Insights for Entrepreneurs

Build a Bidding Site like Tophatter – Plan, Cost & Time Estimation

Amresh Babu

12 Feb 2019 on Insights for Entrepreneurs · 14 min read

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14 min read

This article is for the ones who are curious about starting a website like Tophatter or in pursuit of Tophatter clone to launch an online bidding business.

Let’s start with Online Auction

What is Online Auction?

Online auctions are a reflection of the Traditional auction which entangles more number of participants for bidding. It is a practice of a seller availing his product or service at an auction for bids, where the buyers will bid on the products and services based on their interest & budget.

Online auctions are as same as Traditional auctions where auction takes place via the Internet. They provide opportunities for people from different parts of the world to trade their product or services. The auction starts with a small bid amount which further will increase steadily to meet demands and popularity.

Online Auction Websites are immensely popular with high-traffic where anyone can sell product instantly, with NO

  • Upfront costs
  • Website of your own
  • Distributors or sales staff
  • Fixed time
  • Geographical limitations
  • Initial investment
  • And offers highly intensive social interactions

Online Auction also Includes a huge number of bidders and sellers, which encourages an online business at a high-volume. They are also knowns as Virtual Auction.

What is a Reverse Auction?

A reverse auction is an inverted type of regular auction in which the buyer and seller roles are reversed. Here, to obtain business from the buyers the sellers bid against each other pushing the price up by lowering the profit and win the bid. This term is also called procurement auction.

Find below the pictorial representation of Auction and Reverse Auction:

Forward Auction VS Reverse Auction


For instance, Let’s look at the Successful Businesses in the Auction Industry to know how they work.

Successful Businesses in the Auction Industry

You may find a vast variety of business which uses auction as their business model and few to mention are:

  • Tophatter
  • DealDash
  • BidorBuy


Tophatter – San Francisco, California based virtual auction website was backed by leading venture capital firms. It happens to be a unique marketplace and shopping app which offers the users a speedy and entertaining experience.

By all means, Tophatter makes buyers and sellers chat, transact and interact by conducting regular live auctions with a variety of categories. Here, the bidders compete in 90-second auctions to win deals.

Tophatter serves both desktop and mobile customers connecting over 10 million shoppers to sellers around the world.


Dealdash is also one type of auction website which works with a penny. allows users to Bid on auctions and save. All their auctions start at $0 with no minimum reserve. It is the most exciting way to win a deal and discover brands!

Dealdash requires bids to play and win. Users have to buy bids and participate in the auction. If they didn’t win the auction, there is an opportunity for the bidders to buy that particular item for a fair price and get full returns on the bids used for that auction.

Established in 2009, Dealdash managed to grow its user-base to over 5 million. It is the largest operating company in Minnesota, United States.


Established in August 1999, is Africa’s largest online marketplace that unifies sellers and buyers to trade anything through online auctions and fixed-price sales.

Bidorbuy avails sellers a handy payment tool for the ones who are unable to qualify for credit card merchant accounts themselves. This makes them build a payment service called bobPay which includes payments made by EFT and Credit Cards.

They do also provide sellers with tools to manage their sales easily through bidorbuy system.

Top Leaders of Auction Industry

Why and what makes Tophatter stand out from his competitors?

Obviously, Among the three auction script above, Tophatter is unique and leads the industry. Find the reasons below.

The First and foremost reason why Tophatter is unique other than DealDash and Bidorbuy is it makes the shopping more entertained or even to a new level.

It is a speedy, free of cost auction website which serves users with hundreds of auctions closing at any time.

Not only that, but Tophatter also offers more volume of auctions which results in outpacing few largest penny auction websites such as DealDash and Bidorbuy.

Reasons why Tophatter is Unique?

Free-to-Bid Auctions: A user has to pay only when he wins a bid along with shipping charges. No other hidden charges are imposed – STRICTLY all auctions are free to bid.

More Sellers: The items which you may find at the home page of the website are totally provided by vendors. This may clearly state that n number of sellers available in Tophatter. It might also look similar to eBay but it is not and it was more fun than eBay.

Huge Auction Volume: As a result of more sellers, the product volume available in Tophatter is Huge. Witness it by visiting the Tophatter website.

