If you’re thinking of buying a flash games website, here’s a quick guide for things to look into and out for.
Don’t pay for potential
Anything has the potential to make a lot of money, but in the world of flash websites you’re not supposed to pay for potential. Ask for actual revenue statistics. As a rule of thumb flash sites go for 12-24 months worth of revenues (based on historic figures, not predictions!)
Study the traffic sources
To minimize risk, it’s not enough to know that if things stay the same you’ll make your money back in X months. You should study the traffic sources and asses the risks of traffic dwindling before you buy. There are three primary ways that flash gaming sites receive visitors:
Traffic exchange (game plugs)
Sites can get very big by exchanging traffic with other sites. However this type of traffic is very unstable. Make sure you understand the ins and outs of how it works. Contact existing trade partners to ensure they are comfortable trading with you. Unless you’re a seasoned traffic trader, assume a minimum of 30% drop in traffic trading efficiency.
SEO (traffic from search engines)
This seems to be a very safe source of traffic. Let’s say you’re looking into a Dress Up Games website and it ranks in the first page of Google for “Dress Up Games” and gets most of its traffic from Google. You need to be sure that after you buy the website the rankings will not drop. Do this by examining the inbound links the site receives. Ask the existing owner for a list of all link deals they have and links they are giving the website from their own sites. Use Yahoo Site Explorer to look at some of the site’s links yourself. Are there a lot of links that seem like they might disappear after you purchase the site?
Sponsored games are one of the best sources of traffic. They are virtually impossible to fake and tend to send reliable amounts of traffic. Make sure that the majority of traffic isn’t coming from newly released games (in the first 2-3 months a game will send a lot more traffic than subsequent months). Also ensure the the games are not stolen and that the seller owns all the rights to these games (and that you are buying the rights to them together with the site). If you don’t release new games after buying the site you can assume traffic from sponsored games will drop 2-5% per month.
If you’re a newbie buyer, it’s always a good idea to consult professionals before buying. Post a thread on some webmaster forums or ask people you know. It’s better to risk getting outbid than to regret an acquisition.
Happy holidays and good business to you all!