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Google AdSense Forum

This 164 message thread spans 6 pages: < < 164 ( 1 2 3 4 [5] 6 > >     
How much is an AdSense website worth?
linuxguy




msg:1337891
 7:48 pm on Jun 30, 2005 (gmt 0)

How could you calculate how much is a website worth based on the potential of ppc advert and aff programs? Some one is interested in one of my websites, I only make about $20 dollars a day out of adsense on it. Its got a bit over 1000 pages of spam free travel related original content, with only a few high quality incoming links.

Perhaps I could cash the next 3 years at this level on one sale? That will make me $18000 today which I could use to improve my other websites and create more. The thing is that Im sure the site will increase its earnings as is becoming very popular on its area, so Im not sure on what to do! How much to ask, to sell or not to sell?

 

joeduck




msg:1338011
 4:36 am on Jul 7, 2005 (gmt 0)

excellent points red_eagle

In conventional business revenue *stability* is easier to assess than for a website. Traffic will vary and is often affected by PPC spending and activity from other sites that may go away after the sale, so you need to balance any revenue projections against this.

joeduck




msg:1338012
 4:42 am on Jul 7, 2005 (gmt 0)

Your ego is writing checks your ass can't cash.

I'm still trying to figure out your exact meaning, but it's sure a great sounding quote!

Broke? CLICK HERE for Ego Ass Cash

SlyOldDog




msg:1338013
 6:28 am on Jul 7, 2005 (gmt 0)

>>Your ego is writing checks your ass can't cash

Heh, well maybe I will write some right here. I have money to spend on sites with diversified income streams.

Sticky me if you want to sell your site. 2 types I would buy

1) in a niche with original content and with not only AdSense as an income source, and with some growth potential.

2) Sites out of the sandbox with no income.

maximillianos




msg:1338014
 12:29 pm on Jul 7, 2005 (gmt 0)

Another potential value to consider above and beyond the base revenues are upkeep. If I am selling a site that maintains itself (community grown content and policing) versus a site that I must add content and maintain, then we are talking about time. And time is money as well.

rocco




msg:1338015
 5:05 pm on Jul 7, 2005 (gmt 0)

i pay 3-6 times monthly income - but some things can make the site more expensive, like:
good domain name
good content
growing community
...

chicagohh




msg:1338016
 5:08 pm on Jul 7, 2005 (gmt 0)

Arbitrary values for each page (or a site) seems like an easy solution for sellers, but it is pretending that the reason for the success of an Adsense site is the site itself. An Adsense site is only partially responsible for it's own success.

Adsense is very popular becuase it makes earning money easy and lucrative - much more so than most all other venues. Without Adsense these sites plummet in value. We don't know what the future holds for Adsense. With all the click fraud out there we may have an entirely new business model that may or may not perform as well.

Adsense sites are only making money because there are advertisers willing to pay for ads to be delivered to your site. Many brand name companies are fighting a battle with online retailers versus brick and mortar retailers. I know of several popular categories where the brand owners are doing quite well in banning online sales from all but a select group. When this happens, Adsense income goes way down. I know this from personal experience on multiple sites.

As a site owner you have zero control over the industry.

Anyhow, all arguments aside - Adsense site are selling in the range that has been quote here. If someone has verified data to prove otherwise - I would love to see it. With rare exception it doesn't matter what you're bringing to the table or how many years your site has been doing it - the market says 7 to 12 months.

Jane_Doe




msg:1338017
 5:32 pm on Jul 7, 2005 (gmt 0)

the market says 7 to 12 months.

If you are calling "the market" the web sites for sale that churn on the popular auction sites, many of those sites are made for adsense sites that are pretty junkie. I personally would not pay even 12 months income for most of those.

It's a big web. There is no single market like the New York stock exchange. So when you say "the market" do you mean what sites sell for on place like Ebay and Sedo? With web sites as with other purchases, you tend to get what you pay for.

vincevincevince




msg:1338018
 7:45 pm on Jul 7, 2005 (gmt 0)

The vast majority of sales are purely private affairs and are without any public disclosure, especially where community is involved.

A high proportion of sales include a retainer for the previous webmaster to continue maintainance and or growth work under new direction.

chicagohh




msg:1338019
 9:02 pm on Jul 7, 2005 (gmt 0)

So when you say "the market" do you mean what sites sell for on place like Ebay and Sedo?

