EFP 92: Do You Want To Partner With Empire Flippers?

Justin Cooke

May 1, 2014

We’ve always balanced our content on the Time Vs. Money crowd, but we haven’t provided enough value for those whose time is extremely limited. We know our buyers are busy and can’t to commit hours every week to maintaining a website, keyword research, adding content, etc.

We’re aiming to solve this problem.

There’s way more opportunity to look at websites as online investments as actual assets and invest in them appropriately.

How Partnering with Empire Flippers Can Help You

This week Joe and I are laying out the plan for passive earners where you get to actually “partner” with us on a website and we’ll build out the website for you. We’re still working out the finer details as it’s a rather complicated project to flesh out, so we’re hoping you can give us your thoughts on what you’d like to see.

Keep in mind that everything we talk about today is very much in the beta phase and we’ll need time to get to where we want to be with this.

We’re really looking forward to your input on this!

Check Out This Week’s Episode Here:

 Direct Download – Right Click, Save As

Topics Discussed This Week Include:

  • Our new plan to give buyers the chance to partner with us in their website purchases and investments.
  • The long-term vision, where we’re going with this, and a different way to look at online businesses.
  • ROI, risks, and a snapshot at several different scenarios.
  • ROI comparisons to S&P, real estate, and several other investment strategies.
  • Our ETA on the release of the option to partner.


Help Us Out:

  • “The Empire Flippers are looking for people who want passive investments. Let Justin and Joe build out your sites!” – Tweet This!

What are your thoughts on our partner investment strategy? Do you have any recommendations on what you’d like to see? Anything we missed? Please let us know on SpeakPipe or comment below!

Photo Credit: Chris Brown on Flickr

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  1. Yuv says:

    Hi, is this service is still available? If not, do yoy have something similar?


    • Justin Cooke says:

      We’re currently beta testing the first Investor Program and have closed it off to new investors. Assuming all goes well, we’ll likely be opening this up again in Mar/Apr 2016. Will let you know when we do!

  2. Eric Watts says:

    As you are selling what the SEC considers investments, what is your Broker Dealer registration number please?

    Have you done any of the legal homework around what you are doing?


    • Justin Cooke says:

      Hey Eric,

      Did you actually listen to the podcast?

      Either way, our understanding of how this works has developed quite a bit since we first published this podcast. Keep in mind that we’re actually selling “websites” not investments. Ultimately, the buyer owns these websites free and clear – we’re simply looking at offering “property management services” to maintain and grow the sites post-purchase.

      Either way, we’ve spoken to investors, attorneys, and accountants about this. Would you like to add something to the conversation? I’d love to hear it!

  3. This is a great idea with loads of potential. I would like to find out about progress and information on the beta program? Has an update been published recently?

  4. This is a great idea with loads of potential. I would like to find out about progress and information on the beta program? Has an update been published recently?

  5. Wes Grasty says:

    I think you also mentioned a dashboard to review the sites as you go along. Is that dashboard available to the public to use for their sites? It sounds like it’d be very helpful for online businesses in general.

    • Well considering it’s just in the concept phase anything is possible. However, it was not our intention to allow the general public to use it as revenue updates would be done manually by our team on the backend. The interface would just look pretty.

  6. Anthony D says:

    Hey guys,

    I’ve been listing for quite sometime but have never posted till now.

    If this something that actually happens I would be a very interested in persuing.

    I think structuring the arrangement in phases makes sense for both parties. Keeping things as clear and simple for the “beta” stage key as well.

    I would try to control as many variables as you can that make sense. For example, there is a baseline level of risk in any investment, this is no different. At least for the first go around, I would strongly reccommend that you have the same terms with each investor. I think at this point if you had custom terms with each investor that could cause some trepidation. It could also, cause some emotioanl strain on you and your team.

    Start-up Phase

    A 50/50 split for six months on base profit (what I would call the profit from day one).

    Growth Phase

    After the start-up phase I like switching to a 70/30 split (investor/you guys) on base profit and 30/70 split (investor/you guys) of growth profit. I’m not married to the 70/30, 60/40 could work as well, but I do like the reverse split on base profit and growth profit.

    Break-up fee

    I think having an agreed upon process for both parties to walk away is also important. As you mentioned, the investor owns the site, they can sell at anytime. One thing here I think is fair to you guys, is you get exclusivity to sell it for a fixed period of time.

    If you guys want to walk away, maybe you can have a ramp-down period (could be fee based) so you will help the investor transfer operations.

    More than happy to discuss more if you guys want to brainstorm…

    • Justin Cooke says:

      Hey Anthony,

      That’s a great point – keeping it the same for everyone in the beta would make things a helluva lot easier and probably be much more fair. We won’t be able to make everyone happy, but we’re going to have to test through something that would work for us on a wider scale anyway.

