Fraud in Website Acquisitions

4 Website Due Diligence Mistakes That Burn Buyers Daily

Due diligence is a tricky subject and one that can’t be very easily taught or learned, making many buyers choose to leave it to professionals instead. But there are a number of simple but crucial things that everyone who’s thinking of buying a website or an online business is better off knowing themselves. In this article, I’ll cover the 5 arguably most common mistakes that are often made by buyers new to the industry and some experienced buyers alike.


Mistake #1 – Taking Traffic and Revenue Proofs at Face Value

This is perhaps the most common mistake made in the industry, although primarily for smaller purchases that are facilitated by marketplaces, rather than brokers – but also some less established or less legitimate brokers.

I’ve said it before and I’ll say it again – NEVER trust a screenshot or a video walkthrough, unless the purchase price doesn’t exceed what you’d spend on dinner tomorrow. There should be absolutely no exceptions to this rule, ever.

The reason? Because it takes someone with basic computer knowledge no more than 15 minutes to put together convincing (and I mean convincing – ones that would fool a seasoned expert) package of screenshots and video proofs showing — whatever they want them to show.

If there’s any interest in the comments then I’ll post a follow-up video post showing and proving how blatantly easy it is to put together “proofs” that appear to accomplish the majority of listings – even 5- and 6-figure ones – throughout online marketplaces.

So what should you do instead?

Always insist on live verification. And I don’t mean meeting with the seller face to face as this would, in most cases, be unfeasible. Most of the times either a simple Skype call accompanied by screen sharing (Skype’s built-in feature), or alternatively a traditional call combined with a screen sharing solution, such as ScreenLeap or TeamViewer – there are lots of good and free solutions out there – will do the trick just fine.

What you’re looking for is a couple of things:

  1. Live Account Access. You want the seller to walk you through their revenue accounts, one by one, to demonstrate that the claimed revenue actually exists.
  2. Log-in sequence. A crucial part of a live verification session is having the seller “click around” within the sites that are being demonstrated, as well as go through a full log-out / log-in sequence. It’s very easy to artificially change some parts of a site and make them appear as the scammer wishes, but it’s much more difficult (albeit not impossible) to replicate the whole login process.
  3. Prompting the unexpected. Whenever I perform revenue verification myself, I make sure to prompt the seller to show me something that wasn’t talked about before, in order to try and catch the scammer off-guard. This can be anything – from a remote and irrelevant part of a site (e.g. “Please show me the ‘profile’ section in your PayPal account”) to random periods.
  4. Double Verification. Always aim for double verification when it comes to revenue. Double verification means that you’ll follow the money as it flows, e.g. for a site that receives its revenue via PayPal, you’ll want to see both the PayPal account, as well as the bank account into which these payments are withdrawn to make sure that it belongs to the same person.

For traffic verification, it’s a little easier. Simply request the seller to grant you live guest access to the site’s Google Analytics and you’re all set. Many sellers (/scammers) tend to come up with all sorts of excuses for why this isn’t possible but during my years in the industry, having overseen several hundred transactions, I’m yet to encounter one legitimate one for the lack of the ability to add me to Google Analytics as a guest user.

No Google Analytics? Ask the seller to put it up, let it gather data for a few days, then verify. Again, no exceptions.


Mistake #2 – Assuming that Revenue Means Site Revenue

I’ve written about this one already about a year ago so let me just give you a quick summary.

Many scammers out there are able to run their ‘businesses’ because they happen to have one (legitimate) revenue generating site, the earnings of which they present as the earnings of the multiple sites that they sell each month. The danger is that since the *person* does have legitimate earnings, they’re more than happy to go through live revenue verification with you and demonstrate the earnings – only the earnings are not generated by the site that’s being sold and will therefore be zero the moment the site is taken over.

So what should you do instead?

  1. Always try to establish a clear link between the revenue account and the site in question.
  2. Make sure that traffic levels correspond to revenue levels. If it’s quacks like a duck ……
  3. Perform a thorough background check on the seller.

Check out my earlier write-up about this for some more specific pointers and explanations.


Mistake #3 – Not Verifying Traffic Sources

Another easy way to fall prey for scammers is naively assuming that all traffic is good traffic – not so.

When analysing your acquisition candidate’s traffic details, it’s extremely important to pay close attention to traffic sources, and make sure that they’re:

  1. Verifiable. This means, essentially, to stay away from sites that have an abnormally large share of Direct Traffic, which by its nature is in no way verifiable.
  2. Sustainable. Does the site that you’re looking at get most of its traffic from a single Buzzfeed or Reddit post? Run! Does the site get a large share of its traffic from another site who’s linking out to it out of ‘goodwill’ (and may even be owned by the same person)? Run faster!