No. You can't trust what you read on those sites. At least on eBay, you run into a lot of shill bidders. I sell sites all the time and would love to know where everyone is selling their sites for 24x income...

universetoday




msg:1338020
 10:17 pm on Jul 7, 2005 (gmt 0)

In the traditional business world, the whole point of making an acquisition, in theory, is that you can use your money to purchase some technology, business, etc, and leverage it with something you already have.

When valuating a website for purchase, you need figure out what the site is capable of earning once you bring in your leverage - better technology, similar base of visitors, etc. Can you make the site do better than it's already earning?

If you're looking to sell, the decision is simply: how much are people willing to pay? You might think your website is worth 5x annual earnings, but only if someone will actually buy it for that. In general, be conservative in your expectations, and work like crazy to shore up many of those issues that improve a valuation: multiple revenue streams, different traffic sources, etc.

rsequin




msg:1338021
 5:09 am on Jul 8, 2005 (gmt 0)

Funny that no one really mentions the value of the domain name. I have sold many domains that have been reported in the popular Domain Name Journal and they were simple keyword domains.

I never had to give out any traffic or revenue info.

Waterfront land (good keyword domain) goes up in value. Houses (content) will look run down if you don't mow the lawn and keep them painted.

The domain business is VERY much like the real estate business.

So, if you buy good land and build a nice house AND keep it maintained, people will want to pay you a lot for your house...unless of course you want to leave it to your kids.

chicagohh




msg:1338022
 5:15 am on Jul 8, 2005 (gmt 0)

Funny that no one really mentions the value of the domain name.

Probably because the post is about the value of an Adsense website. If I have a domain with targeted type-in traffic (which I do) I can find *much* better ways to make money with it than Adsense.

oddsod




msg:1338023
 8:58 am on Jul 8, 2005 (gmt 0)

So when you say "the market" do you mean what sites sell for on place like Ebay and Sedo?

Surely by "market" he means the entire market ... and not just eBay? ;)

--The traffic sources -- Traffic stability -- Opt-in E-mail lists --SE traffic --Is there are forum with lots of users? --Advertisers -- ...

There are several things you consider when buying a site, the above and lots more. But be carefully not to confuse the risk elements with the earning elements. The earning elements are already factored into the er, earnings.

Gambrinus




msg:1338024
 6:59 pm on Jul 8, 2005 (gmt 0)

I can't believe I read the whole thing.

14 pages and what do you get? Another day older and deeper in debt.

nuevojefe




msg:1338025
 7:16 pm on Jul 8, 2005 (gmt 0)

I can't believe I read the whole thing.
14 pages and what do you get? Another day older and deeper in debt

I can't believe you read the whole thing only to leave that comment.

---

We have had success obtaining higher purchase prices by approaching the advertisers whose ads appear on our site or our competitors. For them it might be worth paying the same multiple everyone else is willing to, + more because they can lower their ad cost and/or put a dent in the competition.

JoeS




msg:1338026
 3:26 am on Jul 9, 2005 (gmt 0)

I was offered 2X revenue for my site. I was insulted because I could just hold onto my site and sit here and make the same amount over the next 2 years instead.

Highway61




msg:1338027
 7:26 am on Jul 9, 2005 (gmt 0)

Gambrinus:

"I can't believe I read the whole thing.

14 pages and what do you get? Another day older and deeper in debt."

Don't feel lonesome. These 10 plus page threads are addictive, but in the end, what do you get? Maybe one or two excellent points, maybe a few above average points, and a whole lot of noise.

I used to visit every day, several times a day, and then I took a step back and asked myself what was more important: reading or doing? I decided to focus my time and energy on writing good quality content every day.

Freedom




msg:1338028
 12:03 pm on Jul 9, 2005 (gmt 0)

I was offered 2X revenue for my site. I was insulted because I could just hold onto my site and sit here and make the same amount over the next 2 years instead.

Why do all the newbies think their site is bulletproof to Algo changes, competition, spam and other disruptions?

