. A nice piece of propaganda, though.
July 2, 2010 - 9:59 am
C.L.,
Propaganda? In every business transaction there’s risk. Businesses mitigate that risk by paying consultants to do extensive due diligence on the property they’re purchasing, and on the party they’re purchasing it from.
The difference is that in relatively small transactions on Flippa that option isn’t cost-effective. This is compounded by the fact that you’re often on the other side of the world from the other party, and that you will almost certainly not meet them in person, so it’s hard to build up any trust. We’re really interested in knowing how people get over this barrier, so we can work on helping out with it.
July 2, 2010 - 6:13 am
Hi
i am just share it that i am feel myself too much secure at flippa that when ever any problem is happened with me.Flippa consider that problem as it is the problem for flippa.
I strongly suggest that ESCROW.COM is a great offer by flippa for security point view.
Thank you
July 2, 2010 - 6:54 am
Hello,
Am new to flippa.. but i think to make things easier and secure, I’d prefer flippa setup an online application where you integrate your paypal account or any other account..e.g(liberty reserve, local bank account) etc. flippa takes charge of making sure the transfers are authentic by send the money which should have been in their custody to the bid winner once he confirms that the purchased good(s) has/have been completely transferred to the bid winner. In a situation where sending the money would be a problem to flippa in terms of cost to say maybe a local bank account, they can charge the person whose selling the transfer fee. Escrow is a good agent but many people complain of their procedure and them not accepting people from some countries. It should be noted that flippa has no country restrictions and as such, the payment procedure used should not have any restriction to people from a particular part of the world..
I hope i have contributed to this in my own little way to make our flippa grow into a big boy…
Keep it up guy, you are doing a wonderful work.
July 2, 2010 - 8:23 am
You can take the following route if you are buying expensive web property:
Fly to the country the seller is from, meet him in person and show him that transfer goes well.
July 2, 2010 - 9:44 am
It’s very important to negotiate with the buyer before you accept his bid.
From the way of the negotiation you can know if the buyer is serious enough or not.
In most cases the buyer sends you pm before he makes his bid. (my experience )
Check the buyers feedback and look at how many sites he had bids on and how many of his bids where accepted , if 50 % was accepted than there must be something wrong with that person .
Flippa also has the ability to check how many comments the person made on auction treads and how many of them where deleted (ask the buyer why his comments where deleted )
make use of escrow For sites sold higher than $500 and try to split the escrow fee with the buyer, escrow is the best for auction in my opinion but you can not always use escrow if your site get sold for $200 for example .
A serious buyer will make any effort to contact you via phone or skype because no one is going to send 10k just that easy even via escrow .
July 2, 2010 - 10:03 am
Wow! Great feedback guys. Awesome stuff so far. We’re going to give this another couple of days before we close the comments and announce the winners. Thanks for the feedback so far.
July 2, 2010 - 10:15 am
As I seller this is what I do before accepting their bid.
1) Ensure they are honest by checking their online history (search their username / email on google keeping an eye out for scam sites or -ve feedback on other sites such as digitalpint or webmaster-talk).
2) Ask for their social network accounts if they have any such as Facebook, Linked.in and twitter accounts etc.. Who says we can’t remain friends after the sale ? This is also helps to gain each others trust.
3) Agree to both sign a contract as well as provide ID on identity, such as a photocopy of each others passport / driving license or utility bill. This is also to confirm each others address.
4) Provide proof of ownership of the domain / site either by screenshots or glance.net live video session.
6) Agree on a transition plan, either the payments are split up and the site is transfered in parts, for example: the first 1/3 of payment is sent for the FTP / backup of the site etc..
7) Guarantee to provide (as part of the contract) at least a seven days of support and guidance.
9) Also offer a 24 hour refund policy.
10) Payment should be made ideally by Escrow, if not then we would either meet up in person (if a large ammount or use another reliable 3rd party service).
Note: I would not recommend Paypal or AlertPay.. as they both are flawed systems especially for large ammounts of monies.
These are the steps I take when selling a site.
Hope this helps you out Flippa.
Let me know if it was useful and about the voucher
Coder
July 2, 2010 - 10:52 am
Have a trusted escrow service that will take the worry out of those large transactions. Buying a $300 website with out an escrow service is one thing, but a $30,000 website that is fake could be take a many years to make that money back.
