Buying An Online Business From Empire Flippers (PART THREE- MIGRATION CHALLENGES)

It's been 12 months since I closed on my 2019 purchase from Empire Flippers. Here's what happened when things started to get challenging during migration.

Jul 16, 2020

This is part THREE of this multi-part series about my 2019 Empire Flippers experience. When the other parts are available, I will come back and link them.

Part One: Backstory/WHY

Part Two: Negotiations and Closing

Part Three: Migrations Challenges

Part Four: Running the Business for 12 Months

Part Five: Takeaways/Hindsight is 20/20

Buying an Online Business Requires Many Leaps of Faith.

Once the negotiations were finished, when both parties (the seller and I) agreed to the terms, I had to wire the money to Empire Flippers to move the purchase forward.

Building anything online requires so many leaps of faith. Scammers are everywhere, poised and ready to run off with your money, leaving you feeling ashamed and guilty for being taken in.

The wire transfer was the moment in this entire experience that required the biggest leap of faith of all.

Not only was I spending an amount of money that I considered to be A LOT OF MONEY, I was sending it via wire transfer.

A method that did not afford me much protection (like you’d have if you were using a credit card or paypal).

A money transfer method not easily un-done.

And it was going to the Philippines.

To a place where I could not hope to retrieve my money if I discovered that I getting ripped off.

I had to go in person to my bank, and verbally provide instructions to my bank for how much money to send, and where to send it.

The rep at my bank faithfully followed my instructions, though I could see that every step of the way, she was questioning my actions.

I didn’t blame her, to be honest.

I was just some random girl, who walked into the bank off the street wearing battered and worn workout clothes (my daily uniform of choice), with her hair in a messy bun.

I didn’t look much like my former professional self at all (suits, heels, leather briefcase).

And I was asking her to send a pretty decent amount of money to the other side of the world.

I probably didn’t really look like someone who should be in possession of a fraction of that money.

I don’t blame her for being skeptical.

Heck, I was skeptical.

Yes, I believed in the idea. Yes, I believed that it could work. Yes, I was taking steps forward as the result of what I believed.

But look at me. With all of my belief, I was still basically doing all of it in secret.

I hadn’t told my family, or my friends.

I know they would question my actions, my decision, and my reasoning.

I figured they would try and stop me.

Not only that, but if I did fall victim to a scam, everyone I had told would know.

I feared their judgment, and public knowledge of my shame if I failed.

So I went to the bank alone, without telling anyone.

A mixed bag of skeptical and hopeful.

But even though I left no room for other people to influence me or change my mind, as I filled out the forms and signed my name, the doubts still crept in.

What was I doing?

Once the paperwork was done, the lady (older, gray haired, management level, very nice), started asking me about my wire and what I was doing with the money.

Would she try and stop me?

To keep my transaction on track, I explained as much as I could about the business I was buying to reassure her that I wasn’t buying weapons or drugs, or purchasing a home for a troubled Nigerian prince.

But as we talked, and I described the benefits of completing the transaction, the person who was probably more reassured was me.

As I reminded myself of the various reasons for purchasing an online business, the rising doubts fell away, and once again, I felt confident and excited about my new venture.

When the time came to pass the point of no return (when she would hit the “send” button), I smiled at her and told her to go ahead.

When the transaction was done, she smiled and asked me to come back into the bank in six months to provide her with an update, even going as far as giving me her card with her direct line.

She said that she was curious about my business venture, and wanted to hear if I panned out as well as I anticipated.

In all honesty, I am not sure that she expected to hear a success story.

Migrating My Sites=New Challenges Resulting in Learning

If you haven’t bought a site (or any sort of online business), one of the initial major headaches of buying a website (or a portfolio of them) is migration. This is one of the major benefits of using a broker with an experienced team. They can handle all of the changeover tasks (or hold your hand, step by step), such as:

Transferring domain names
Transferring hosts
Gathering all passwords and login information
Transferring social media accounts
Changing out the ad units
Changing out the affiliate links
And all of the rest, whatever it is, depending upon the business.

In my case, within a short amount of time after I wired the money, I started to receive contacts from the migration team, and I no longer had much to do with the sales team.

Things were a little chaotic at first. I received messages from a few different people about getting the migration process started who I had never talked to before, and they were asking for login and password info. This caused me some anxiety.

