Here at Tamebay we love marketplaces and so it was interesting to find a marketplace for selling businesses and that’s exactly what Flippa is. We spoke to Blake Hutchison, CEO of Flippa, to find out how the marketplace works, why someone would sell their business and how to estimate what your business might be worth.
While you can sell any type of business of Fippa, including online business, blogs, domains, affilate sites, ecommerce stores and even apps, naturally our ears pricked up at the news that you could sell your marketplace business such as an Amazon FBA store. We asked Blake to tell us more:
What is Flippa?
Flippa is the world’s leading marketplace to buy and sell digital real estate. Buyers and sellers meet on the platform to trade websites, ecommerce stores, SaaS businesses, apps, and other online businesses.
Our mission is simple. It is to give every business owner a pathway to exit. Consider us the investment bank for the 99%.
How does Flippa work?
It’s an end-to-end experience. Online business owners can value their business/asset, connect with buyers and ultimately sell.
And, buyers are looking for assets that they can either own and operate or invest in and manage. With Flippa they are matched to assets and find a pathway to accelerated and outsized returns.
Why do people sell their business?
There are a number of reasons. These are the most common:
- To realize asset value and/or divest. Digital real estate is increasing in valuation. Selling is a real option and an exit is the fastest pathway to realize asset value.
- To reinvest and diversify. Sellers could be buying property, shares, or even another digital asset.
- To divest and free up funds. Like any asset class, they are tradeable and as such, can be divested to free up and/or relieve cash flow challenges.
Can you sell an Amazon or eBay store and how does it work?
Yes. This happens daily and across all levels. Like selling any online business you have a higher likelihood of selling when you have a strong financial performance history, you are priced in line with market expectations and the business is fit for takeover. With an Amazon or eBay store, you will need to transfer ownership of the store and this can be arranged via Amazon directly. You will need to prove that the Amazon store and related assets have or will change ownership.
How many Flippa buyers want FBA stores?
At any given time we have around 3,000 buyers looking for Amazon stores specifically. The total budget set aside for Amazon store acquisition has ballooned recently to over $1bn.
What is the average return from investment?
We would expect that you can achieve a 20-40% return on your investment. This depends on the age, maturity, and current traffic to revenue ratio.
What is the value of your online business?
This depends on a number of factors. Our algorithm takes into consideration the business model, age, performance, growth rate, and category. Try our valuation tool here.
What makes Flippa better than its competitors?
Flippa has the world’s largest buyer base, we have multiple and flexible ways of selling, and we offer market-leading success fees.
What info do you need to list?
When listing an asset you will need a minimum 12-month financial history (revenue and expenses) and key operational detail. The listing process is straightforward – it will take approximately 45 minutes to build an outstanding listing.
If you are curious, check out what your online business is worth here.