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Thread: I'm another victim of shill bidding at Flippa

  1. #11
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    Just a quick update. Bryan (who is part of the flippa team and runs the deal flow part of flippa) forwarded my concern to Flippa’s customer service (CS). The CS did reach out to me by 12noon (EST) yesterday asking for details in regards to what had happened. I then emailed him back right away with all the details. I subsequently got a response back at 8pm (EST) from the same rep stating that they have escalated the issue and will get back to me by next week. They also mentioned that based on the details I have provided it does seem worrisome and further thanked me for sharing the details with them.

    So I am really glad to see them take this seriously and taking appropriate measures. For me trust is the most important factor in a sale that is heavily dependent on screen shots as evidence of revenue. Without trust it is very hard to go forward with any form of business. At this point I have zero doubt that there was shill bidding going on. That being said I dont know what to tell the seller who is waiting on the money transfer; not sure if he will be willing to wait till next week.

    Should I be upfront with the seller and let him know what is happening? If I do that I am worried that he might try to influence flippa's review.

  2. #12
    Moderator Kay is a Premium Member
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    Are you sure you have your facts right here?

    Quote Originally Posted by rifs84
    Bryan (who is part of the flippa team and runs the deal flow part of flippa) forwarded my concern to Flippa’s customer service (CS).
    This is the first I've heard that Bryan is part of the Flippa team. He's one of the owners of Centurica and you can find plenty of posts on the Flippa blog about Flippa's partnership with Centurica. Centurica claim they're independent from Flippa, but Flippa shouts from the rooftops about the partnership and how you should be reassured by Centurica's "due diligence" on the Flippa listings. Some of us say that if it's DD facilitated by the marketplace (which acts on behalf of the seller) it's not independent. And one has to wonder how much of Centurica's income depends on Flippa these days, given how actively Flippa is promoting their services.

    Most of us already know about the Centurica and Flippa partnership, and some of us have questioned Centurica's independence. But to suggest that Bryan is running Deal Flow is an entirely different matter. I think maybe Clinton's question is most apt here.

    Quote Originally Posted by Clinton
    Are you saying Bryan's also the broker in this deal?
    I really find this very hard to believe and if it's not the case, then we should get this sorted out ASAP. It's one thing to question their ability to do independent due diligence, given their partnership with Flippa, but it's quite another to suggest that they are playing the role of broker as well in the same transactions.

    We already know that Flippa plays more than one role in Deal Flow transactions - they charge the buyer a finder's fee and the seller a success fee for the same transaction. Yet they advertise themselves as being brokers. Brokers are normally agents of the seller so I don't know how they can be on both sides in the same transaction. I won't speculate about it. Maybe someone else has the facts.
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  3. #13
    Moderator Kay is a Premium Member
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    I apologise to you rifs84. I simply couldn't believe that Bryan would be working for Flippa as well as providing "due diligence" services on Flippa listings. Actually I'm stunned, but it seems you're right.

    Bryan's public Linked In page.

    People often think I'm a hard b!tch but I do try to give people the benefit of the doubt. I don't know what to say now.
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  4. #14
    Moderator Kay is a Premium Member
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    Here is more information about the "independent" company doing the DD on Flippa listings.


    bryan-oneil-linkedin.png


    Also, here's an announcement of the Deal Flow appointment on Flippa's blog. I missed it before because I don't often visit Flippa.

    http://flippa.com/blog/news-updates-...ebsite-broker/

    And yet, whenever we've queried Centurica's independence from Flippa, and therefore their ability to do DD in a marketplace which makes its money from sellers, they tell us they're independent.
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  5. #15
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    Bryan's relationship with flippa does not really have anything to do with this topic and yet it keeps getting brought up over and over again. Obviously you and Clinton seem to have something against him but dont you think that should be discussed in a different topic?

  6. #16
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    For the record, I don't have a problem with Bryan and have always had a cordial relationship with him. My query was simply out of confusion as to why you'd contact him, and you didn't answer it the first time it was raised. Now that you've explained the dealflow connection the question is answered.

    So I am really glad to see them take this seriously and taking appropriate measures.
    If Flippa customer services has this all in hand....do drop in and let us know how it goes.

    On a different matter, I don't believe "trust" is the most important factor. It's verification of all claims to your complete satisfaction that's the most important factor. Trust matters only in that when there is lack of it there's good reason to avoid the transaction (even when everything else checks out)... as you are doing albeit a bit late.
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    Thanks for bringing this to my attention rifs84.

    Apologies about not replying to your email yet - I've been on leave for a couple of days.

    I'm now looking into this matter with our websites marketplace manager and it sounds like our support team are already onto the issue but I'm organising a call with them to understand the status of this issue.

    As for the thread's interest in Bryan at Flippa - Bryan is the manager of our website brokerage service, Deal Flow. He's been with Flippa for around 6 months now I think

    While Bryan is now part of the Flippa team, we're still completely independent of Centurica. We have a partnership for one product and that's about it. I don't understand why anyone would think different!
    Last edited by tbcooke; 6 July 2014 at 8:41 pm.

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  9. #18
    Moderator Kay is a Premium Member
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    While Bryan is now part of the Flippa team, we're still completely independent of Centurica. We have a partnership for one product and that's about it. I don't understand why anyone would think different!
    Thanks for dropping by, Tim.

    How can you have a partnership with someone and be completely independent from them? That's what I don't understand.

    If the DD is based on computer generated data and is therefore objective, then it's not proper DD. If computers crunch the figures and humans analyse them, then the human involvement calls on judgement and is therefore subjective.

    Flippa is a marketplace which makes its money from sellers. There are several postings on EP, including those from brokers, saying that if a broker who is acting on behalf of the seller offers to do due diligence for the buyer, then you should run away. And yet in this case you're suggesting that an adviser to Flippa's Deal Flow brokerage service is also providing the due diligence. There is a clear conflict of interest in the case of where a broker - whose role is to get the highest price possible for the seller - also acts for the buyer to reassure him that the figures make sense.

    I have always argued the case that people should learn to do their own due diligence. It's not just number crunching or something which a computer can do. It relies on human judgement and the ability to sniff out things which might be cleverly disguised. A computer can't do that.

    You can't have it both ways. If a computer is doing it, then it's not due diligence. If humans are doing it, then it's subjective and could be influenced by external sources - such as having a partnership with the entity who is acting on behalf of the seller.
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  10. #19
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    Just a final update on this matter. Flippa performed their own internal review and based on their investigation they did not find any evidence of shill bidding. However since we no longer are willing to go forward with this sale they have agreed to remove all the details and allow both the parties to walk away from the transaction. Once the issue was brought up to the right staff it was resolved on a timely manner. Bryan O' Neil was very helpful in forwarding my issue to the right flippa staff.

    According to them the confusion was mainly caused due to their proxy bidding functionality which does not show a bid of another user if proxy bid was used, thus giving the appearance that an user has out bid themselves. That to me seems to be a glitch in their system and should be resolved in order to avoid future confusion. If it cannot be resolved it should at least be mentioned in their website in order to educate the bidders.

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  12. #20
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    That to me seems to be a glitch in their system
    The idea for proxy bidding and the design for how it should work were originally proposed in this forum on Flippa's request for suggestions. Flippa then implemented it ... over two years ago. They've had lots of time to tweak it. I would be surprised if there is still a major glitch. Perhaps this behaviour is by design (for whatever reason). Anyway, thanks for updating us.
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