Why I Now Think Flipping Is A Bad Idea
Not too long ago I was a flipper. But a flipper I am no longer. Here’s why.
When you flip a site, you lose all the equity in the site. You lose the domain name, you lose the age of the domain, you lose the content, you lose the audience, you lose the design, you lose the potential. Did you read that last one? You lose the potential.
As owners of websites, we need to train ourselves to see the potential value in sites, 3, 5, 10 years down the road. Of course the entire landscape of the internet can change during that time, but if you’re in the game, you adapt to the changing landscape and by owning online assets, you have a leg up on anyone just getting into the game.
When you go to college, you are investing in the acquisition of skills that you hope will pay for themselves in the future. There’s a latent value in the skills you acquire in college. The value is not realized right away. The same goes for investments. The most successful investors tend to be those who buy investments in companies that they believe have the best long term potential for return on equity. The point here is that the value of a college education or the value of an investment lies, to a large degree, in the latent power that is unleashed over time. Similarly, there’s a latent value in the up front work you put into a website.
A lot of my success on the web is attributable to piggybacking off the hard, up-front work of others. There’s real upside in monitoring the web for undervalued sites being sold by individuals who are either tired of running their site, or looking to move onto the next project. Usually, these are newer sites that haven’t been fully tapped for their potential.
I bought a site last June for $500 from someone who was looking to flip. I’ve now made over $7000 off that site. When I started to get burnt out on the site, I found a writer to maintain it (which cuts a little into the profits but not much) and I have no plans of getting rid of it.
The thing about the internet is that it still has tremendous upside potential. Lots of people say to themselves “If only I had gotten into the game 10 years ago.” But what we should be reminding ourselves consistently is that “10 years from now, people will be wishing they got in the game when I did.”
The value of internet real estate, in my assessment, is going to keep going up over the long-term. So my recommendation to anyone starting out today is to keep building, buying, holding and monetizing. Build your portfolio, acquire leverage, and watch your investment compound as internet usage becomes more and more pervasive around the world.
The one qualification to this is that you should focus on web properties that you think have real value.
Related Articles:
- Not all deals are made with cash
- Create Your Own Summer Job
- Flipping blogs
- Writer’s block
- Why I Didn’t Use Credit Cards In College
[…] With all this said, I don’t think I’ll be flipping websites much. Ryan at College Startup has posted an article about why he now thinks flipping websites is a bad idea. Basically, his points are the same reasons you might buy a website in the first place. The main reason he advocates not selling the websites, though, is because of the potential value. […]