Due Diligence On Website Buyers

I’m currently selling one of my domains on Flippa. I have the luxury of knowing 2 of the bidders, who I feel I can trust. A new bidder has entered the scene, though, and I don’t know him. The question arises: what due diligence can you do on a website buyer?

In my case, all the only information I have about him is his Flippa user name. Let’s see what we can do to allay our fears about non paying bidders.

The first port of call must be the bidder’s past activity on Flippa. Unfortunately for me, although this bidder registered in 2005, he has no activity recorded in Flippa.

I did a search on Google for his user name and found a listing he’d created on bestwayclassifieds.com. The listing advertised a site he was promoting and gave the URL. At this point I didn’t know whether my bidder owned that site, but I did a search for the site on http://www.domaintools.com anyway.

From that search I found the owner of the domain. The owner had only given their first name – and it matched the name the bidder signed his PM with! It’s looking good, but it’s not concrete.

The domaintools listing also gave the address of the registrant so I performed the following search on Google to try and find other sites owned by the same registrant:

“address line 1” site:http://whois.domaintools.com

This search returned one other site.

I PMed the bidder and asked if he could tell me any other sites he owned. He gave me the first one I’d found in domaintools. Bingo! Now I have a reference point. I know the name (OK first name!) of the bidder, two sites he owns and also his address.

Of course, this isn’t enough information for me to feel confident that I’m not about to get scammed, but at least I know the bidder is being honest and also isn’t some schoolkid tyre kicker. Through the PM conversation I had with him I know at least he has a brain in his head and he seems to have his wits about him. Again, that’s no gurantee that he won’t rip me off, but it does allay my fears a little.

I will be, after all, performing the transaction through escrow.com, and it’s only the domain that will get transferred here (not a full website), so I think I’ve got myself covered. Read more about the reasons why you shouldn’t feel secure about transferring a website using escrow.com.

When selling on Flippa, or any other website marketplace for that matter, you need to take into account the time zones that bidders operate in. I’m in the UK and it’s 23:38 when I write this, but the bidders on my auction live in the US. It’s my bedtime now, but for my bidders it’s the middle of the day. That means that they will be bidding while I’m asleep and won’t have my fatherly hand to guide them. And each time a new bid comes in, the auction end time extends by 3 hours! Bugger! With any luck, a bidding war will start and it will still be raging when I wake up tomorrow :)