Soon though, I was contacted by the EF person who was in charge of overseeing the migration. This gentleman was very friendly, and had an actual checklist of what was going to happen and in what order, which would have been a nice place to start.

Once I was working with a consistent group of people, I was relieved to have a team helping me with migration, because at that time last year, I had only migrated one site myself and I gave myself tons of gray hairs in the process.

This package was a small portfolio of sites (six in total). These were hosted on two different hosting services: Dreamhost and WPX. At the time of purchase, I didn’t have a strong preference as to which hosting I liked or wanted to use. So I just allowed them to transfer the hosting accounts to my name.

In hindsight, I wish I had known more about the hosting platform I wanted to use, and I would have had them take care of migrating them to my hosting of choice, instead of kicking the can down the road until this year or next, and having to migrate them to another host on my own.

But since I didn’t have a strong preference, they made the decisions about what would happen with hosting and I didn’t know any better to have an opinion about it.

The same is true with domain names. I had only used GoDaddy to purchase domains, but the seller was using Namecheap. So I also ended up with all my domains in a Namecheap account.

This wasn’t a big deal to me (and still isn’t) but I realize now that if I had expressed a stronger preference during migration, that I could have avoided having so many different new accounts.

People who are unfamiliar with buying a business through a broker like Empire Flippers might wonder about what happens if a site doesn’t start earning, or doesn’t earn as much as it did for the seller.

Empire Flippers (and other brokers may do this to, or it is something you can request if you are doing a peer-to-peer deal) has an “inspection” period. It is spelled out in the contract. But basically, once everything is transferred and set up, everyone just watches the business, operating as normal, to see if the business will earn at least 50% of the revenue that was represented in the listing.

For example, if a site is listed for sale as earning $1,000 per month, it needs to be on track to earn at least $500 per month to pass inspection.

But one thing that new buyers might find confusing is that the inspection period isn’t a month (or it wasn’t when I bought). For me, it was 14 days. A business that was listed at $1,000/month would only need to earn $250 during the inspection period in order to pass the inspection (as it is assumed that the business would earn $500 for the month).

If the site does not earn enough to pass inspection, the buyer can back out of the deal, or the parties can renegotiate the sale price of the business.

In most cases, you can probably come to an agreement with the seller about the percentage the business needs to earn during the inspection period, even if you are using a broker like Empire Flippers or some other established company.

I didn’t know that much about the inspection period, or really think to make the earnings % during inspection a priority during negotiations.

In hindsight, that’s something I wish I had paid more attention to. If I had really thought about it, I’m not sure I would have been as interested in a business that only had to earn 50% to pass inspection.

Things were going smoothly with migration until it was time to get Adsense ads set up.

I had my own Adsense account, having learned early on that I wouldn’t be able to apply for a new Adsense account with a website that had already been used/approved for Adsense.

(This was another reason why I started my Adsense case study site from scratch in April of 2019).

With an Adsense account of my own in good standing, we all assumed that everything would be hunky dory.

Very quickly the team had the seller strip off all of the Adsense code and ad units from the four sites monetized with Adsense, and then submitted the four sites in my account for approval.

No one had any idea how long this would take. This is a good reason why people need to build in some time into the budget for the business to be earning $0. No one has any control over ad networks and their timeline or process. This is especially critical if the buyer is using financing to complete the deal and is reliant upon incoming revenue right away to meet the initial payments on the loan.

But within two weeks, we’d received word back from Adsense on all of the sites that we had submitted.

Unfortunately, not all of the sites were accepted, despite the fact that they’d been approved for Adsense and running Adsense ads just hours before submitting them in my Adsense account.

The migration team handled all of this. They worked with the seller to troubleshoot the problems (which were simple ones), and resubmitted the ones that had been rejected.

This went on for a while. One site was resubmitted a few times before it was accepted. But in the end, only three of the four sites were ultimately approved to run ads. The fourth site was a small one, which did not have a ton of content, is which is probably the reason why it did not get approved again.

As it earned only a little each month, I made the decision to move forward with the three other monetized sites to see if the package could still pass inspection, and figured that I could work on the site later to get it back on Adsense.

With Adsense approval on the other earning sites, it seemed like everything should just go smoothly.

Except for one small problem.

The primary ad unit that earned the most $$$ on each of the sites was a Link Ad unit.

