Downsides to Selling Your Site
You’ve worked long and hard to create a website that generates income. From design tweaks and branding to behind the scenes SEO and sales funnels, you turned an idea into a profitable website.
And now you want to cash in on it.
Enter Empire Flippers.
You’ve calculated a reasonable asking price using the valuation tool and the payday sounds promising. But as eager as you are to offload your site, you’ve forgotten one incredibly important reality…
It’s not all sunshine and gummy bears for entrepreneurs who choose to sell their websites or businesses.
Though selling your site can be very rewarding and financially abundant, there are also several downsides to selling it that many folks don’t consider.
To prepare yourself for the reality of selling, we are breaking down some of the biggest pain points we’ve seen from sellers and sharing possible solutions to help you avoid them as well.
Did I Just Sell my Golden Goose?
Hindsight is 20/20, but if you’re considering selling your website, then it’s really important to consider how it might feel if your website starts doubling its earnings after you sell. This could be a pure fluke and the website hit its stride after the sell, or perhaps the new buyer injected new life into it and ran it better than you.
Whatever the cause, this does happen. Businesses can experience late onset growth spurts, so sellers feel like they’ve lost out on money and may be plagued by a feeling of regret when they see their old site suddenly become more profitable.
First off, it’s important to realize that the site itself is not the greatest object of value. The REAL golden goose here is your own learned skills, which allow you the ability to repeatedly create successful, profitable sites over and over again. It’s rarely the individual site – that’s more like the egg!
If you’re worried your business will take off without you, there is a solution worth considering — the seller can retain equity in the business. For example, if your website is listed at $100k, you can negotiate with a buyer. Offer to knock off $15-30k and keep 10-15% equity in the website. This way you experience some of the rewards should it start to grow after the sale.
Even though you are losing out on some cash in the original deal, you are banking on its future success with the buyer. Oddly enough we do not see this often, but it’s worth looking into if you don’t want to be 100% invested in managing the site, but still want an opportunity to profit should the site start growing.
Why Don’t I Hold Onto It and Earn More Monthly Revenue Before Selling?
This is just bad math.
You cannot predict what the future holds, and you don’t know if holding on to the website is going to be as profitable as you think it will be. In most cases, sellers who feel this way are often uninterested in the website, and not really working on building it up or growing it. Their initial excitement and motivation for originally starting the website is waning and they’d prefer to move onto something that really pumps them up.
Holding on to it amounts to retaining a declining asset.
You could hold onto it and earn more profits, but is it worth the stress of holding on to something you have no interest in anymore?
A solution to this is to stay firm on your price. You might receive lowball offers, but just decline them and wait until you get the offer you want. This might result in you holding on to the site for a bit longer, but ultimately this is a great workaround for those who were worried about letting it go so soon anyhow.
What If My Next Project Fails?
This is one of the biggest entrepreneurial fears. The fear that your sophomore project will not be as successful as your first.
Remember, there is a reason why you are moving on to your sophomore project. Often times it is because you have developed new skills which will better be applied to future projects. Of course, this doesn’t mean that your next project will succeed, but perhaps your third will be the next golden ticket.
One solution is to step into projects that use 70% or more of the skills or experience that you already have — the same skillset that led to the success of your last site.
By using these skills, you are playing to your strengths, and it’s a bit easier to transition to a new business when you already know you can do the majority of the work necessary to make it succeed.
Loss of Reliable Income
A huge cash injection post-sale is always exciting, but without reliable monthly income in the future, it can be damn scary.
For some, this is a massive motivator, but for others it can be stressful. Now you need to decide what your next move will be.
A great way to avoid this feeling is by holding off on selling your website until you have Plan B underway. Before selling, ensure you’re at the point where you’re ready to launch your next project and primed to push hard for its success.
In this scenario, there is no actual pressure to sell. The cash injection serves as money to supplement the new income you are producing (or set to produce), rather than money you need to survive. The marketplace isn’t going anywhere, so get your ducks in a row and then pull the trigger.
The Buyer Kills Your Baby
This sounds morbid, but most entrepreneurs feel like their business (especially their first one) is their baby. They put a lot of blood, sweat, and tears into making it successful so the idea of watching someone else take it away and kill it is devastating.
We’ve actually seen this with some of our own sites, which we eventually sold. The buyer took it over and then did nothing with them, let the hosting going down, the domain expire, and there was nothing we could do. It was painful to experience.
Just remember that although this was your first baby, don’t stay in the past. Let it go and move forward. The best solution is to put your energy into your new baby!
Note: This is no reflection of our future parenting skills!
Your Buyer Is Needy
Some buyers need more handholding than others. If they are brand new and getting started, the buyer may need a lot more work during the transition.
We often see this with sites selling under $20,000, in cases where the buyer has more money than time, or are just looking to get into online business.
At the beginning of the deal you may not be able to identify what kind of buyer they are going to be, but you can be explicit with your support offer. Be clear on how many days and/or hours you are willing to give in support. If they go over, list a per hour fee. The more explicit this is from the get-go, the better.
Another way you can get around this issue is by using a broker (wink wink) who can guide you through the selling process. We have plenty of repeat buyers, so if you’re new to selling we can help you navigate the waters and find a buyer who is reliable and savvy about what they can expect from the sale.
Are You Ready to Sell?
Whether you’re a seasoned seller or ready to let go of your first website, we want you to be prepared for what’s to come.
Selling your website can bring up insecurities in your ability as an entrepreneur, and really make you come face to face with some of your biggest fears. The fear of failure in your next project, the fear of missing out on steady income, or the fear of watching your baby crash and burn in the hands of another. Needless to say, selling a website can be much more emotionally and mentally taxing than you imagined.
On the other hand, there are so many upsides to selling as well. It gives you the opportunity to dive into something different, pursue a new passion project, and really challenge your entrepreneurial skills.
The key to selling is managing your expectations and preparing yourself for the experience. An open mind and a helping hand from experienced brokers (hint hint: that’s us!) will help you break on through to the other side.
If you want to listen to us riff more informally on this, you can check out our original Empire Flippers podcast episode.
We want to know, if you’ve sold a website before what was one of the biggest downsides you experienced, and what did you learn from it? Share your experience in the comment section.