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So, I Got An Offer to Sell My Business... (I'm 25 Years Old)

CareCPA

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The way to deal with that is have them put part of the sale price into an "immediate" annuity (or more than one if deferring parts for multiple years). Set the annuity's payout option so that it defers payment 1,2,3, up to 20 years, depending on what you're trying to do. The annuity should be guaranteed by an A+ rated life insurance company, so you have a state guaranty fund to fall back on in the unlikely event the carrier fails.

That's how I've seen it done anyway. IRS is supposed to treat this as an installment sale for tax purposes, but no broke buyer to chase down. M&A life hacks.
Interesting, I'll have to check that out.
Normally Seller-financing happens because the Buyer can't get enough funds from the bank. I can honestly say I've never seen it used like this by the Seller.
 
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lludwig

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As someone who has sold an affiliate blog for $6M in 2018 I know a thing or two about affiliate site valuations.

Your evaluation at that income level is 3-5x TTM. More than likely on the low side of 3x OR around $350k valuation. Unless you have some unique value adds. Though for most buyers it really just comes down to two things:
  • Traffic
  • Revenue
 

lludwig

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Let me add your average revenue per visitor is around $0.07. Really low IMHO even for your niche and I think it's under-monetized. At that rate you could almost put up ad banners to make the same or more money.
 

valuecreator

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you never gonna get 1Mil for that but maybe half that if you find the right sucker.

It Depends on your vision and where you want to get and if you like doing that at all.

Personally, it doesn't even classify as a business, so I would sell and look for more passive ways to generate income.

What I mean is: I doubt that if you walk away from what you're doing for a year, the revenue would have grown in your absence. That's a business. The rest are just jobs or gimmicks.
 
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Entre Eyes

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First of all congrats.....Age 25 or not you fall into the Entrepreneur Vets category. :)

But you really need to be addressing Website Brokers. Start out with their valuations.

Also take a peek at the recently sold pages.

If you get a chance visit Jay Abrahams site he will show you all types of ways to see value in a business that is not so obvious at first.

I would say you are where alot of people want to be right now.
 

Lunamoonbay

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Hey, I am currently listing my business for sale, too. The main thing they are looking at is your actual income(after all the expenses) and then they determine the x based on the evaluation. How they evaluate is different firm by firm but after all you might want to find a business broker to help you to get an estimate. The process should be free. Based on what I learnt so far, assume they determine your actual income is $100.000, and you own a "perfect business", best you will get is 3X. Business makes over $600,000(again, your actual income), can really shoot for 4x-6x or even more. Good luck!
 

Knugs

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Hey, all. I just got an offer from someone to buy my business.

I've had people interested in it before, but the deals didn't pan out.

In a nutshell, I'm wondering how to valuate my business. I've seen all kinds of different formulas, and have no clue which to use.

Here's some quick stats:
  • Industry Stats
    • Affiliate Advertising Industry
    • Health/Fitness & Self-Help (Dating, Making Money, etc.)
    • Website Niche is Very Versatile, So Can Be Monetized w/ Almost Anything
    • Growing Industry (All Online)
  • Website Metrics
    • 120,000 New Users/Month
    • 2018 to 2019 Unique Users Growth: +693%
    • 2019 Q4 to 2020 Q1 Unique Users Growth: +198%
  • Income Metrics
    • Earned ~$111,000 in 2019
    • 2018 to 2019 Net Revenue Growth: +61%
    • 2019 March to 2020 March Net Revenue Growth: +157%
    • 2019 Q4 to 2020 Q1 Net Revenue Growth: +47.7%
  • Operating Costs Metrics
    • 2019 Baseline Operating Costs: $1,100/month
    • 2018 to 2019 Operating Costs Growth: +5%
Obviously this is a very prime business for someone to buy, because of the extremely rapid growth rate and low overhead.

I've seen estimates anywhere from $500,000 to over $18,000,000 depending on the calculators I use, lol. So, I'd appreciate some help.

My business is growing extremely rapidly, so unless I get a really good offer, I probably won't sell. That being said, a good offer of $1,000,000+ could give me a ton of nest egg money to start a new business venture, and this time, I'd be starting one with all the experience I have, so it would end up growing 10x faster than my current business did.

This is a very key moment in my career, especially because I'm only 25 years old, so this decision could have a very long-lasting impact. Hence, why I'm here - to see if I can gleam some advice from entrepreneurs who have not only talked the talk, but walked the walk.

Any help from the veteran entrepreneurs here would be much appreciated! Thanks, guys :)

Just out of curiorisity: what was the offer you received, and how did this end up?


nice first comment.
 

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