This is how Tophatter managed to stand out from their competitors.

As a matter of fact, these were the major reasons why Entrepreneurs look for Tophatter clone or Tophatter like websites.

How Tophatter makes revenue?

Before understanding how Tophatter makes revenue. Let us all know how auction sites make money in common.

In general, every auction script will make money from the sellers. Yes, the sellers are the major source of income for the auction websites.

This is because the sellers will be charged a listing fee to showcase their products and this is based on the excellence of the product.

Then the buyers will start bidding for the product and whoever wins the bid will buy the product by paying the cost through various payment options to the sellers.

But in Tophatter, there is no any kind of listing fee is charged to list the products. The sellers are allowed to list their product with totally free of cost.

According to Forbes, In terms of revenue Tophatter has doubled its revenue from $150 Million to $300 Million in 2017.


We’re going to do so last year (2017) we did over 300 million in Top by in this year right now like we’re focused on doing a billion dollars in 2019 this year will do at least a half a billion dollars(2018). – Ashvin Kumar CEO of Tophatter in a ShopTalk 2018 show named “The Jason & Scot Show”.

So, This might make you wonder how did an eCommerce startup that ever managed to achieve so much. Let me tell you now How Tophatter Makes Revenue?

The Tophatter makes revenue majorly through three ways:


Yes, Like mentioned earlier there is no cost for listing a product as Seller. But there will be a commission on the final sale price in Tophatter.

Tophatter charges up to 10% of commission on shipping and complete paid transaction.

Scheduling Fee:

You would have learned above that Tophatter website provides a high volume of auctions. This means availing products for bidding. Tophatter charges a scheduling fee to schedule a product for auction.

Tophatter Revenue Stream

Tophatter by default charges $1 to schedule a product from sellers. The sellers may also able to set a custom price and maximum daily schedules for their product to be auctioned. The more the schedule value the more opportunities for sale.

Processing Fee:

Tophatter collects a processing fee from the sellers while a buyer pays for the product using Paypal. It will be as equal to the PayPal processing Fees.

Along with these, Tophatter generates revenue through other deductions like chargeback fee, refund deduction, shipping label, shipping label insurance, and disbursement correction fee.

This is how Tophatter generates revenue and managed to reach $300 Million in earnings and has the capability to reach Billions.

As of now, you would have known about:

  • The basic idea about auction online
  • Reverse Auction
  • The successful business using the auction industry
  • Why and what makes Tophatter stand out from his competitors?
  • How Tophatter makes good revenue?

Now let us learn how to create a website like Tophatter.

How to create a website like Tophatter?

To create a website like Tophatter you will be having three options:

  • Using WordPress or Shopify Platform
  • Building a Custom solution
  • And a Readymade solution like Tophatter Clone.

Of the above, I would prefer a Readymade solution as it is very much easy to fine tune a classified readymade solution into an auction script.

Evidently, a buy-sell marketplace solution could be tweaked to start an auction website. To understand how it’s possible, let’s know the basic and smart features of bidding sites:

Uploading a Product

An auction website will allow the users to upload their product on the website and set a particular start price, reserve price and to add a category and a product image.

This could be easily achieved with a buy-sell solution which will also allow the users to post a product, set the price, add category and images.

Auction Listing Management

The product which is listed by the sellers for bidding will be overlooked by the Admin. The Admin has to organize and approve the products listed for the bidding.

A buy-sell solution will also contain a dashboard for the site admin to look after the products posted by sellers. So, this could be effortlessly tweaked for an auction website.

Tracking Transactions

An Auction website will allow the admin to track the details of the auctions which previously happened. It will track previous auction transactions with descriptions like total, user and amount of fee.

A readymade solution to buy sell ads marketplace will eventually allow the admin to view the history of transactions made in the website. So, this could be altered for the bidding business without a plague.

Paying Channel

NO matter what type of website you build online – Payments are the critical ones. When it comes to an online, the payment gateway must be processing easily, richly featured, and secured.

It is important for a website builder to enable a smooth transaction with a confirmation email. The website must also accept payment from different countries with different payment options.

joybid homepage

There are few smart bidding features which are most critical for an auction website:

Instant Bidding status update & Refreshing the listings

Auction websites are required to update the bidding status to all bidders simultaneously to avoid bidding overridden. The bidding product should be visible to all the other users providing a chance to make higher bids.

