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Thread: Building a new Marketplace

  1. #41
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    Quote Originally Posted by richrf View Post
    There is an legal issue associated with warranting any claims. Suppose the owner of the marketplace warrants that proof has been received and confirmed and it turns out that the seller has fooled the marketplace owner (there are many ways that this can be done). The owner of the marketplace would then be liable for legal damages. Of course, it is possible to get insurance for this type of problem but it would be very costly and in any case, there is always a possibility that negligence can be proved and then the insurance company is off the hook. So, it all gets very messy. Personally, I feel best when I don't have to get involved with people and money. That mix always is quite toxic. :-)
    There's a difference between stating that all claims are accurate and confirming that someone who has proof that the site is making $100 per month isn't putting $200 per month in the stats or description to attract interest. I am talking about the latter. While it would probably be possible to set up terms and conditions that would make it difficult for someone to successfully sue you in any case, verifying all revenue and costs would be too much work for a one man shop on a budget to take on.
    Last edited by benitez17; 30 December 2010 at 6:57 am.

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    Quote Originally Posted by benitez17 View Post
    There's a difference between stating that all claims are accurate and confirming that someone who has proof that the site is making $100 per month isn't putting $200 per month in the stats or description to attract interest. I am talking about the latter. While it would probably be possible to set up terms and conditions that would make it difficult for someone to successfully sue you in any case, verifying all revenue and costs would be too much work for a one man shop on a budget to take on.
    In this regard, I believe that Flippa's approach is reasonable (and no doubt motivated by legal concerns). They allow sellers to publish documentation which buyers can review. If the documentation is suspect, the buyers can request further documentation. The problem with online transactions is that people have figured out all kinds of ways to skew data ... ways that I am constantly discovering and which amazes me in their ingenuity (money really motivates the creative juices in human beings).
    Last edited by richrf; 30 December 2010 at 10:53 am.

  3. #43
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    Quote Originally Posted by richrf View Post
    In this regard, I believe that Flippa's approach is reasonable (and no doubt motivated by legal concerns). They allow sellers to publish documentation which buyers can review. If the documentation is suspect, the buyers can request further documentation. The problem with online transactions is that people have figure out all kinds of ways to skew data ... ways that I am constantly discovering and which amazes me in their ingenuity (money really motivates the creative juices in human beings).
    Where they get in trouble with me is the repeated claims by them and their guest posting shills claiming that their marketplace is completely safe. If they want to stand back and allow a free for all while making their stance clear, I would respect that.

    I think they are just as liable for a lawsuit now by touting the safety of their marketplace as they would be by actually trying to keep sellers honest.

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    I would definitely agree with you. I have not read their postings, but if they are claiming that their site is completely safe, then I would say that they have opened themselves up to legal claims. Of course, there is no site on the internet that is completely safe as has been demonstrated many times.

  5. #45
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    I don't believe benitez17 meant safe in that way. He was probably talking about Flippa's claims about their site being a safe marketplace, a safe place to buy sites.

    In their defence, they have tried to put a few things in place to aid safety, but it's wildly irresponsible of them to call their marketplace safe when they know better than most about the shill bidding, the faking of seller reputation, the ease with which their members can get around the phone verification etc. What I find particularly irresponsible of them is that they encourage people into the lions den with cheery reassurances, "Don't worry, folk, these are all vegetarian lions".
    Find the right business brokers to maximise the value you extract from your business and improve the chances of selling your business.

  6. #46
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    I did mean safe as Clinton described, not safe from hackers (Flippa has already been hacked at least once).

    They have written posts or posted ones written by others designed to give buyers and sellers nice, warm, fuzzy feelings about Flippa users so everyone can feel comfortable transferring money and assets to a nameless, faceless person who can't really be tracked down if they do something underhanded. In reality, they do very little to protect users, and not nearly enough given the amount of money they demand for their services and the revenues provided by their users.

    Clinton's zookeeper analogy sums up my feelings nicely.

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    Thanks for the feedback on Flippa. I was thinking about listing Links.com on Flippa, since it gives me the most control over the sales process. I would have to investigate further.

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    Quote Originally Posted by richrf View Post
    Thanks for the feedback on Flippa. I was thinking about listing Links.com on Flippa, since it gives me the most control over the sales process. I would have to investigate further.
    That wouldn't be a bad idea. You could put in a very high reserve (like $1 million) so you wouldn't be obligated to sell, and you could get a feel for what the domain market thinks of the domain right now. I'm sure you could do the same at DNForum or other more domain focused sites.

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    Quote Originally Posted by benitez17 View Post
    That wouldn't be a bad idea. You could put in a very high reserve (like $1 million) so you wouldn't be obligated to sell, and you could get a feel for what the domain market thinks of the domain right now. I'm sure you could do the same at DNForum or other more domain focused sites.
    Appreciate the suggestions. I am thinking of giving it a whirl in January as everyone begins to get back to work for the New Year. BTW, HAPPY New Year to you everyone else who has been so helpful on this forum!

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    This is an area I find fascinating and still have almost 4,000 words on the topic still to be published on the blog.

    The irony is, after all the discussion, research, writing and debate in my opinion the best option for a new marketplace is one where people simply list, for a (small) fee and the marketplace owners stay the hell out of their way.

    No upgrades, no bidding, no mediation, just a straight 'classified with criteria' service. This hasn't always been my opinion, but I've seen the light - and about 20 failed sites that tried to do it differently.

    Justin

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