A type of unit that was not available in my almost brand new Adsense account.

I discovered later that it is fairly common for new Adsense accounts to not have access to utilize Link Ad units for a few months. They just show up as an option a few months down the line, and I have no idea what you need to do to make it happen.

(Those of you reading this who have more experience with Adsense might know the answer to this, feel free to leave your thoughts in the comments).

But at the time, this was a pretty serious blow to me, the seller, and to the migration team because we had all just made the assumption that the ad setup and placement could be replicated pretty close to 100%.

We had no choice but to replace the Link Ad unit with a responsive Display Ad unit, and then let things run and see what happened.

As I mentioned above, the first hurdle after getting the sites approved in my Adsense account was that I didn’t have the same high earning ad unit available.

The second hurdle was that Google Adsense had some massive and worldwide problems in May and June of 2019, right during the time we were doing migration and inspection.

In some cases, other sites experienced no obvious interruption with services, but noted that clicks and page views weren’t accruing or being reported. In other cases, it was a matter of just no ads at all being shown in the ad spaces.

For the first three or so days of the inspection period, I was really, really excited. I was checking my phone basically every five minutes, watching the clicks on the ads come in, and the dollars slowly rack up. The best thing about waking up was reaching over to grab my phone to see how much money I had made while I was sleeping.

I had made some dollars before online, but not enough to where I no longer felt a thrill at looking at my Adsense account balance.

It was really, really exciting.

Then one morning, I woke to see zeros. Nothing.

Confused and upset, I reached out to the migration team, assuming that they had done something or changed something.

But they hadn’t touched anything, and the seller no longer had access to the back end of the sites to mess with anything.

After some investigation, we determined what the problem was.

I wasn’t earning any Adsense money because no ads were appearing on my sites.

Just blank white spaces in the spots where ad units were placed.

And it turns out, I wasn’t the only one.

Many large and small publishers all over the world were in the same situation as me. Forums were clogged with people trying to figure out what had happened, and how to fix things.

The seller and I exchanged some emails about it, the first real direct communications we’d had throughout the entire process.

I felt good about my position, as the sites had not yet concluded the inspection period with enough earnings to pass. The seller was looking at having to take his sites back, without any assurances that Adsense would every start working on them again.

Empire Flippers asked us to hold off on making any hasty judgments, as they tried to trouble shoot the problem.

Frankly, it felt good to be able to lean on EF and the seller, because I felt like they all had a lot more experience in the relevant matters than I did, and were probably connected to more communities than I was.

But after a few days, there were still no answers.

I’m a pretty reasonable person, and felt secure in my position, so I agreed to let the migrations team and the seller work together to see if they could come up with an alternative arrangement to get the sites earning again.

It seemed like the right thing to do, and I wanted to proceed with good faith at all stages of the process.

After all, I had just had a taste of what the sites could do if they were earning as usual. I wasn’t ready to give that up or start all over.

This led to a month-long period of me applying with the sites to other various ad networks I’d never used or heard of (getting accepted by some (Ezoic) and rejected by others (Mediavine)). In the end, we were able to get the sites up and running on SetUpAds, which seemed to produce an income similar to what we’d been looking for on Adsense.

In hindsight now, perhaps I should have just taken these troubles as a sign that the deal wasn’t right, or that there would be more trouble on the horizon.

But knowing me (being reasonable, and generally a positive, helpful person), I just rolled with it.

After a few days of earning on SetUpAds, people across the globe reported that Adsense had suddenly come back online for them and ads were again showing.

The migrations team immediately replaced the SetUpAd ad units with the original configuration (as close as we could get to it) and then restarted the inspection period.

Serendipity is a funny thing.

Not less than two days after restarting the inspection period, one of the posts on one of the sites got a massive blast of traffic because of a trending event that occurred in the world of the site’s niche.

So a page that might normally get a few thousand hits in a given month got about 150,000 views in about three days. The ad revenue was through the roof for those few days, and we basically blasted through the revenue needed to pass inspection with ease.

Naturally, it was pretty clear to me that this traffic explosion wasn’t something that would be permanent or repeated. But per the terms of the buy/sell contract, the business had passed inspection and was ready to close.

Thus, the deal closed the first week of July of 2019, almost two months after the negotiations on the site had concluded.

I was hopeful that everything would run smoothly going forward.

But it turns out that Google had some other ideas.