With online video, you could do a verification process, like using driver license or passport as a verifier. Does the video match picture in the document?
Use a local person to verify that person or company that is trying to sell the website.
July 2, 2010 - 11:47 am
In my opinion, of course for the new buyer or seller, the safety of the trade security is FIRST.
For better to remember, just follow this beta 7G Formulas
1) Go feedback: Bidder/seller please gives your feedback. Check the overall feedback of the client.
2) Go negotiate: Bidder/seller can have a professional negotiation by pm/comment.
3) Go genuine: Check the genuinely of the information which is given by the bidder/seller. Use the profile image wisely.
4) Go Escrow: Use a safety online payment for the high value transaction.
5) Go proof: Give a complete brief about the website or domain. Video proof is very acceptable.
6) Go question: Question is very important to mention. Ask the seller/bidder about your curiosity.
7) Go talk: Contact the bidder/seller by Skype or by phone which have been verified in Flippa.
All right guys… You can MORE G if something missing.
Let’s Go Flippa
July 2, 2010 - 12:30 pm
I have bought several properties on Flippa and learned from my mistakes. Here’s what I consider when buying web properties, in order of importance:
Owner due diligence:
1) Feedback score from other buyers. If the seller has even one negative feedback, this a big red flag. If this is combined with a low trust rating, less than +3, don’t touch the listing. If the trust rating is high, ask seller to explain the negative feedback. Buy only if satisfied with the answer.
2) Check the name of the buyer via “who is” for the domain he is selling. After getting name from who is, check owners profile in LinkedIn and Facebook to judge trustworthiness from background.
3) Google the name of the buyer with the term “scam” next to it and see if there are hits.
4) Next look up buyer and website on ripoffreport.com. If mentioned even once, stay away.
5) If who is shows anonymous, be very careful, seller may have something to hide.
Website due deligence:
1) Do an overall site statistic check at spydermate.com. Look for a score of at least 50.
2) If pagerank is 0, be suspicious that site may be banned from Google. Love ‘em or hate ‘em, Google’s pagerank system is a great indication of site authority and legitimacy.
3) Search for “site:www.sitename.com,” if nothing comes up, they are likely banned from Google. If different site comes us, pagerank may be faked.
4) Check history of website in wayback machine (archive.org). If website was set up do do something completely different 2 years ago, be careful. It just may be a “drop catch” repurposed website with temporarily good pagerank and traffic.
5) Get a paid membership at Copyscape. It’s cheap. It will allow you to do in depth analysis of whether a site is copied, and violates possible copyright laws.
6) Verify that any adsense revenue claims are legit – that all the revenue is coming solely from the site you’re buying. Many sellers are cheating on this one.
7) Check Pacer for possible lawsuits
9) Use SEMRUSH to determine whether the predicted search engine traffic is consistent with claimed traffic.
These are some of the tools I use. Buying websites can be very rewarding, but only if you do your homework. The devil is in the details. And there is a lot to lose, so take care when buying.
All the best,
Alec
July 2, 2010 - 6:05 pm
My Best Suggestion about site transfer and digital tranaction.
After buyer and seller agreed on payment term and method important thing si site transfer. Here my tips is 50-50.
First Buyer check all details, then pays 50%. After confirming the payment Seller gave buyer all necessery backup, site access, email login. Then Buyer will have everything up and running on his end.
Now Buyer Pays rest 50%, and seller process on domain transfer.
This process is super secure as without domain you cand really steal much. Its safe for both.
And if site is good earner like e-commerce, then you could do another thing.
At first buyer pays a deposite money like $200 or $500 USD, and seller changes PayPal email or give admin authorization. Let it run for 1 day, then Buyer will see all real earning and gain more trust. And then process in the process i described first.
I used this process for long time, Its well tested process. I hope it helps other too.
July 3, 2010 - 2:14 am
No offense but your process is too complicated. I don’t think I would ever transfer my files to someone without getting 100% of the payment.
The person can easily use the files to create another website to compete directly with me.
The safest way to do business is to use Escrow where the money is locked until the transaction is completed. This method is so safe that even banks and real estate agencies use it.
That’s my 2cents
July 2, 2010 - 11:37 pm
Split the fee with the buyers to make sure they are interested before they bid.