      Both sides being able to walk is something we’ll definitely bake into the deal.


      • Anthony D says:

        Hey Justin,

        I have always been of the mind set if you make everyone happy you aren’t pushing the envelop enough. It sounds counterintuitive to some but I think the premise is solid.

        I agree as this scales, you guys will do a handful of — measure, test, refactor…

        Looking forward to see how this pans out!


  7. Rick Van Meter says:

    Hi guys, great idea.

    Yes I think you getting 50% for six months on the base profit and then dropping to 30% is a better structure. Two reasons: i) because you are getting 70% of the growth, and ii) 50% doubles the payback period for the investor and in light of algo changes – which is the
    biggest unknown – doubles the investment risk for the investor.

    I also think 3% monthly is aggressive. I think you would make a better impression on investors if you gave them the lower growth rates that would yield them a 75% ROI and a 100% ROI rather than 136% ROI. You also need to consider taxes in your ROI calculation.

    The biggest benefit though, which I think you only barely mentioned, is that I can sell the site at any time and keep 100% of the proceeds (less 5% fee). So, I make a capital investment, have you guys increase the value, then sell it in a year before google screws me. I think if you stressed this idea you would attract Fred Flippers, rather than just Portfolio Pauls. Truth be told though, we all are a mix of both, and we change from month to month. I would bet that many of the Fred Flippers would eventually decide to keep the site if you do a good job. This
    will expand your target market.

    You may want to consider a 10% fee rather than 5% if thesite is sold before a certain time, one year perhaps.

    Great idea. Rick Van Meter.

    • Justin Cooke says:

      Hey Rick,

      Yeah – our reasoning for the 50% for 6 months would be so that we have enough $$ on our side to make significant investments in growth for the first 6 months. After that, we’re up for the gamble of taking our upside on growth, I think.

      I get your point about growth – I think when we do a written post on this we’ll go over several models and really lay it out. (Possibly with our spreadsheet/calculator for others to use) Before we do that, though, we both want to sit down with a savvy investment guy/gal to review the model.

      You’re right regarding the flipping/selling piece. We may offer a discount on the re-sale of the business – something we need to discuss. We’d like to keep that business in-house, though, clearly.

      I’m not sure we mentioned it on the show, but there would be a cancel policy on OUR end too. If we canceled I don’t think we’d require the 5% exit fee – but we do need a way to untangle ourselves from the agreement if it’s not something we’d like to continue. I think it would also include a 30 day warning to give the buyer/investor some notice/time.

  8. Herbert Camey says:

    Awesome. ..

  9. bobdak says:

    Justin and Joe,
    Listened this morning on my way into work … I would jump at this but don’t have the $40,000 — i do understand others to. I’ve got 4 to 6,000 but i am crazy scared to put that out because i want to research any site at the level, and at this price range the sites move fast … the sites you vent on empireflippers — how much research should i be doing on my side or should just i just trust your venting processes? Maybe a podcast or even better a videocast of how you guys vent sites before you post them .. might be good … one question … in episode 87 you talked about a site you were thinking about buying on Flippa … called 49s.com or something like that … can you send me the link to that site? thanks for the info .. i’ll post a 5 star review on Itunes tonight!!

    • Bobdak, we put the sites through a pretty vigorous process. There’s no guarantees in life, but I can tell I personally look at these sites and review the content, links, revenue and seller. If it’s not a site I would buy, we won’t list it.

      As for the site we were thinking of buying — stay away, very far away. As far as I can tell the Flippa listing was just a scam to get more recurring customers.

      • Justin Cooke says:

        Hey man,

        Soooo – I totally agree with Joe that we put the sites listed with us through a rigorous process. No guarantees and you HAVE to do your own due diligence, but we’re all confident about the sites we list.

        However – I REALLY like the site we were looking at for sale. I’m not sure I believe the seller – I think his earnings might be BS – but even without the earnings, there was a strategic purpose behind the purchase that we could have capitalized on.

        That being said – I absolutely wouldn’t trust the seller or the revenue/profit that was listed. I think it’s sketchy…but WE could have made it work as a drop sell for people looking for ideas to get started.

        The seller’s currently suspended so PROCEED AT YOUR OWN RISK:


  10. dennis says:

    Building the site is probably the easy part.

    Are there already plans to rank them / maintain rankings by building links?

    • Justin Cooke says:

      Hey Dennis,

      Sorry if we weren’t clear. We won’t be building the sites – we’ll be taking over already built/established sites and then putting together and implementing a growth strategy. (Added content, linkbuilding, paid traffic, tested monetization methods, etc.)

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