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Google AdSense Forum

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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?

 

hunderdown




msg:1337892
 7:52 pm on Jun 30, 2005 (gmt 0)

Have they made an offer? They might see its value as higher than you do.

ganderla




msg:1337893
 7:53 pm on Jun 30, 2005 (gmt 0)

I have been looking at the pricing of sites and this is what I would come with.

Senario #1 - $20 a day=600 a month=$7200 yearly earning.
Senario #2 - 1000 pages of original content = I would not sell for under $30,000

Atomic




msg:1337894
 8:00 pm on Jun 30, 2005 (gmt 0)

Senario #2 - 1000 pages of original content = I would not sell for under $30,000

Indeed. If it's quality content you should be able to work it to where you get far more than $20 a day. Don't let them rip you off.

Rodney




msg:1337895
 8:02 pm on Jun 30, 2005 (gmt 0)

Here's an interesting post about potential future earnings that may be worth looking at: [webmasterworld.com...]

moneyraker




msg:1337896
 8:11 pm on Jun 30, 2005 (gmt 0)

I did some readings on this before and most of the inputs I got is that websites are normally bought at 2X to 5X of its annual income. 2X if there's no more potential of growing the income, 5X if there is still potential of growing the income. In your case, therefore, you're looking at 14.4K to 36K. These are inputs from various forums, so I can't vouch for the truth in these guidelines.

You must keep in mind though that the highest price that you can get is the highest price that your buyer is willing to pay. You must try to find out how they're planning to use it. They might have an idea on how to generate $5K per month from your site, in which case you can jack up your price a little bit more! :)

joeking




msg:1337897
 8:12 pm on Jun 30, 2005 (gmt 0)

"Senario #2 - 1000 pages of original content = I would not sell for under $30,000"

You've obviously never worked in the publishing industry!

linuxguy




msg:1337898
 8:12 pm on Jun 30, 2005 (gmt 0)

30K I could use on making other websites, or improve current ones. See my point? The investement could actually make more money.

Freedom




msg:1337899
 8:23 pm on Jun 30, 2005 (gmt 0)

Websites of this caliber are 9 out of 10 times bought for 1 years income or less.

linuxguy




msg:1337900
 8:23 pm on Jun 30, 2005 (gmt 0)

You must keep in mind though that the highest price that you can get is the highest price that your buyer is willing to pay. You must try to find out how they're planning to use it. They might have an idea on how to generate $5K per month from your site, in which case you can jack up your price a little bit more! :)

Also as a investement, they could have ROI on less than 3 years for sure. Now if you compare the investement of 20.000 on other more common business models, how soon will you have ROI?

chicagohh




msg:1337901
 8:43 pm on Jun 30, 2005 (gmt 0)

Freedom is spot on. Actually, he may have been generous - 100% of the adsense sites that I have tracked over the last year sold for less than 12 months.

30k talk is just smoke. It won't happen unless you stumble upon a clueless buyer with 30k - not likely.

A closer estimate would be 10 months income. Unique content is just not that hard to aquire.

uk_webber




msg:1337902
 8:52 pm on Jun 30, 2005 (gmt 0)

I am sorry but it is only worth what it makes today and not what it might make! Therefore it is worth 20 x 365 = 7300

I would say that even at this it is overpriced.

Swebbie




msg:1337903
 8:58 pm on Jun 30, 2005 (gmt 0)

I'll throw out a word of caution, since no one else has...

They could be "phishing" for how much money you make on AS so they can steal your content and set up a quick site to bang out the bucks. This is not farfetched. I've been approached on a few of my sites too, but I keep that info close to the vest. I personally know some folks who have had content stolen for this purpose, and in each case it was suspiciously shortly after divulging what they made on the site to someone who approached them, got their details, and were never heard from again. BE CAREFUL!

Freedom




msg:1337904
 9:02 pm on Jun 30, 2005 (gmt 0)

Swebbie is right. Be careful. I get those not really serious but "hey, I wanna buy your site, what's your income?" type emails.

Also, I sold a popular niche website in January for $16,500 which was averaging $60/day. That was the best I could get it for from 3 offers.

This 3 years income, or 2 years income is just crap. This is not a brick and mortar business, not by a long shot. Websites are very unstable and dynamic. You only have to read the Google news forum or this forum (see the recent asianguy thread) to see what i am talking about.

europeforvisitors




msg:1337905
 9:09 pm on Jun 30, 2005 (gmt 0)

Unique content is just not that hard to aquire.

