Want to Sell Your Online Business For Top Dollar? Learn What Costly Mistakes To Avoid and How To Prep Like A Pro from Flippa’s Top-Rated Website Broker
If you’re thinking about selling your website, you probably have one big question: How do I get the highest price possible?
That’s why I invited Joe Burrill and Nat, top-rated website brokers with over $6 million in website sales.
Today, they’re going to share insider tips that’ll help you sell your online business for top dollar, including:
- The #1 mistake website owners make when selling
- The 6-month prep plan to get the highest sale price
- How to handle buyer objections and sell at a premium
- The strategy that helped students sell websites for way more than expected
Watch this interview, then bookmark it so when it’s time to sell your online business, you’ll know how to sell for top dollar.
Plan Your Exit Strategy At Least 3-6 Months in Advance
Contrary to what many website owners believe, selling a website for maximum value doesn’t happen overnight. According to Joe, preparation is everything.
“When you are beginning to think about selling, the process is going to be roughly between three and 12 months. It’s at that point when you’re thinking ‘I need to sell’ that you should do your best to maximize your profits without jeopardizing the business.”
Most website valuations are based primarily on profit, so anything you can do to increase revenue or decrease expenses in the three to six months before selling can significantly impact your final sale price.
This preparation window is substantially shorter than traditional brick-and-mortar businesses, which typically require 12 months or more of preparation, but it’s still crucial for online ventures.
The mistake many sellers make is approaching brokers with no preparation whatsoever. While brokers like Joe and Nat can help with the preparation process, coming to them with a website that’s already been optimized for sale will yield better results. For serious sellers looking to maximize their price, a six-month preparation window is ideal.
Think of this preparation phase as setting the stage for potential buyers. During this time, you should focus on cleaning up your financials, streamlining operations, and documenting processes – essentially making your website as attractive as possible to potential buyers.
This is the type of advice Joe gave to one of our graduate students, Yvette, who he helped sell her simple Pickleball website for over $15,000.
Continue Operating Your Online Business as if You Were Going to Keep It
One of the most common mistakes website owners make when selling is mentally checking out too early. As Nat points out, many sellers make the critical error of disengaging from their business once they decide to sell.
“Continuing running the business the same way they have been is crucial,” Nat emphasizes.
“We see a lot of people that just go, ‘I’m finished with it,’ and then they take their hand off the wheel, drop the ball, and it just starts going down from there. Or they don’t order more inventory, and the stock starts selling out.”
This disengagement can be devastating to your sale price. Potential buyers are looking at recent performance metrics, and if they see declining sales or neglected operations, they’ll either walk away or significantly lower their offers. Nat advises sellers to “keep running the business as though you were keeping it” throughout the entire sale process, which might take months.
This advice is particularly relevant for larger websites generating significant income. Even if you’re emotionally ready to move on, maintaining your commitment to the business until the sale closes is essential for maximizing your return. This means continuing to create content, manage inventory, engage with customers, and handle all other aspects of the business with the same dedication you’ve always shown.
Be Honest and Transparent When Selling Your Website
In the world of website sales, transparency isn’t just an ethical choice – it’s a strategic advantage. Joe emphasizes that sellers shouldn’t shy away from highlighting weaknesses and threats to their business.
“A lot of sellers think that they only need to show the highlights and the best. But ultimately when it comes down to it, when you have a buyer who’s seriously interested, they’re probably going to see all of that not-so-good stuff anyway.”
By proactively addressing potential concerns, you generate a level of honesty and trust that sets you apart from other sellers. Sophisticated buyers, particularly those looking at websites priced at $50,000 and above, conduct thorough due diligence and will uncover any issues you attempt to hide.
This doesn’t mean dwelling on problems, but rather acknowledging challenges and, ideally, explaining how you’ve addressed them or how a new owner might tackle them. For example, if there’s been a downturn in traffic or sales, explain the context and any steps you’ve taken to address the issue.
As Joe points out, buyers will have their own objections and concerns, so being upfront about potential issues creates a foundation of trust that can actually facilitate a smoother sale process. For online businesses where every metric is tracked and measurable, transparency isn’t just recommended – it’s essential.
Have Responsive Communication with Your Potential Buyers
When your website first hits the market, expect a flurry of activity. Both Joe and Nat emphasize that the first few weeks after listing are critical, with the first month typically generating the most interest.
“There’s usually a lot of buzz at the start,” Nat confirms. This initial period is when brokers send out emails to their lists and spread the word about the new listing, resulting in the largest influx of inquiries.
Given this early surge of interest, sellers need to be exceptionally responsive during this period. Joe stresses the importance of quick replies to potential buyers, ideally within 24 hours. Delayed responses can cause buyers to lose interest and move on to other opportunities.
This level of responsiveness requires commitment from the seller, especially when working with a broker who may need additional information to address buyer inquiries. As Joe explains, “As a broker, it’s harder because there are some questions that we need advice or some input from the seller before we can properly respond.”
For sellers, this means being readily available, particularly in those crucial first few weeks.
Schedule your listing at a time when you can dedicate attention to the process, not when you’re traveling, overwhelmed with other commitments, or otherwise unable to engage with potential buyers.
