If you are planning on buying or selling digital assets you’ll want to use a broker or an online marketplace. They aren’t necessary however they lower the risk of being scammed and make the process much smoother.
The main benefit of using them is that they have access to thousands of potential buyers or sellers, along with all the other things they assist with which we’ll cover in this review.
In this article, we’re going to review Microacquire and Flippa and then compare them to find out which one we think is better. Let’s get into it.
Presenting The Contestants: Microacquire and Flippa
Andrew describes the acquisition market as ‘broken’ and therefore his goal with Microacquire is to fix it and provide users with a working platform to buy and sell startups. He is surrounded by 13 other specialists that help him turn this goal into a reality.
While only being active for two years, Microacquire already has over 100,000 users and has closed over $100 million in acquisitions.
Read the detailed MicroAcquire review.
Flippa is one of the most popular brokers for buying and selling digital assets with over 6,000 listings currently available on the marketplace.
They have been operating since 2009 and have done over $400 million in total asset sales which makes them veterans in the broker business.
With Flippa’s free valuation tool you can be on your way to selling an asset in a matter of minutes. Their large marketplace is also full of opportunities for buyers as they have a self-proclaimed user base of around 1.5 million people.
Blake Hutchison is their CEO and he’s surrounded by a team of specialists all in their own areas to assist you in selling your digital asset. They’ve got dedicated teams in all areas of the globe to make selling your business a stress-free experience.
Read the detailed Flippa review.
What Type Of Businesses Are Offered?
Microacquire allows users to buy and sell startups. This covers a whole variety of businesses like SaaS companies, Shopify apps, eCommerce, and even crypto-based startups.
The marketplace allows you to filter what type of asset you’re wanting to buy, making it easier to find the one you want. There is no shortage of niches either available on Microacquire, with startups ranging from outside all the way to pharmacy.
With over 6.000 listings currently on Flippa’s marketplace, there’s a business for the pickiest buyers. The majority of assets available to buy on Flippa are websites ranging from affiliate sites, dropshipping sites, eCommerce sites, and Amazon FBA sites.
As there are so many users on Flippa as a buyer you’ll be spoilt for choice on what business you want to buy. The variety in niches is perfect for those who have a specific niche they like to stick to.
You can also buy mobile apps whether they are ios or android, however out of the 6,000 current listings, apps only make up 440 so the vast majority of assets being sold are websites.
Listing information is a website overview you see on the marketplace, containing information like monetization method, asset price, and niche.
The public information given about a listing contains things like asset niche, when the startup was founded, startup team size, number of customers, financial details, and the owner’s reason for selling.
In order to see private information about the listing like the URL, company name, and contact details you need to join Microacquires premium membership to access it.
When it comes to using Flippa, as a seller you have the option of your listing being more public to potential buyers. You can choose to reveal the domain name along with detailing the basic listing information such as price, monetization method, site age, and what type of website it is.
Sellers have the opportunity to make the listing private however this comes with an extra $100 fee on top of the $29 listing fee. In order to see the URL of a private listing, any potential buyers are required to sign an NDA to ensure privacy.
Business Valuation Process
Before an asset can be listed on a marketplace it needs to go through a valuation process. This is to determine how much the business is worth so it can be given a listing price. A valuation is given after you fill in information about the asset such as revenue, expenses, traffic, domain age, and a number of other details
Microacquire allows the seller to evaluate their own business and come up with a selling price that they think is justified. This means as the seller you need to do it yourself without the help of Microacquire. However, they do have a free e-book and valuation tool you can use to get an estimate of how much your business is worth.
There are two different ways Flippa put a valuation on your business.
The first and quickest way is to use their free valuation tool. You are asked to enter certain information about your website like the URL, monthly traffic, and when the website was registered. The tool then uses a formula to try and give you an accurate valuation of your website.
However the number it gives you won’t always be the actual price your website can be listed at. That’s done using the second, more in-depth valuation that Flippa performs manually.
For this valuation, you’ll need to give more information about your website like expenses, access to google analytics, and income reports. To get the best price from Flippa you need to give them accurate information at this stage.
Once all of the information above has been verified by Flippa’s experts they will then come back to you with a price at which you can list on their marketplace.
Business Due Diligence Process
When it comes to buying assets online, or offline as a matter of fact, then you need to do your due diligence.
This is the process of verifying that the asset you want to buy, is exactly as it’s advertised. What this means is going through different processes to verify that things like the traffic and monthly income of the website aren’t fabricated.
As doing due diligence is quite a time-consuming process, some brokers will assist buyers to protect them and make sure it’s done correctly.
Microacquire doesn’t particularly help buyers when it comes to doing due diligence. They simply connect buyer and seller and let the respective parties do the rest.
There are two ways Flippa can assist buyers with due diligence.
While they aren’t directly helping you, Flippa created a blog post that covers every aspect of due diligence that you should be doing as a buyer. The better your due diligence process becomes, the less likely you are to be scammed or feel upset after a purchase.
