One great form of passive income is to own an online business. This could be a simple blog, an affiliate website or even an amazon drop shipping website however at a certain level it can provide a decent level of income. A successful online business can also provide a nice little capital sum should you choose to sell this. If you are lucky enough to sell a successful online business (or if you are in the market to purchase one) you have more than likely seen many of the popular website marketplaces that buy and sell online businesses.
In this post we go through 5 popular online marketplaces to buy and sell an online business.
Probably the biggest online market place in terms of the size of the deals that it brokers is Empire Flippers. From humble beginnings in 2011 to now being one of the USA’s fastest growing companies, Empire Flippers is the gold standard online marketplace when looking at selling an established online business.
Founded by Justin Cooke and Joseph Magnotti Empire Flippers has grown exponentially in recent years employing well over 50 staff members and is now pushing $100M a year in business valuation sold annually through Empire Flippers.
Like nearly all online business marketplaces they started out selling businesses and websites with a low price range however you would be lucky to find a website or online business advertised on Empire Flippers for less than $250,000.
Given the level that Empire Flippers now operate at, they perform thorough due diligence on all deals all available once you set up an account with Empire Flippers. For both buyers and sellers Empire Flippers offers great resources and information on the buying and selling process and some tips you should be looking out for before making a purchase or a sale.
Empire Flippers also offers the product EF Capital which allows people to invest in online businesses or websites whilst not having to run the businesses themselves. EF Capital pools capital from investors and hires operators to run websites that Empire Flippers purchases to enable (in theory) investors to receive a passive income stream without running the business or website.
For those looking to purchase a large online business or website (or looking to sell) Empire Flippers should be your first point of call.
The biggest rival to Empire Flippers as the largest online marketplace, whilst Flippa also offers pricier websites and online businesses they also offer lower end prices. Flippa was founded in Melbourne Australia in 2009 by Mark Harbottle and Matt Mickiewicz coming from their previous collaboration SitePoint (SitePoint Marketplace). Flippa has continued to
grow and now has several offices around the world along with millions of members who enjoy the great service provided by Flippa.
Flippa’s main point of difference between Empire Flippers is that they have that lower price valuation (under $100,000) which allows more people to enter the and also give business buyers a quicker potential exit (given that not a lot of people have access to hundreds of thousands of dollars to invest in online businesses).
Flippa also offers a wide range of services from Flippa Finder (find you a potential investment within your parameters and filters) as well as potential financing and a partner market (should you want to invest with another party). For those with less experience in running an online business or website Flippa could be the ideal starting point for businesses that are at a good price point for you to gain experience whilst not opening yourself up to financial ruin if your investment doesn’t work out.
A relative newcomer to the online marketplace arena, Motion Invest was created in 2018 by Kelley Van Boxmeer, Jon Gillham and Spencer Haws as a marketplace looking to focus on smaller lower income producing online businesses and websites. The main focus for Motion Invest is listing websites or businesses that exclusively have a lower valuation (compared to Empire Flippers or Flippa) and it is rare to see a site listed on Motion Invest that would be valued at over $100,000.
As you would expect given their target market, buying and selling costs are cheaper than those commanded by Empire Flippers or Flippa. The deposit required to purchase a site is also lower than most online marketplace competitors. Motion Invest also operates their buy/sell as a Dutch Auction.
As a newcomer Motion Invest only offers buying and selling options and no additional services such as financing or sourcing websites however they are a great addition to the online marketplace industry.
One of the first online marketplaces to target the larger online businesses or websites, FE International has offices in New York, Miami, San Francisco and London and similar to Empire Flippers was also a member of the Inc 5000 club.
The FE International target market is usually for businesses valued in the millions (though some businesses and websites are valued $250K and above) and as you would expect they also provide extensive due diligence for their clients. FE International also tend to advertise more SaaS businesses than other marketplaces on this list.
Other resources that FE International provide include detailed buyer and seller FAQ’s and buyers guide and a referral program. FE International are right near the top in regards to reputation in the upper end of the online marketplace sector.
Not a dedicated online website marketplace per se, Facebook Groups have quite a few website/online business buying/selling focused groups that can provide some good options without any of the brokerage fees that are charged by all other examples on this list.
Popular Facebook Groups in the online business/website buy/sell arena include Niche Website Flippers and Website Flipping.
Purchasing through a Facebook Group has its own pros and cons and obviously should only be entertained by those with substantial experience in buying and selling online businesses and websites.
Buying an online business should definitely be on your list when looking to build your passive income streams. Using a quality online marketplace such as those listed above will give you peace of mind knowing that a lot of the risk of purchase has been taken out of your hands and all you need to do is to focus on growing your new purchase to the level you believe it can get to.