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Website negotiation and buying process

We get questions about what the actual process is to purchase a website (and many sellers are confused since this dates back to the origins of mergers and acquisitions). It’s a business like any other; the typical process applies for purchasing. For this example, we are going to use a broker scenario where they are the middle-man to the transaction.

 

Summary of the process:

  1. Broker emails out the listing(s), or you find a business through networking and outreach.
  2. Get/Request the prospectus if there is one.
  3. Do basic due diligence on the site and make sure it passes your “rules.” This includes running through SEMRush if you have it, and any keyword research you can perform.
  4. Customize and send a Letter of Intent (LOI) with your purchase price, terms, and offer. Try to spell out the main details that will be a negotiation point for the business sale.
  5. Do some negotiations back and forth probably through email; it may be quicker to jump on a phone call with all parties. This can happen before sending the LOI as well.
  6. Seller signs the LOI and returns to you.
  7. Do the complete due diligence – mainly financials, look through tax returns, P&L’s, sales data, etc. to make sure it all adds up. In the LOI you specified how much time is allotted for this, and they are not allowed to pursue other sellers (they can have a backup list but not sell it out from under you). This is where you are really looking into who the seller is as well, are they responsive? Are they willing to help you make this business work? If they go dark during due diligence, you can still walk away. Do not get too invested in a business at this point.
  8. Submit the purchase agreement with funding and closing dates, make sure financing is in place to meet the closing date. The purchase agreement should nail down specifics regarding training, payment dates, anything you think is important to finalize the deal. Often there is a deposit paid at this point that is non-refundable. This means the buyer is able to perform, and the seller gets the deposit if not.
  9. Close, fund, and post-sale transition. There is where the work beings, getting the business under your control. The seller should have documentation to help with this.

Many inexperienced buyers or sellers might want to skip right to the purchase agreement, but the issue is you don’t have any recourse if the financials don’t work out. You can add that language to the agreement, but that adds unnecessary complexity.

Interested in selling your business? Contact us and we can talk.

 


Keyword research for a website

When purchasing a website, you want to have free traffic from search engines (organic traffic). To see what kind of traffic that is, we want to determine what keywords the site ranks for. There are buying keywords and just research keywords. Having a nice mix of both is great, but the money is when people are looking to make a purchase (end of the purchase lifecycle).

A long time ago, Google Analytics gave us the keywords people used to find a website. You could just share the analytics accounts and be golden. Now that has moved into the search console, which is more of a private area. So how do we find the keywords a site ranks for without getting access to their accounts?

Well, our reliable tool SEMrush.com can do it! They offer a free trial if you want to test it out. There are also a bunch of other similar services (the same services you use to check backlinks). Most of them are paid services as you can imagine this data is worth real money.

To start with, let’s see how many pages Google has indexed for our site. Type in “site:airbnb.com” to see what pages they list (replace airbnb.com with the domain you want to research). Our search came back with over 15 millions results, wow! Approbo.com, a much more manageable <20 pages. With millions of pages, we can expect them to rank for quite a few keywords.

Let’s log in to SEMrush and type in our domain name, and click “top organic keywords” down near the middle; it brings you to this screen:

keyword research with semrush

 

That is a lot of information, but we can see it is sorted by keyword volume which is nice but doesn’t tell us how we rank for keywords. So first step is to sort by the position, click “Pos.” One interesting thing to note, Airbnb is so popular they rank for www which is crazy! Currently, they are at result number 47.

SEMrush is estimating their organic traffic at 3.8 million dollars! That is a gift that keeps on giving.

Now sorting by position:

website keyword research semrush

 

We can see they are ranking for a good amount of Long tail keywords, things like “cabins near tucson az” which doesn’t get many searches, but they are the first result (besides a bunch of ads of course).

The best way to massage this data is just to export it (click the export button) which lets you sort however you like inside excel. What we are really looking for is keywords that have a high number of results and high position ranking. NOTE: Not all keywords are alike. There are buying Keywords, research keywords, and what some call consideration keywords. These all target different things in the buying lifecycle. In the example above you can see “hire a beach hut”, these are buying triggers as users already know what they want, just trying to find it.

Another keyword like “Traditional townhouse” is a research keyword, they are looking for information about what a townhouse is, what they look like, etc. Those are nice but far away from being an actual purchase. These are great candidates for ad retargeting which we will write about soon!

 
Contact us to have a quick seller consultation and we walk through your business