Avoid members with a negative rating
Open up communication with the buyer/seller as soon as the listing is over
July 3, 2010 - 3:35 am
I think the best way is to deal with people that you can trust. I think it is very shady for people to not even post their photo to their Flippa profile. I just stay away with from people who have done little to get themselves verified. Honestly, it is not hard to connect to your Facebook account. If someone is not going to take the time to do that then why should I think they have a good site to see or will follow through on the transfer.
July 3, 2010 - 3:56 am
=== If you are a buyer ====
1. Read the terms of the sale carefully. Make sure you understand exactly what is included with the sale including the domain, files, responsibility of transfer, server requirements etc.
2. Ask the seller for clarification on any items that are not clearly specified or that you need more information on.
3. Do your due diligence. Do the seller’s claims sound reasonable and does the data back it up? In addition to the data provided by flippa, do your own independent research and analysis of the data claims. Don’t be afraid to ask the seller for addition proof of traffic stats, earnings etc. In fact, make it a point to do so, so that you can have some direct personal contact with the seller. Check the whois data to see if it matches the data provided by the seller.
4. Professionalism and History of the seller. Take the time to go through the seller’s feedback history. Contact previous buyers to get their feedback. If the seller has a lengthy sales history, take samples from both recent sales and sales with some longevity so that you are able to get an accurate snapshot of the opinions on the quality of sites, claims and service from a long term perspective as well as a snapshot of the seller’s more recent interactions and quality of service with recent transactions. Pay attention to how the seller responds to inquiries. Are they prompt and professional? Is this someone you would feel comfortable in having to approach with any issues or questions after the sale as well? Are they clear, open and honest in their responses?
5. Use escrow for large transactions. Now that Flippa offers the escrow option as a part of the sales process, it’s even easier to expect to have this bit of protection from a large ticket sale. If the sales price for an auction is substantial and the seller is refusing to use an escrow service, that can definitely be a red flag.
6. Legal representation. If it’s a high priced transaction, then in the best interest of all parties involved it would be prudent to involve an attorney in the proceedings. Many firms have attorneys that are specifically versed in internet related contracts.
7. Contact the seller on the phone. Sometimes an actual, live “person to person” conversation can reveal quite a great deal of information that you wouldn’t necessarily extract through written conversation.
8. Keep a paper trail. Keep the conversation within flippa during the transaction. If for no other reason than to have at least some flippa bannage recourse if things go sour.
9. Use common sense. There’s a reason the saying, “If it’s too good to be true, it probably is” has been around for so long. Don’t let emotions take over in the place of good old fashioned common sense.
==== If you are a seller ====
1. Be clear in the terms of your sale in your auction listing. Leave no room for misunderstandings. Make sure you specify exactly what is included with the sale including the domain, files, responsibility of transfer, server requirements etc.
2. Check the buyer’s profile. How long have they been registered? What kind of feedback do they have? Just because they are brand new doesn’t mean they aren’t a legitimate buyer, but it may be one thing to consider in the greater scheme of things. If this is the case, then don’t be afraid to ask them for references. Request a phone number that you can contact them at. How they handle those requests alone may be some insight as to whether this is someone you want to have dealings with or not. As stated in the points for a buyer the same holds true for a seller – Sometimes an actual, live “person to person” conversation can reveal quite a great deal of information that you wouldn’t necessarily extract through written conversation.
3. Follow-up on past purchase history. If the buyer has had other previous transactions, contact the sellers to get feedback on how this person was to deal with. Contact sellers from recent transactions as well as older transactions. You want to be able to ensure that nothing went wayward after some length of time after a sale, etc.
4. Handle the transaction through paypal as a transaction for physical goods rather than services. You would then need to ship the site data in a physical format to the buyer that includes a tracking number. This way, if a dispute should arise later with the buyer claiming the product was never delivered, you have a tracking number and proof of shipment/receipt by seller.
5. Keep a paper trail. Remember: if it isn’t documented, it didn’t happen. Keep your communication inside flippa during the transaction period so that you at least have some sort of recourse if something goes wrong (i.e. the ability to get someone banned for shady dealings).
