What steps does one have to take before purchasing an online business? There are many steps that are obvious to me, like: *asking for proof of traffic and revenue *cost of basic necessities to run business *proof of ownership *asking for a reason of sale etc... Obviously a site that is making some one money isn't going to be sold very cheaply, so that's a sign to look out for... What other steps do you take before buying a business / revenue earning site?
might follow those steps just to understand the seller..... but not that keen on those as even a combination of all these can end up in a scam just going ahead of what is told about the site and do cross checks for traffic, revenue, running costs using experience to check whether its genunie then Escrow the transaction
if you are buying a business whom solely make money from advertising e.g. adsense affiliate etc you can ask for a contact at those organizations to verify the relationship and revenue. do do your dudilligence, i know a guy who used his own money and got VC funding to buy an online business and the trend was actually on a downturn (which he is now realising) so think about why they are prepared to sell and check the market for competitors etc and trends for those competitors.
Ensure the business he does is legal in your country. Find out when his domain is going to expire and ensure all transactions is smoothly transferred to your name. Legality is always important, find out his terms and all that really protects your Intellectual Property. Good luck.