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INTRO How to value a website for sale?

Webpreneur123

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Sep 22, 2018
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I am looking to sell a website that makes some money from mainly Adsense. I was wondering how you would value a content site that I feel is much more valuable than just simply the revenue it is currently generating.
 

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Try finding past sales numbers.

Web properties usually go for 1-3X net earnings + owner benefit.

So if the property nets $50K a year, you're looking at a value of $50-$150K.

I would put it on the lower end since all the revenue comes from ONE source and clearly the property violates control. If Google penalizes the property (or algo changes) you could go from $50K/year to $10K.

Can you provide the some details/figures for the website?

People here would be happy to make guesstimates.
 
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Webpreneur123

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Can you provide the some details/figures for the website?

People here would be happy to make guesstimates.
The site has made about $1500 last year. I personally feel the site is worth significantly more than 3 times yearly earnings. It's a quality site, and it has a very strong RPM which has been very consistent over the years. The traffic has fallen quite a lot because of very strong neglect over the past few years. But it is the type of site that will recoup traffic and earnings very quickly provided it is updated regularly.

It has made a 10s of thousands of dollars (much of it profit) over the last few years.
 

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It’s probably worth $1000. In that profit range you aren’t getting anywhere near 3x, maybe 1.5x at the most.

It doesn’t matter what it used to make or could make.

You neglected it so you expect others to pay for your lack of work in the past years?
 

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All e-commerce and AdSense sites I've seen through brokerages are 1-3x, like @MJ DeMarco said.
You won't get on a brokerage site because your numbers are too small. Your looking at Flippa, etc where you can list it yourself. You can always list it high and see what you get.
Without recent income, I don't see any reason to believe your multiple will be higher
 

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I personally feel the site is worth significantly more than 3 times yearly earnings.
I personally feel this drawing i made of my poodle is worth more than the 3 bucks some jerk offered me! don’t mean people are gonna pay more though

sorry that’s a harsh way to put it but what matters is profitability
 

minivanman

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lol Yeah, we always feel something is worth more than what the buyers want to pay for it but unfortunately, most times that just isn't true. I might give you $1500 right now. If you're interested, send me a message. Ya never know, I might offer more.... who knows.
 
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Webpreneur123

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Sep 22, 2018
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The site is worth much more than the common multiples offered because it is a quality site, not your average made-for-Adsense stuff that attracts 1-3 times revenue. The site offers an excellent RPM which has been very constant over the years. Just requires greater effort to be put into it and the traffic and revenue will rise back up very quickly.
 

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The site is worth much more than the common multiples offered because it is a quality site, not your average made-for-Adsense stuff that attracts 1-3 times revenue. The site offers an excellent RPM which has been very constant over the years. Just requires greater effort to be put into it and the traffic and revenue will rise back up very quickly.
This is not my area of expertise but from a business standpoint here’s what I see.

If I were ever trying to sell a website I would hope that I out of anybody else on this forum I could get @MJ DeMarco and @biophase to weigh in. They have and you are disagreeing. Do not expect anybody else here to suggest a higher multiple.

The fact that you think it is worth more is not a valid business argument. Also, the fact that you have neglected it despite the potential you say it has is questionable. If it is worth that much more, stop neglecting it, build the revenue back to where it was and then sell it.
 

mikey3times

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I personally feel the site is worth significantly more than 3 times yearly earnings.
You might be right. However, you have to find someone who also thinks it is worth more AND is willing to spend that much. You might find a newbie on Flippa willing to buy it for more than it is worth.

If I think it is worth more, but the market disagrees, then why would I pay more? That would be stupid. Especially since you readily admit that it requires an investment to get it going.

The truth is what the others are telling you. It is worth $1500...if that.

Alternatively, do the math. What do you think it can generate annually if it wasn’t neglected? How much would you have to invest to get it there? Factor in the multiple and go from there. That is what an investor will do.

Annual Profit Potential x 3
minus
Investment Required
equals
Maximum Current Value

That is a bit simplistic because I would want a factor of safety if I was buying the asset, but it will give you an idea of how a real buyer might be thinking.

Edit to add: @Yoda, how do you run the math when you buy a website?
 

Walterbl

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Sep 23, 2018
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Traffic, traffic, traffic. It is the most important metric. Are you sure you can get it to a lot of traffic? Then is good.
 

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biophase

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The site is worth much more than the common multiples offered because it is a quality site, not your average made-for-Adsense stuff that attracts 1-3 times revenue. The site offers an excellent RPM which has been very constant over the years. Just requires greater effort to be put into it and the traffic and revenue will rise back up very quickly.
LOL

A seasoned full fledged online business may have a hard time getting a 3x multiple. You know what gets 5x-6x? A business making over $1M profit a year.

An average made-for-Adsense site gets 1-1.5x.

If we gave you the benefit of the doubt that your website is high quality and content, you might possibly get 2x at the most. But the fact that it's only making $1500, which comes out to $4 a day, is saying low quality. How many ad clicks is that a day? 4 @ $1? 8 @ $.50? 16 @ $.25?

Is the domain at least decent? Is it a .com?

