This article covers the details you need to know as a buyer or seller to decide whether to use this popular marketplace or an Empire Flippers alternative.
No Listing Fees
Sellers don’t pay a listing free with Empire Flippers. Sellers only pay if the website or business sells. However, the company rejects most listing submissions. In fact, according to Empire Flippers, they reject 91% of business submissions (details about listing criteria are covered later in this article).
Empire Flippers’ Success Fees
Like most online business brokers and marketplaces, Empire Flippers collects a success fee when a listing is sold. In 2021, the company moved from a tiered fee structure to a blended structure, which can be confusing.
Their success fee is:
- 15% of everything below $700,000
- 8% of the amount between $700,000 – $5,000,000
- 2.5% of everything above $5,000,000
The best way to explain the fee structure is to look at some examples. First, it’s a very simple flat 15% fee for any transaction below $700,000. That means if you sell a website for $600,000, the success fee is $90,000 ($600,000 x 15%).
If the sale price is above $700,000, you’ll need multiple calculations to determine the success fee. The success fee on a $900,000 transaction will be $105,000 ($700,000 x 15%) plus $16,000 ($200,000 x 8%), for a total of $121,000 (an effective commission of 13.44%).
A $7,000,000 transaction will have a success fee of $105,000 ($700,000 x 15%) plus $344,000 ($4,300,000 x 8%) plus $50,000 ($2,000,000 x 2.5%), for a total of $499,000 (an effective commission of 7.13%).
The table below shows how Empire Flippers’ success fees compare to Investors Club, where you can sell with no listing fee and no success fee.
| Comparison of Success Fees | ||
| Selling Price | Empire Flippers Fee | Investors Club Fee |
| $75,000 | $11,250 | $0 |
| $150,000 | $22,500 | $0 |
| $500,000 | $75,000 | $0 |
| $1,000,000 | $129,000 | $0 |
| $2,500,000 | $249,000 | $0 |
Empire Flippers’ website offers a commission calculator. Just enter the sale price and it will approximate the success fee.
Why Does Empire Flippers Use a Blended Fee Structure?
There’s no doubt that Empire Flippers’ blended fee structure is more complex than a flat success fee or a tiered fee structure with different percentages based on the selling price (for example, like the fee structure used by Motion Invest). So why does Empire Flippers use this approach?
The blended success fee structure attempts to overcome some weaknesses of the simpler tiered structure. In a tiered fee structure, the fee can vary significantly based on a small change in price if the sale price is near the cutoff for a tier.
Motion Invest (read our review here) uses a simple tiered structure for success fees. Sales between $100,000 and $500,000 are subject to a 10% success fee. If the sale price is $500,000 to $1,000,000, the success fee is only 5%. So, a $495,000 transaction would have a $49,500 fee (10%). If the selling price were $505,000, the fee would only be $25,250 (5%). That’s a huge variation in the fee for a very small difference in the selling price. The blended structure eliminates this issue.
No Fees for Buyers
Empire Flippers doesn’t charge buyers any fees. Potential buyers can create a free account, but buyers must be verified to see details like the URL or business name of listings. Empire Flippers focuses on two aspects for verification: identity and liquidity.
Every Empire Flippers account must be linked to an individual and cannot be in a company name. Buyers can verify their identity by uploading a copy of their driver’s license, passport, or other government-issued ID. Empire Flippers uses Persona to do an additional video verification using either a webcam or phone camera.
Liquidity is verified by connecting a bank, brokerage, or crypto account using Plaid or manually uploading proof of funds, like bank statements. The amount of verified funds determines the maximum price of listings that can be unlocked.
For example, buyers approved for up to $1 million can unlock any listing $1 million or below, but cannot unlock listings priced above $1 million.
Empire Flippers currently doesn’t offer any type of membership program for buyers. They offer free escrow and migration services, so there are no fees of any kind for buyers.
Empire Flippers’ Listing Criteria
Empire Flippers requires that websites and businesses meet these requirements to be listed:
- Minimum of $2,000 monthly net profit over the past 12 months
- At least 3 months of traffic data from Google Analytics or Clicky
- At least 12 months of revenue
- AdSense, Amazon Associates, affiliate, and advertising sites cannot have changed URLs within the past 12 months
- No evidence of manipulated rankings (i.e., manual penalties, deleted accounts, 301 redirects)
- Service-based businesses cannot generate more than 50% of their revenue from one client
- Businesses cannot have fake social media followers
However, even websites and online businesses that meet these basic requirements aren’t guaranteed approval. Empire Flippers manually reviews each submission to determine which businesses will be listed in its marketplace.
An Alternative With No Selling Fees
If you’re looking for a marketplace that allows you to keep all of the money from the sale, consider selling with Investors Club. We charge no listing fees and no success fees, which means you can walk away with money.
Online Business Builder & Content Strategist
Marc has been building websites and online businesses since 2007. He’s built successful businesses in several industries, including web/graphic design, photography, travel, and personal finance. Marc is the founder of Flip My Site, where he writes about buying and selling websites.
Connect with Marc:
Linkedin | Twitter | FlipMySite