Go over to the Google News forum and see how many victims there are of people who thought like you did. (It will never happen to me). Read the threads in this forum where Publishers claim their earnings are down by 50 percent. Read all the "I got kicked out of AS for no reason" threads which pop up at least once every day.

This is a very unstable business and 2 years is a very long time if you are looking for a uniform income.

hyperkik




msg:1338029
 12:45 pm on Jul 9, 2005 (gmt 0)

I was offered 2X revenue for my site. I was insulted because I could just hold onto my site and sit here and make the same amount over the next 2 years instead.

Why do all the newbies think their site is bulletproof to Algo changes, competition, spam and other disruptions?

If that was their first offer, in fairness, his site was probably worth more - the first offer is rarely the best offer. That said, if it happened to me, I would start negotiating toward that higher, mutually acceptable price.

Freedom




msg:1338030
 2:04 pm on Jul 9, 2005 (gmt 0)

When someone buys your website for 2 or 3 x annual earnings, you be sure to let us know but I'll tell you now, it's just never going to happen. Never.

drall




msg:1338031
 2:13 pm on Jul 9, 2005 (gmt 0)

It all depends on your space, we have a couple major properties that many companies have offered 4-6 years worth of earnings to purchase and these sites do not earn low numbers.

Swebbie




msg:1338032
 3:17 pm on Jul 9, 2005 (gmt 0)

I was offered 2X revenue for my site. I was insulted because I could just hold onto my site and sit here and make the same amount over the next 2 years instead.

The "sit here" part is why you'd sell the site for 2X annual revenue. Most of us would re-invest a lot of the sale proceeds to develop new sites or expand other existing sites, with an eye toward overcoming the lost revenue from the sold site asap. In other words, we wouldn't just "sit here."

I know everyone's goals are different, and for some people their website is a labor of love as much as for bringing home the bacon. So I'm not bashing the concept of sitting on a good site and refusing buy-out offers. More power to ya! I'm just explaining that there are other motivations and that 2X offer shouldn't insult you. It should make you proud because it's a testament to the time you've invested in your site. Someone was so impressed, they offered you all that money. Be happy!

Jane_Doe




msg:1338033
 3:42 pm on Jul 9, 2005 (gmt 0)

When someone buys your website for 2 or 3 x annual earnings, you be sure to let us know but I'll tell you now, it's just never going to happen. Never.

The ip site had zero earnings and sold for hundreds of thousands of dollars. Hobby sites with no earnings history get bought all of the time by people who want to put adsense on them.

ken_b




msg:1338034
 4:09 pm on Jul 9, 2005 (gmt 0)

The more I read threads like, the more I wonder about the whole buy/sell thing in relation to sites where Adsense is the only, or main, source of income. That's especially true for sites that get the bulk oftheir traffic from the free serps.

Right now, I wouldn't even think about selling my site for 2x annual earnings. Like another poster said, I'd just sit back and cash the checks as long as they came in.

The checks might keep coming for far more than 2 years, they might not. As things stand today, I'd willing to take that chance.

But here's the thing. I have no reason to sell the site. I like what I'm doing for the most part. I don't "need" the money. I like the money, and I'd rather it kept coming. It's bought us some nice stuff and added a healthy chunk to our cash reserves.

But if I got booted from Adsense today, my biggest issue would be removing the code from 1400+ hand rolled pages. It probably wouldn't affect the operation of the site, most likely I'd just keep on like I was doing before Adsense came along.

For folks in my position, it's easy to be rather cavalier about our expectations and demands.

It's about motivation. We have little or none when it comes to selling our sites. Of course that could always change if our circumstances change.

If a webmaster does "need" the money for living expenses and someone offered 2 years income for a site, I might well say "take the money and run" in most cases!

MovingOnUp




msg:1338035
 5:06 pm on Jul 9, 2005 (gmt 0)

It really depends on the site.

For a site that gets all of it's traffic from a single search engine and all of it's revenue from a single source, I wouldn't want to pay even six months earnings.

On the other hand, a site that has diverse traffic and revenue sources, has consistently grown, requires little or no maintenance, and is in a large industry could easily be worth 10 times annual earnings or more. I have one site like that which I wouldn't let go without an offer in the mid to upper 7 figures.

joeduck




msg:1338036
 5:08 pm on Jul 9, 2005 (gmt 0)

many of those sites are made for adsense sites that are pretty junkie

Right, and this thread seems to be focused on the value of those junky sites. If you have a 'great' site that has growth potential it's worth much more than 6x MONTHLY earnings - certainly I'm happy to pay more than that.