But maybe you could find a sucker on Flippa at 3x price. Many newbies buying websites on there.
 

Kid

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Besides arguments mentioned above, there is problem with "putting in effort" on the website buyer side.

If they would be willing to put effort into something they would do it on their own.

Website buyer mentality is "set and forget".
 
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Webpreneur123

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Sep 22, 2018
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Website buyer mentality is "set and forget".
I very much disagree with this. Website buyer mentality often is and always should be to grow the site. To grow a site requires some work. What business do you know where the intention is to grow and make more money that doesn't require work?

People want good quality sites they can still do well with in 10 years and beyond. This site has the platform to do just that.
 

minivanman

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I very much disagree with this. Website buyer mentality often is and always should be to grow the site. To grow a site requires some work. What business do you know where the intention is to grow and make more money that doesn't require work?

People want good quality sites they can still do well with in 10 years and beyond. This site has the platform to do just that.
A smart person with a great blog, all content based no black hat and not much SEO..... this can be done within a few months and left for 10+ years if done correctly. What you might have is an authority site and that requires work. Not saying an authority site is bad but you asked, "What business do you know where the intention is to grow and make more money that doesn't require work?" and that answer would be what I just gave you. Both can make lots of profit.... although I'm not in love with Adsense but that can be changed.

Is your site a secret or can I look at it?
 
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Webpreneur123

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Sep 22, 2018
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Is your site a secret or can I look at it?
It's no secret, I have it listed on Flippa. It's in the health category. I didn't know how to value the site so sought opinions here.

But the 1-3 year revenue model implies every business is the same. I know there are people (by looking up on the net) who pay much more for businesses and even sites they feel they can really work with and take it to the next level or two up.

The great thing about this site is that it has made near on $1000 a month before. And although the traffic has gone down owing to neglect, the RPM has pretty much remained the same over the years. It just needs someone to work on the site and boost the traffic back to previous levels. I am also not very good at SEO. These two things mean a new owner will have ample opportunity.

Sorry, I disagree with the person above who says someone could create a site earning similar levels within a few months. One, these days Google usually takes almost a year before it even gives you a footing in the search engines let alone rank well. This is where a good established site comes to the fore. You already have search engine rankings, traffic and revenue. One just needs to work with it and reap the rewards.
 
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MJ DeMarco

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If you know everything about selling a business, and the people here who have ACTUALLY SOLD businesses (and bought them as well) don't, why bother asking?

Are you here for reality, truth and information? Or just to confirm your biases?

Your site is worth 1-3X it's NET EARNINGS. If your site is so great, quality, better than normal, then you will get something on the higher range.

If you can get anyone to pay more for it, then you found a sucker who doesn't know a thing about business valuation...

If you still don't agree, post the Flippa listing and we will tell you exactly what we think. There are a ton of people here who have bought/sold businesses, and not 4 figure businesses, 7 figures and beyond.
 

biophase

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So I just did a quick search on flippa. I put in sites making between $100-$250/mo. Sorted by highest price to see what has bids or sold. Two sites sold or have bids over $4k of the 29 that showed up. Hope that one is yours.
 

biophase

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It's no secret, I have it listed on Flippa. It's in the health category. I didn't know how to value the site so sought opinions here.

Sorry, I disagree with the person above who says someone could create a site earning similar levels within a few months. One, these days Google usually takes almost a year before it even gives you a footing in the search engines let alone rank well. This is where a good established site comes to the fore. You already have search engine rankings, traffic and revenue. One just needs to work with it and reap the rewards.
Sooo... you sought opinions here from others who have experience and then disagree with them. But that's fine, we will see what the market says.

On your second statement, "I disagree with the person above who says someone could create a site earning similar levels within a few months", someone can easily create a website make $125/mo within a month or two. Notice you are basing your opinion based on how long it took you to do it. You disagree because you cannot do it. So I guess it's impossible.

I don't think it's impossible to get a company to $1B in 18 months just because I don't know how to do it.
 
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Webpreneur123

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Sep 22, 2018
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So I just did a quick search on flippa. I put in sites making between $100-$250/mo. Sorted by highest price to see what has bids or sold. Two sites sold or have bids over $4k of the 29 that showed up. Hope that one is yours.
I guess I wanted confirmation because this is a business and entrepreneurship-centric forum where people might be clued into this sort of things.

I know the kind of sites on Flippa that get the 1-3 year valuations. Most are made-for-Adsense stuff which have do not have a great future. People are just buying for the revenue, hoping they will boost it a bit more and make back what they paid and some. I am confident in saying this site is not in that category.

On a completely different scale, Amazon is likely to make around $10bn profit this year but will likely have a market cap over $1 trillion, which if my maths is correct, equates to a valuation of about 100 times profit.
 

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mikey3times

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I hope you eventually share how much you sell for and what you did to get that price. It will be a great case study for others.

There are always outliers. I honestly hope you prove us wrong.
 

MJ DeMarco

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Ditto.

On a completely different scale, Amazon is likely to make around $10bn profit this year but will likely have a market cap over $1 trillion, which if my maths is correct, equates to a valuation of about 100 times profit.
Yes, and Amazon has a MOAT and took two decades to build -- it is a significant asset -- your website takes 2 minutes to copy. It offers nothing unique, new, and has no assets other than a Google ranking that can disappear in 2 minutes.