Not all "content" has the same value.

Getting back to the topic of this specific site, a prospective buyer needs to consider whether the site's content has intrinsic value that can be monetized from other sources if AdSense income or current affiliate-program revenues dry up. The more closely the site's content is tied to a specific revenue source, the more risk the buyer faces.

charlier




msg:1337906
 9:10 pm on Jun 30, 2005 (gmt 0)

I think Freedom has hit the nail on the head in pointing out its not B&M. The major question is not how much it makes its how risky it is. If it was sure to make that income into the future it would be worth >5 times earnings as that would be near to a 20% annual return on investment. 10 year treasuries are paying less then 5%. The difference is the risk

Swebbie




msg:1337907
 9:12 pm on Jun 30, 2005 (gmt 0)

I have a $40/day site that I'd gladly part with for $10,000 (250 days of income). That's a good deal for me. I can take that money and invest it back into site development and easily make twice that amount back within a year or so. Once you sort of "get it" about how to build and promote a site, it's an assembly line kind of thing. Any takers? :-)

linuxguy




msg:1337908
 9:14 pm on Jun 30, 2005 (gmt 0)

I am sorry but it is only worth what it makes today and not what it might make! Therefore it is worth 20 x 365 = 7300
I would say that even at this it is overpriced.

Why do you think is overpriced without actually seeing the website? Is every website worth X * 365?; I say no. Of course there is much risk attached to being totally adsense based, but still why only one year?

incrediBILL




msg:1337909
 9:18 pm on Jun 30, 2005 (gmt 0)

I am sorry but it is only worth what it makes today and not what it might make! Therefore it is worth 20 x 365 = 7300

Yes, a lot of unique content could be written for hire for $30k or even $7K for that matter, but does that make something already available, ranked and getting traffic worth less? I would think it makes the existing site worth more just because you're a known quantity, ahead of the curve and it would take months to a year just to catch up in the first place.

Besides, you NEVER open with what you're really willing to actually sell for, you open high and see where the bidding takes you. If they only want to buy it for chump change I'd hold it, beef up the earnings for 6 months and roll it out for sale again as you have the upper hand and the potential buyer would be playing catch-up unless they know SEO way better than you do which is always a risk.

I've walked from a $400K offer once but it was part stock, part cash, no thanks.

linuxguy




msg:1337910
 9:25 pm on Jun 30, 2005 (gmt 0)

I have a $40/day site that I'd gladly part with for $10,000 (250 days of income). That's a good deal for me. I can take that money and invest it back into site development and easily make twice that amount back within a year or so. Once you sort of "get it" about how to build and promote a site, it's an assembly line kind of thing. Any takers? :-)

Just let me sell my $20/day site for 15000 and Ill be happy to buy yours!

I guess It goes all back to offer and demand.

moneyraker




msg:1337911
 9:36 pm on Jun 30, 2005 (gmt 0)

Freedom has a real experience already on selling a site, so I'd value his input anytime.

At any rate, just for the sake of discussion, suppose that I have a site that earns $10K a month. If I sell it for $120K now, I think I would not be able to build a site that earns $10K a month within 12 months, even if I have $120K at my disposal. I think that most of the 10K sites are not 10K sites when they were just 12 months old.

My point is that a high-earning site should get more premium than a low-earning site, because it has already survived many obstacles and overcome many competitors. In short, it has been naturally selected already in the cyberworld.

Swebbie




msg:1337912
 9:43 pm on Jun 30, 2005 (gmt 0)

That's a valid point, moneyraker. And it may also be that a site making big money has an owner spending a good portion of it to get all that traffic (AdWords, Overture, etc.). One shouldn't simply assess the revenues a site brings in, of course.

Sweet Cognac




msg:1337913
 10:06 pm on Jun 30, 2005 (gmt 0)

Do they have any idea what you make a day with Adsense? I'll bet not! The fact that they have even approached you, should tell you that you own something of great value, and they want it! (What's the alternative? They scrape your content for free?)

If you have a 1000 page travel site with original content, you should be making more than 20 bucks a day. (But they don't know this. Tell them you make $100 bucks a day, and if they want to match it for a year you'll sell.)

or... ask them to "Make you an offer you can't refuse" and see what happens.

What's your PR?

hyperkik




msg:1337914
 10:38 pm on Jun 30, 2005 (gmt 0)

If you have a 1000 page travel site with original content, you should be making more than 20 bucks a day. (But they don't know this. Tell them you make $100 bucks a day, and if they want to match it for a year you'll sell.)