I'd suggest Google's value is it's website and associated technologies. Note that most of their income comes from...adwords and adsense.... Like any public company Google is for sale in the form of shares. The cost is (approx) 117 times their ANNUAL earnings, or 1404 times their monthly earnings. Yahoo's available for about half Google on a price to earnings basis.

The HUGE discrepancy in "small vs large" site value (and large vs large) is very interesting to me and I'd be interested in how others see this shaking out over time.

Freedom




msg:1338037
 5:22 pm on Jul 9, 2005 (gmt 0)

The ip site had zero earnings and sold for hundreds of thousands of dollars. Hobby sites with no earnings history get bought all of the time by people who want to put adsense on them.

...we have a couple major properties that many companies have offered 4-6 years worth of earnings to purchase...

Yes, but these examples are so rare and isolated that it's not even worth discussing here.

Those examples, along with ones in the major media(Picassa, Blogger, Orbis, etc.,) - are such 1 in 10,000/deals in the real world of webmastering that they just skew the market perception into something that it's not. People who have never sold a website, never bought a website, and don't know anyone personally who has done either, are giving their advice here and it doesn't make any sense to me.

Are "you" going to take my advice when it's time to install a new timing chain on your car? Heck no, because I don't know anything about, never done it, and I'm not going to pretend I know what I am talking about - just because I own a car and drive it.

People who say: "wouldn't, couldn't, shouldn't" but have never done anything are not the ones who have the most valuable input.

If one wants to know how to value a website for an actual sale in today's marketplace of buying/selling websites, don't talk to people who have never done it, and ignore the 1 in 10,000 deals like the infamous "IP site that sold on eBay." Go find out from people who actually bought/sold websites. THey can tell you what the market is really like.

Gambrinus




msg:1338038
 9:11 pm on Jul 9, 2005 (gmt 0)

Highway 61:

Ironically you provided me with some of the best advice out those 14 pages in your post in regards to searching out companies whose competitors are advertising at my competitors sites.

I'm not looking to sell, but thought maybe this discussion would highlight some reasons why sites may have more value than others. Freedom, and some of the other senior posters - makes sense- made some great points how to create value and what they look for to determine value in others.

Other than that it was 13.5 pages of people trying to out-brag each other.

I dont come to this site to compare #*$! size. I'm not looking for an easy way out, or an easy way to do things, but rather solid methods and real world experience on which to base my own decisions. This site is the best out there for that as long as you choose your topics wisely.

And another reply was absolutely correct; balance your time wisely for its often better spent "doing" than "surfing."

Cheers

Dpeper




msg:1338039
 9:19 am on Jul 10, 2005 (gmt 0)

My site that I sold, I got what we called an asset payment about 2 and half years of earnings for the site then We set up some clauses for future performance registered users reaching new levels required additonal payment. And I maintained AdSense Adspace for 6 months worked out pretty well. You may want to give them the option to split the payments up over 6 months or so this often allows business to pay a little more as it does not eat up all of there cash at once, alot of companies prefer to do this.

-Donny

kevinius




msg:1338040
 2:40 pm on Jul 10, 2005 (gmt 0)

I think the price of a site is calculable. But the problem that occurs, in calculating that price, is 'who's buying'.

- If you know what they are planning to do with your site, and it sounds like they have some huge plans, your price will go up.

- If you don't know what they are planning or you don't know who's buying, your price will be much lower.

So if you'r buying a site, never say who you are and what your plans will be, as this 'information' will be fundation to determine their price.

linuxguy




msg:1338041
 10:36 pm on Jul 10, 2005 (gmt 0)

Sold the website for $17500 ,

win win situation, there is a lot of pontential in the website and the new owner will certanly take advantage of it. Im sure he will have ROI in a year and a few extra months. Now Im going to use the cash to expand my current websites and hire some help. After this experience Im also selling 2 other sites, they are not as big but in the right hands will cerantly make lots of money. With this cash Ill make myself an authority on my niche,. Thank you all for the great feedback, beers on me folks.

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