Comparing a public company to your $100/mo Adsense website is like comparing a flat-tire in a junkyard to a new Ferrari sitting in a showroom.

I guess I wanted confirmation because this is a business and entrepreneurship-centric forum where people might be clued into this sort of things.
Yea, we're just a bunch of neophytes that don't know what we're doing. Never-mind that you've already had multiple people (including myself) with experience in buying/selling web assets.

We've sold businesses. We've bought them.

The problem is, you just don't like the answers you're hearing because you're a typical delusional seller who thinks his 2006 Chevy Malibu is worth $100K because you shampooed the cloth seats and hung an air-freshener on the mirror.
 

biophase

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I guess I wanted confirmation because this is a business and entrepreneurship-centric forum where people might be clued into this sort of things.

I know the kind of sites on Flippa that get the 1-3 year valuations. Most are made-for-Adsense stuff which have do not have a great future. People are just buying for the revenue, hoping they will boost it a bit more and make back what they paid and some. I am confident in saying this site is not in that category.
Since I have nothing better to do at lunch I took a look at your website. Now I can confirm that it is the exact definition of an Made for Adsense (MOA) site that has nothing special about it.

First, like many MOA sites, your posts have no date on them. This is because you don't want people knowing how old these posts are.
Second, you have no authorship or authority on any of the posts. Who is writing these general articles?
Third, your ad placement is horrible. You should really be making more for the amount of traffic that you get. The problem is that your ads aren't relevant to you topic by more relevant to my browsing history. I don't know if this can be controlled in adsense since I haven't had an MOA in many years.

How is a potential buyer NOT buying your site for revenue? This is not a site that a buyer can churn content by himself. It's so broad and he will definitely pay for content. A better site to sell would have been a tighter niche in which the new buyer has knowledge and can expand on, not a general site clearly done with paid articles.
 

MJ DeMarco

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Since I have nothing better to do at lunch I took a look at your website. Now I can confirm that it is the exact definition of an Made for Adsense (MOA) site that has nothing special about it.
How'd you get a link? I didn't see one in the thread.
 
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Webpreneur123

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MFA sites barely have 10-15 seconds per page. My site, on the other hand, has almost 4 minutes per page on average. That's because lot of my pages (certainly not all) provide the visitors with the information they are looking for. The site has hundreds of genuine user comments, something MFA sites do not have. Just because a site is broad doesn't mean you cannot write authoritatively, through a combination of knowledge, research, or both. The days of tiny niche sites are over anyway.
 

biophase

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MFA sites barely have 10-15 seconds per page. My site, on the other hand, has almost 4 minutes per page on average. That's because lot of my pages (certainly not all) provide the visitors with the information they are looking for. The site has hundreds of genuine user comments, something MFA sites do not have. Just because a site is broad doesn't mean you cannot write authoritatively, through a combination of knowledge, research, or both. The days of tiny niche sites are over anyway.
I think he is the one thing you aren't quite understanding. It doesn't matter if they are staying 4 minutes on your site. What matters is how many ads they are clicking. In fact, I would venture to say that you don't want them staying that long, you'd rather serve them an ad and have them click away instead.

What is your repeat visitor rate?

I mean we are talking money here. So all a buyer is going to care about is $$. You have to prove to the buyer that he/she can make money with your website.

The problem is your ads aren't targeted. That's why you aren't getting enough clicks. If I was reading a long article about mountain biking that kept me there 4 minutes, I'm not clicking on random ads. But serve me an ad about new mountain biking gear and I may click over.

When I was selling my business, I did not put any text about potential in it at all, because I didn't feel that my buyer should pay for potential. They should pay for what it is and is currently doing. They know that they got potential, but I never had to mention it and still I got top dollar for it.
 
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Webpreneur123

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The site is already a proven money earner. The RPM is excellent which has been the case throughout the site's existence. The site is making money, has a good history and due to consistently high RPM, the buyer will need to focus on improving traffic. Take the traffic to 1500 to 2000 uniques/day and we are talking $500-$600 a month revenue.

I don't want people to be just clicking away. Google doesn't like sites that are plastered with ads. Having a good user time means you can sell other types of ads on top of Adsense.

Regarding the ads, they are both contextual and interest-based. Adsense serves what it feels will attract the best revenue at that point in time. To one user it may serve a contextual ad and to another an interest based. There is also Media.net (which serves Bing and Yahoo-powered ads) which always serves ads based on the content of the page. Some people do well with it and some don't. Adsense is generally better but Media.net can do better with high paying niches like health, finance, etc provide d the site is good quality. In any case, the RPM is very good already with Adsense.

I haven't focussed on Amazon at all. Amazon has a very high conversion rate. It is possible to create a new section within the site to generate Amazon commissions by targetting low competition terms.

A good chunk of the site is on mental health, so it is possible for anyone taking the site on either to concentrate on mental health topics (it's a substantial niche with all the different types of mental health conditions, drugs/medications, related topics, etc) or cover a wide array of health topics.
 
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