Their due diligence checklist contains 23 things you can check to ensure that the asset you’re buying is as advertised. It includes things such as :
- Verifying visitor engagement
- Analytic trends
- Monetization methods
- Whois history
There are a number of other methods they talk about in the post which you can read here.
Flippa paid due diligence service
If doing the due diligence yourself sounds like too much work then Flippa has a paid service where they do all the work for you. They currently have three different plans.
- Red flag report ($1,000) – For buying this report you’ll get 11-14 pages worth of information about the asset you want to buy. Flippa will analyze the website going back 1 year.
- Standard report ($1,500) – For buying this report you’ll get 12-25 pages worth of information about the asset you want to buy. Flippa will analyze the website going back 2 years.
- Enhanced report ($2,000) – For buying this report you’ll get 26-35 pages worth of information about the asset you want to buy. Flippa will analyze the website going back 3 years.
Safety & Verifiable Information
It’s important that the marketplace you use to buy and sell a digital asset is trustworthy. You want to be able to trust them enough to send them funds if you’re buying a business When it comes to viewing the listings you want to know that all the companies you see are legit and things like the income or traffic haven’t been fabricated.
As Microacquire is a marketplace and not a broker like Flippa, once a deal has been made between buyer and seller they don’t act as a mediator.
This means the potential to get scammed is greater therefore you need to use a secure service like Escrow. They will hold the funds until it’s been confirmed by the buyer that ownership of the business has been transferred to them. After this is confirmed Escrow will release the funds over to the seller.
Flippa is much more relaxed when it comes to letting sellers list on the marketplace. There’s currently no vetting process which means anyone can go ahead and list an asset.
This is both a pro and a con. It’s a pro because as a buyer you’ll have access to thousands of potential websites to buy. However, it’s also a con because due to anyone being able to list a website, not all of them are legitimate.
When it comes to the transferring of funds and asset, Flippa are incredibly secure due to the fact they act as a mediator between both buyer and seller. This means they hold the funds until the buyer has been given ownership to the asset. This leaves both parties satisfied and at no risk of being scammed.
Fees & Commission Structure
As brokers place your website in the eyes of potential buyers, they charge fees for doing so. This is how they make money, after all, they are a business too. There are normally two different types of fees you have to pay brokers, a listing fee and a success fee.
Microacquire doesn’t charge you a fee for listing your asset, nor do they charge a fee for you’re asset selling. This leads people to ask the question, “so how do Microacquire make money?”
Microacquire makes money through a yearly premium membership called premium buyers. It costs $390 annually and it gives you benefits that regular users don’t have access to.
You can check it out below.
Flippa charges a standard listing fee of $29 to place your website on their marketplace. Discounted down from $49 this allows your website to be shown for 3 months, if you don’t manage to find a buyer within the time period then you’ll have to pay another $29 to list it again.
However, with the large user base, you should be able to find a willing buyer relatively quickly, given that all your website information is accurate and you were completely transparent during the vetting process.
Next up we have the sale fee. If Flippa does find a buyer for your website then there’s also a success fee you need to pay them. The amount varies based on how much your asset is sold for.
- $1-$49,000 = 10% success fee
- $50,000-$99,000 = 7.5% success fee
- $100,000-$2million = 5% success fee
Flippa also has a feature called price match guarantee. If you find another broker that charges a lower success fee than them, they promise to beat their fee by 1%.
Once an asset has been bought and the domain is transferred over some brokers like to stick around to help you with any problems that may arise. Brokers don’t have to do this as they’ve already done their work and got a fee for it, so it’s good customer service to do so.
Microacquire currently doesn’t have any post-sale support for buyers. This means it’s up to the previous owner of the asset to answer any questions or provide the help that the new buyer needs.
This needs to be negotiated between both parties before the deal has been made.
Flippa don’t currently provide any post-sale support however they ask sellers to do it on their own. You can do this by choosing post-auction support when you’re creating a listing to put on the marketplace.
They also provide a blog post explaining how to provide the new buyer with the best post-sale support, which you can read here.
Once a deal has been made and the buyer has sent the funds, asset migration can take place. This is the process of the old owner transferring the website over to the new buyer. You can do this yourself or let a broker take care of it for you.
This part of the sale is down to the buyer and seller to communicate with each other. Microacquire currently don’t provide any assistance when it comes to transferring the asset ownership.
At the time of writing Flippa doesn’t currently provide any assistance regarding asset migration. They even suggest you use an external service to do it for you, so it’s not something they prioritize right now.
Flippa does however have a number of articles on their blog that go through each step of the migration process, which you can read about here.
Microacquire vs Flippa – Verdict
After researching both Microacquire and Flippa, the winner is clear to us – and it’s Flippa.
They provide more support in almost every aspect of the sale, with the only thing Microacquire doing better is the no listing or final sale fee.
Microacquire is more of a marketplace to connect buyers and sellers. Flippa is a marketplace too however they help with much more than Microacquire currently too.
With Flippa’s authority over Microacquire too we can’t see a world in which we would choose Microacquire over them.