Be Open to Creative Deal Structures: Beyond the Cash Offer
In today’s market, flexibility in deal structure can be the difference between a failed listing and a successful website sale at premium prices. Joe and Nat highlight several creative approaches that can make your website more attractive to buyers while potentially increasing the final sale price.
1. Seller Financing
Seller financing (also called vendor financing) is the most common alternative to all-cash deals. In this arrangement, the buyer pays a portion upfront (typically 50-70%) and the remainder over a 6-12 month period. This approach benefits buyers by allowing them to use capital to grow the business before making full payment, but it can also benefit sellers.
“A way to potentially increase the price is if you get a low offer from a buyer, you can say, ‘Well, if I’m willing to offer seller financing, then would you be able to increase the overall price?’ So, it’s a way to negotiate on both sides.”
While seller financing is more common in the American market than in Australia, it’s becoming increasingly prevalent worldwide. For sellers concerned about getting paid the remaining balance, using a formal agreement and escrow service can provide protection.
2. Earn Out Based on Conditions Being Met
Another option is the earn-out, where a portion of the sale price is contingent upon specific conditions being met. Joe provides an example: “We’ve had one fairly recently where the Mediavine account [an advertising platform] was maybe not going to be transferred, or it might not be approved under the buyer’s account. We separated a portion of the price away, and only had that money be released if the Mediavine gets approved.”
3. Earn Out Based on Performance
Earn-outs can also be based on performance, with additional payments made if the business maintains or exceeds certain metrics post-sale. When structuring earn-outs, it’s advisable to base them on easily measurable metrics like sales rather than profitability, which can be more subjective and potentially contentious.
The Advantage of Working with An Experienced Website Broker
Selling a website without professional help might seem like a way to save on commission, but Joe and Nat make a compelling case for why brokers are worth the investment.
“The biggest thing is experience,” Joe explains.
“We take a lot off your plate as well. Anyone who has not done this before should have a broker to help them through the process because there’s a lot of steps.”
Brokers bring several critical advantages to the table. First, they handle the substantial legwork involved in preparing the business for sale, creating detailed listings, corresponding with potential buyers, and managing the due diligence process. They also screen potential buyers to ensure they’re legitimate and serious before involving the seller.
Perhaps most importantly, brokers serve as emotional buffers between buyers and sellers. Nat highlights this often-overlooked benefit: “A lot of the time, it kind of takes pressure off, because there can be some friction between buyer and seller. And we take that on. We’re the person that takes the friction and kind of smooths the relationship.”
This intermediary role is invaluable because selling a business – even a small website – can be an emotional process. Owners who try to handle negotiations themselves often let emotions cloud their judgment, potentially jeopardizing deals or accepting lower offers than necessary.
Additionally, established brokers bring extensive networks of potential buyers, significantly expanding the pool of prospects beyond what an individual seller could reach.
Experienced website brokers can often connect with qualified buyers before a listing even goes public, expediting the sale process.
Why the Listing Description is So Important When Selling Your Online Business
At the heart of a successful website sale is the Information Memorandum (IM) – the comprehensive document that presents your business to potential buyers. According to Joe, this is their primary focus after ensuring the financial data is accurate.
“Once we get the numbers, the next most important part for us before we list the business for sale is that IM, a business description that explains the business,” Joe states. Over time, Joe and Nat have refined their approach, making their IMs more concise and impactful.
A well-crafted IM presents not just the raw data but tells the story of your business – its history, operations, market position, growth opportunities, and challenges. It includes key performance indicators, traffic sources, monetization strategies, and other critical information buyers need to make informed decisions.
The quality of this document directly impacts buyer perception and, consequently, offer amounts. It’s another reason why preparation is so crucial – creating a compelling IM requires time and detailed information that goes beyond basic profit and loss statements.
Ideally, an IM should include at least 12 months of financial data, giving buyers confidence in the consistency and trajectory of the business. This comprehensive approach to documenting your business not only attracts serious buyers but positions your website as a premium asset worth paying top dollar for.
Learn How to Grow Your Website for A Successful Exit
If you’re contemplating selling your website, the path to maximum value starts with preparation. Begin thinking about your exit strategy at least six months before you intend to list, focusing on optimizing profitability and operations during that time.
When you’re ready to move forward, consider working with an experienced broker who specializes in online business sales. Joe and Nat’s brokerage, Just Website Brokerage (justwebsitebrokerage.com), handles websites valued from $10,000 upward, typically requiring at least $500 in monthly profit.
For smaller websites or those just getting started in the buying and selling process, their advice remains invaluable: prepare thoroughly, maintain your business’s performance throughout the sale process, be transparent about challenges, stay responsive to inquiries, and be open to creative deal structures that could increase your final sale price.
By following these expert strategies, you’ll position your website for a successful sale that maximizes its value and creates a win-win situation for both you and the buyer – setting the stage for your next venture or a well-funded retirement.
And if you’re ready to learn how to grow and sell your next website for top dollar, join our free masterclass where we show you how to build, renovate and sell your website for top dollar.