This feature is the backbone of any online auction website and is possible by using advanced technologies like NodeJS, Media Servers, and other real-time update protocol services.

Reserving the minimum bid

This feature will allow all the sellers to set a minimum reserved bid for the products. This initiates the bidding price for a product while auctioning. This is the Target price for the product.

The system will automatically schedule the auction with a value of the reserved bid.  It is mandatory to set the Target price to schedule a product for auction.

Significantly, Classified Script could be easily adjusted to achieve this feature and meet the requirements.

Winning or losing the bid

Instant notifications of winning or losing the bid is also a pivotal feature which shows buyers the auction results in real time.

The Website must be capable to display the buyers with the Winning information when the buyer bids for the highest price and should display losing information to outbid other bidders and win the item.

It is also important to showcase the buyer with the information of how long the item will be available to accept bids. A short time notification would go a long way in attracting the users.

Proxy Bidding

Proxy bidding benefits the buyers to set the highest price value they are willing to pay. Here the buyer will set a value he wishes to pay along with increment value for bids. The system will automatically bid on a product with preset increment value to win the bid. Bids will not be visible to auction participants. In the event of a tie, the earliest bid takes priority.

Buy Out

An e-commerce way to sell the product straightaway to the customers by offering the best price. The Auction site must not work for only bidding but it must also allow buyers to buy a product by paying the preferred price.

Buyer may bid or buy the product by paying the preferred retail value. The sellers have an opportunity to sell their products by bidding and through e-commerce way.

Buy Out feature is as similar to the core feature of a readymade e-commerce solution. It is possible with an effective e-commerce script like Fantacy.

Closing the Bid

If a user wins the bid it must direct the user to the payment gateway for further process. The item must be replaced with a new item which should be visible to all the users available to bid.

If a bid is closed the next bid must be started within a few seconds and the Bidding option for all the users must be enabled.

To achieve the above you will require a solid web development team who are experts in using the latest technologies.

Or, you may look at these readymade solutions Classified Script and ecommerce script which may be unified to create a classified website.

Ultimately, the Joysale may provide an enormous range of products to users, all on one site, and the eCommerce script could be altered to avail the features of an e-commerce website. This unification of scripts will result in providing a script with the capability of creating Auction and E-commerce business.

joybid detail page

Albeit, let us look upon how much it would cost to build an auction website.

Cost & Time estimation

The cost estimation to build an auction website depends on the platform you choose.

It may cost $25 per month to create a website creating the website on your own using the WordPress platform. Gradually, it will take you up to $300 per month for more features, better design, added functionalities, etc., it may increase upon your needs.

Also, the time it takes to build would be from months to years.

If you chose to go for a custom or a ready-made solution like Tophatter Clone Scripts, you have to hire a web development company. It would cost you between $30K to $50K for the website, server installation, professional support and much more.

Also, the time it takes to develop the website would be around three to six months.

Note: Hiring a web development company will provide you with a more professional and experienced support team to take care of your website. It is true that it may cost you a slightly higher price than WordPress templates which cost you a sum of money each month. But with a slightly higher price, you will have a better website with no bugs, maintenance, tested, fully functional and a team to take care of anything which comes your way.

periscope clone
Note :

With in-depth market research and analysis, we have presented here the list of all beneficial inclusions that help your business to maintain a competitive edge. These above-mentioned features and functionalities may not be readily available in our versatile script. But, our scalable solution can be customized swiftly and effortlessly to include these additional features and thereby making your business stand out from the crowd. To know more about the cost and time frame for these inclusions in our script, you can contact our customer help desk.

To Sum Up

That’s that… Here I have showcased the topics which revolve around building an auction website like Tophatter. Now it’s your time to sketch it out on a paper and start working on it. Remember, you should do your research, write your ideas and bring your website to reality.

You can go for platforms like WordPress or Shopify to build a website as they do have templates available to build.

Or, you may consider going for a professional web development team for a custom or ready-made solution. It’s totally up to you.

If you opt for a web development team and looking for the best to outsource your project you may contact us with your requirements. We may bring your dream to reality.

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