Think of traffic sources like the physical location of your Bricks & Mortar business. Having your cupcake shop in the middle of a busy street is great, as the street is likely to stay busy for years to come. But having it in next to the (remote and otherwise rarely used) football stadium where the next big one-off game is going to be held? Great for one night – after that, bad news.

I’ve also blogged about this topic in greater length – see here: How Traffic Sources Affect Website’s Value and Longevity


Mistake #4 – Not Verifying Organic Traffic

Some scammers make a good living out of selling sites that get all its traffic from paid sources (such as Google Adwords), but passing it on as organic traffic.

Those sites typically make very little to no money and most of the times generate a loss if ad costs were to be deducted, but for the scammer it’s good business, as they’re claiming that the site gets organic traffic and has no ad costs.

And what’s worst – Google Analytics is their accomplice!

What many people don’t know or realise is that Google Analytics doesn’t distinct clicks that originate from Google’s organic search results from clicks that come from paid Google AdWords ads, unless the Analytics and Adwords accounts are linked . Because of this – sites like those that I’ve described above, often show up as if they were receiving lots of organic traffic, whereas in reality it’s all paid AdWords traffic.

How to verify organic traffic

Fortunately, verifying whether traffic that shows as ‘Google/Organic’ is truly from search results is relatively simple. Personally, I use a combination of 3 checks/tools for this:

  1. allows you to punch in a random web address, and it will show you the likely organic traffic levels (and a list of keywords) that the site receives. Note that SEMRush is not 100% accurate, but it’s usually not too far off either – so if SEMRush shows virtually no traffic or ranking but Google Analytics shows loads then it’s highly likely that something is wrong.
  2. is a neat little tool that allows you to check whether a particular site is advertising on Google Adwords, as well as estimate their approximate ad budget. Even though the budget figure that KeywordSpy shows is often quite far off from the reality, one thing is certain – if KeywordSpy shows ANY ad spend then ad spend exists. Meaning that if the seller is claiming no ad spend then you should do yourself a favour and more on to the next acquisition.
  3. Google is the best tool of all. Simply go to Google and search for the keywords that the site is likely to rank for, trying to find whether the rankings exist or not. Then head over to Google Keyword Planner to estimate the ‘average monthly traffic volume’ for those keywords.

There are also other methods of verifying organic rankings, such as connecting Google Analytics to Google Webmaster Tools, but that’s not the scope of this article and won’t apply retroactively.

Over to you

I truly enjoy a good discussion so do let me know in comments if you have anything to add to the above.

Also let me know if you’re keen to see a ‘live fake revenue’ demonstration and I’ll put it together for the next post!

P.S. I’ve also just launched a (rather self-destructive) Free Website Valuation Service, as well as published 13 thorough Website Broker Reviews, covering the majority of the brokerage world! Check them out and let me know of your thoughts. Any feedback is hugely appreciated.

Share this!

42 Comment

  1. Somebody necessarily help to make severely articles I’d state.
    That is the very first time I frequented your web page
    and to this point? I amazed with the analysis you made to create this particular
    submit incredible. Magnificent job!

  2. Hello! I just wanted to ask if you ever have any trouble with
    hackers? My last blog (wordpress) was hacked and I ended
    up losing many months of hard work due to no back up.
    Do you have any solutions to protect against

  3. Peculiar article, exactly what I was looking for.

  4. My partner and I stumbled over here different web page and thought I
    might check things out. I like what I see so i am just following you.
    Look forward to finding out about your web page yet again.

  5. Sweet website , super design, really clean and employ friendly.

  6. I used to be able to find good advice from your content.

  7. I absolutely love your blog and find most of your post’s to be precisely what I’m looking for.
    Does one offer guest writers to write content in your case?
    I wouldn’t mind creating a post or elaborating on a number
    of the subjects you write concerning here.

    Again, awesome web site!

  8. Hello to every single one, it’s really a nice for me to pay a quick visit
    this website, it consists of priceless Information.

  9. Hi, I check your blogs daily. Your humoristic style is awesome, keep it up!

  10. I visit day-to-day some blogs and blogs to read content, however this blog offers feature based articles.

  11. It’s awesome to visit this web page and reading the views
    of all mates about this paragraph, while I am also eager of getting familiarity.

  12. I read this article completely on the topic of the
    difference of most up-to-date and preceding technologies, it’s
    remarkable article.

  13. Nice blog here! Also your site loads up very fast!
    What web host are you using? Can I get your affiliate
    link to your host? I wish my website loaded
    up as fast as yours lol

  14. Hi there, its fastidious piece of writing on the topic of media print, we all be familiar with media is a fantastic source of data.

  15. Hi! I’ve been following your blog for a long time now and finally got the bravery to go
    ahead and give you a shout out from New Caney Tx!
    Just wanted to mention keep up the good job!

  16. This is the perfect webpage for everyone who wishes to
    understand this topic. You understand a whole lot its almost hard
    to argue with you (not that I personally will need to…HaHa).
    You certainly put a fresh spin on a topic that’s been written about for years.
    Great stuff, just great!