6. Legal representation. If it’s a high priced transaction, then in the best interest of all parties involved it would be prudent to involve an attorney in the proceedings. Many firms have attorneys that are specifically versed in internet related contracts.
7. Continuity. It’s good practice to ensure that the email address registered with flippa (as seen in the buyer detail box) is the same email address that you receive payment from.
8. Common sense. Due diligence isn’t only for buyers, it’s for sellers too. Don’t be afraid to follow up with potential buyers to ask them questions as well in order to form some type of opinion of what kind of person you are dealing with. Consider also risk and reward.. meaning, you may be more willing to take a risk on a new buyer for a smaller priced auction listing than a larger one and on the contrary, if it’s a larger priced sale or one that you feel more ‘protective’ of then trust your instincts and be more selective of the bids you approve.
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And a few other good practices in regards to having a safe transaction, aside from the monetary aspect…
For sellers: Use temporary passwords when giving someone access to your server. Restrict their access to only the actual areas and programs they need. As soon as the transaction is completed, remove any temporary user accounts created or change temporary passwords to restrict access.
For buyers: In the case where the seller is installing the site, grant access to only the area needed (i.e. not your entire server and all your sites, but only to the one site account that they are transferring files to). Set a temporary password so you keep your regular password secure. Change the passwords to the sites you purchased and update it with your personal information as applicable (ie set the admin email to your email, ensure your contact information is accurately reflected for the domain name).
There’s always more, but that’s a good start.
July 3, 2010 - 6:40 am
Hi Firends,
Self Awareness Is The Best Key For Success.
Being a seller on flippa I had mentioned several tips for seller which can really help them in complete there transaction smoothly and gain more money from there auctions:
http://flippa.com/blog/security/security-comp/#comment-5316
But yesterday I thought about the things that I might had done being a Buyer before making a transaction or buying a site.
1) Never go with Paypal as paypal do not assure you the guarantee of quality n quantity. (i.e you bid and won a diamond ring and the seller send you a bronze ring. In that case even if you file the case on paypal it will go in favor of seller.)
2) Most of the time buyer bid on the items with higher revenue or PR. Please make sure that the information is current by checking it on different source present online. (i.e I saw a website selling on the flippa stating Earning profit of $300+ in last month with less then 100 unique visitors that mean almost every buyer is making a purchase.)
3) If the amount is big than always make the seller sign a document which contain all the information presented in the auction with in ID proof. (send the form or document in the scan format via attachment in email. I m sure if the seller is correct then he/she will not mind it.)
4) Checkout the seller’s feedback even if you win the auction for $50 as every penny of your worth a lot (atleast for me
).
5) Contact the last buyer and ask them about there transaction experience with seller.
6) If the bidding amount is big then never make the payment in full. Just divide it into part (make the seller work and then send the next payment.)
7) Do check the website value on alexa and the type of traffic its gaining as many sellers buy traffic (i.e 10,000 visitor for $7..lol) to increase there alexa rank, which really help them to sell the dite for good amount.
If you have any question then please feel free to contact.
For Flippa: Contact verification, facebook link, linkedin link are not a strong method of verifying a seller genuity. Flippa should also introduce some good mention for it. Asking there members for identity proofs etc. As many countries dont have strong policies/rule/law for frauds made online and it hardly cost less than a dollar to buy a phone connection and Facebook & Linkedin are FREE !!
I know Flippa always say that it is just a platform but I must say that it is among the reputed platfroms and some more step/move will make is a king as well as add a star on it.
If you have any question then please feel free to contact.
Take care & Happy Shopping
July 3, 2010 - 6:33 pm
1. always make sure you log out of any ‘secure’ website.
2. Be very diligent about changing your passwords.
Recently I had my Paypal account hacked, and the offender was able to pay for ‘online video services’ from my bank. An immediate dispute claim to both Paypal and the service provider returned my funds to me.
As we all get so completely ‘computer literate’ it pays to NOT forget the basics.
July 5, 2010 - 7:32 pm
There are a lot of flippaers joining this and I am curious about the deadline to announce the winner
July 6, 2010 - 10:32 am
Thanks to everyone who’s contributed, to say we’ve been impressed with the suggestions would be an understatement.
We’ll be sifting through all the website trading security tips over the next couple of days and announce a winner by the end of the week.
Comments (and this competition) are now closed!