There is such a thing as "due diligence", and anybody looking at buying a site should investigate and verify any representations made by the seller. There's also such a thing as fraud - and getting a buyer to rely upon figures that you cannot later prove to be true, in order to make a sale, could create a headache you don't want.

Sweet Cognac




msg:1337915
 11:01 pm on Jun 30, 2005 (gmt 0)

Ok.. that makes sense. But still, if they are asking him to sell, they must have notion of what he might take for it? Why are they asking him what he wants for it?

Did they say:

We're interested in buying your website, what do you want for it?

I would have probably said, "What will you give me for it?"

And then figure out in my head whether it was worth selling.

(If I were him I wouldn't sell)

MichaelCrawford




msg:1337916
 11:14 pm on Jun 30, 2005 (gmt 0)

It really made me stop and think, when someone said a site with growth potential could be sold for five times its annual revenue. I have only barely begun to develop the ad revenue potential of my site, as I have previously used it to represent my brick-and-mortar business on the web. Even so, my July revenue will be a few dollars short of five thousand dollars.

If that persists, then my site's annual revenue would be sixty thousand dollars, suggesting I could cash out for three hundred grand.

My wife's jaw hit the floor when I told her that.

We briefly entertained the idea of selling it and using the money to start some other site, but I think I would be much better off in the long run to develop the site. If my site has the potential to be worth three hundred grand to someone else who might grow it, what would it be worth to me if I grew it myself.

However, I pointed out to my wife that if something happened to me, she could, if she chose, cash out and buy herself a house and have enough money to finish her degree.

Up until now I didn't think there was a lot of point to drawing up a will, as I didn't think I had any real assets, but now I realize I do. I'm a recent immigrant to Nova Scotia, Canada, so I don't know much about inheritance laws or estate planning here. I'm going to do some research (I have a friend who used to do estate planning professionally) and then do what the experts advise.

I know from a book I read by financial guru Suze Orman that wills aren't actually the best thing if you have a lot of assets, because there are probate fees and the inheritance can be tied up for a long time, possibly a time of great need. Better than a will is a trust, at least in the US. I expect Canada has such things. I'm going to find out... and soon.

Being the sole provider for my student wife, and loving her very much, I'm a lot careful now when I drive my car, or even cross the street, than I was before we were wed.

incrediBILL




msg:1337917
 11:14 pm on Jun 30, 2005 (gmt 0)

I would never disclose anything to a potential buyer except MAYBE my traffic figures (which are on the site's advertising page anyway) until they signed a letter of intent and an NDA.

sailorjwd




msg:1337918
 11:23 pm on Jun 30, 2005 (gmt 0)

Oh great Bill. Every time I sneeze I have to give either my lawyer or accountant $500.

Has anyone let their lawyer handle everything?

dataguy




msg:1337919
 11:23 pm on Jun 30, 2005 (gmt 0)

I was one of the first people to sell websites on ebay (started in 1997) and I've sold over 100 webs sites since then. Many times I have had people offer cash for a web site that I thought was a good price, but I decided to hold on to it because if they wanted it so badly, it probably would be worth more if I held on to it a little longer. Every single time I ended up selling these sites for much less than I was originally offered.

Times are different than they were just a few years ago, and I haven't tried to sell a web site in over a year and a half, but I still think that with the speed in which things change on the Internet, when you are made a good offer on cyber-property, you should take the money and run with it.

YesMom




msg:1337920
 11:28 pm on Jun 30, 2005 (gmt 0)

I recently offered to buy a friend's popular PR4 site when she just needed money. I suggested AdSense to her, but she didn't get it... and was excited for the $500 cash I was able to afford at the moment.

I put up AdSense and it began generating $80 a month immediately. I'm thrilled with my investment that will be paid for in 7 months. :-)

My latest addiction is scouring the internet for decently linked sites that *I* really find valuable for the content and potential, but haven't yet discovered AdSense. Then I check them out on DigitalPoint's sandbox tool to preview what ads would be shown on the site.

After I am satisfied it will have excellent potential for development, I write to the webmaster and compliment them on what a great site they have. I ask them to print out and keep my email for a time when they might need to retire from being online... that I'd be more than willing to make them the best offer I can for their site and keep it running with the same content and the original author's intent.

I had one so far that met the criteria and he HAS been considered "retirement" and will be contacting me eventually. :-)

I'd love to add more $80+ a month sites! Never know when one will be a bigger surprise than that even.

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