  17. This is the perfect webpage for everyone who wants to understand this topic.
    You know a whole lot its almost hard to argue with you (not
    that I actually will need to…HaHa). You definitely put a new spin on a subject that has been discussed for ages.

    Great stuff, just excellent!

  18. I got this web page from my pal who informed me on the topic of this site and at the moment this time I am browsing this web page
    and reading very informative articles or reviews at this place.

  19. This page certainly has all the information and facts I wanted about this subject and didn’t know who to ask.

  20. I read this article fully on the topic of the difference of hottest and earlier technologies, it’s amazing

  21. I was suggested this blog by my cousin. I’m not sure whether
    this post is written by him as nobody else know such detailed about my difficulty.
    You’re amazing! Thanks!

  22. I’m extremely impressed with your writing skills and also
    with the layout on your weblog. Is this a paid theme
    or did you customize it yourself? Either way keep up the nice
    quality writing, it’s rare to see a nice blog like this one these

  23. I am sure this paragraph has touched all the internet visitors,
    its really really pleasant piece of writing on building up new weblog.

  24. Remarkable things here. I’m very glad to see your article.

    Thank you a lot and I am having a look ahead to touch you.
    Will you kindly drop me a e-mail?

  25. With havin so much content and articles do you ever
    run into any problems of plagorism or copyright violation? My website
    has a lot of exclusive content I’ve either
    written myself or outsourced but it appears a lot
    of it is popping it up all over the web without my permission. Do you know any
    techniques to help prevent content from being
    stolen? I’d definitely appreciate it.

  26. I think the admin of this web page is genuinely working hard for his web site, because
    here every material is quality based information.

  27. My spouse and I absolutely love your blog and find
    most of your post’s to be what precisely I’m looking for.

    Does one offer guest writers to write content in your case?

    I wouldn’t mind producing a post or elaborating on a lot of the subjects you write in relation to here.
    Again, awesome blog!

  28. Hello there! Do you know if they make any plugins to safeguard against hackers?
    I’m kinda paranoid about losing everything I’ve worked hard
    on. Any recommendations?

  29. It’s the best time to make some plans for the future and it’s time
    to be happy. I’ve read this post and if I could I want to suggest you few interesting things
    or tips. Perhaps you can write next articles referring to this article.
    I wish to read even more things about it!

  30. Hi my family member! I wish to say that this article is amazing,
    great written and come with approximately all significant infos.
    I would like to look extra posts like this .

  31. Simply desire to say your article is as astonishing.
    The clarity in your post is just great and i can assume you’re
    an expert on this subject. Well with your permission let me
    to grab your feed to keep updated with forthcoming post.
    Thanks a million and please continue the gratifying work.

  32. Wonderful beat ! I would like to apprentice whilst you amend your site,
    how can i subscribe for a blog website? The account helped me a acceptable deal.
    I were tiny bit familiar of this your broadcast offered brilliant
    clear idea

  33. Hey! This is my first visit to your blog! We are a group of volunteers and starting a new project in a community in the same niche.
    Your blog provided us useful information to work on. You have done a marvellous job!

  34. Yesterday, while I was at work, my cousin stole my iPad and tested to see if it
    can survive a 40 foot drop, just so she can be a youtube sensation. My iPad is now broken and she
    has 83 views. I know this is totally off topic but I had to share
    it with someone!

  35. Hello there! I simply wish to offer you a big thumbs up for your great information you’ve got right here on this post.
    I am coming back to your site for more soon.

  36. This is very interesting, You are a very skilled blogger.
    I have joined your rss feed and look forward to seeking more
    of your excellent post. Also, I have shared your website in my social

  37. Saved as a favorite, I really like your site!

  38. Hey just wanted to give you a brief heads up and let you know a few
    of the pictures aren’t loading correctly. I’m not sure why
    but I think its a linking issue. I’ve tried it in two different internet browsers
    and both show the same outcome.

  39. First off I want to say terrific blog! I had a quick
    question which I’d like to ask if you don’t mind.
    I was curious to know how you center yourself and clear your mind before writing.

    I’ve had trouble clearing my mind in getting my ideas out there.
    I truly do enjoy writing however it just seems like the first 10 to 15 minutes are wasted simply just trying
    to figure out how to begin. Any suggestions or hints? Appreciate it!

  40. Helpful info. Lucky me I discovered your web site by chance, and I am shocked why this accident didn’t took place in advance!
    I bookmarked it.

  41. Aw, this was an extremely nice post. Taking a few minutes and actual effort to generate a superb article… but what can I say… I procrastinate a whole lot
    and never seem to get anything done.

  42. What’s up mates, good piece of writing and good urging commented at this place, I
    am actually enjoying by these.

Leave a Comment