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10:41 pm on Apr 6, 2004 (gmt 0)

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Hello,

I'm looking to try and price my site for sale.. I know there are a ton of factors in determining a price.

What is the basic formula, is there one?

I know what the site was making per click.. and how many advertisers were paying that much.

Trying to discover whether the site would be of interest to one of these advertisers.. and how long they'd pay in advance before it's profitable: ie. If the site generates $5000 in sales a month, would they pay $20k, 50k, 100k?

What are the factors I should consider?

Thanks much!

2:49 am on Apr 7, 2004 (gmt 0)

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A lot of it depends on where the traffic is coming from. Is it coming from repeat visitors, from PPC, from generic SERP's etc.? The highest sales value would be from repeat visitors making up most of the traffic, with PPC and generic SERP's type visits comprising less.

Also it depends on where the revenue is coming from. Is it coming from sponsors, visitors who purchase from your site or those who are paying you per click who could pull out of their campaign at a moment's notice?

Depending on many factors, the value could be from 1 month's profit to 1 year's profit for most sites ( your mileage may vary).

4:29 am on Apr 7, 2004 (gmt 0)

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I sold a site around six month ago. I got 14 times the monthly income generated by the site. The traffic was mix of free and PPC. It was a prfitable venture overall but needed continuous attention. I thought, more money can be made by taking different approach. Our URL was mykeyword.com.

I think if site is making money and there are no imminent threats to that industry, you should get anywhere between 10 to 20 months of your monthly income.

7:21 am on Apr 7, 2004 (gmt 0)

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Site averages around 2000 users a day.. about 30% are return visitors (from the day before or the month before I'm not sure).

Can I assume a 1% conversion rate on those 2000 users?

The companies that I'd like to sell the site too sell products around $20 bucks each.

So 2000 users x 1% conversion = 20 purchases x $20 product = $400/day?

Over 3000 pages listed in Google and Yahoo.

Any better idea of the price range now?

11:04 am on Apr 7, 2004 (gmt 0)

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Traditional business methods surely prevail here. If you are selling $5000 of inventory a month and making a $1000 profit.

$12,0000 x 5 upto 10 would price the business value between $60000 and $120000

Real basic but probably not a bad indicator of worth, unless there is some good intellectual property involved then hey.........skies the limit

2:33 pm on Apr 7, 2004 (gmt 0)

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<<Traditional business methods surely prevail here.>>

That simply is not the case at all. Having bought and sold many sites (some for large amounts), I can tell you that in the Internet world, one gets much less than the offline world. This is due to many factors, not the least of which is the youth of the web and the constant change in competition, search engines, and technology.

eljefe is right of course. The source of traffic and actual "value" of your content is quite important. I have "one page wonders" that make thousands per month. If they drop in the search engines, they are worthless.

9:07 pm on Apr 7, 2004 (gmt 0)

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Ok.. This is great input, I appreciate it.

The source of traffic for the site is all search engines.

Around 2000 pages listed in Google and lots more in other search engines.

The site's subject will always be around.

I have log files for the last year.. and the site has grown gradually and consistently during that time.

I'm not selling any products.. but was running AdSense and generating about 1/4 of the "inventory sales" figure you mentioned(per month).

Does this bring a price range into better focus? Thanks for the input.

10:46 pm on Apr 7, 2004 (gmt 0)

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mr fishy you are looking at it as a seller, jump into the head of a buyer and all the basics will apply, what does the site make in profit. Yes I agree that it gets confused if novel IP is also owned but surely to answer this guys question with hard figures it's not bad to use traditional methodologies.
7:45 am on Apr 8, 2004 (gmt 0)

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anxvariety try using your math and give them a number that you think is fair. Without knowing your product, I can't comment on the 1 in 2000 visitors being buyers. With all your traffic coming from search engines I would be hesitant as a buyer to offer more than a few months profit as what happens if that SE traffic dried up for whatever reason?

If I was a buyer I would stipulate that the site must remain getting high SE traffic for X amount of months and that you as the seller would be responsible for it.

9:53 am on Apr 8, 2004 (gmt 0)

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Does anyone know of a site that has been sold.. that is in this 2000 users per day range?

I'd like to check out some sites and what they have sold for.

I checked out a few ''websites for sale sites'' and some of these sites seem pretty dang expensive for how little hold they have on their market and how new the sites are.

Anyone know of a reputable ''websites for sale'' site?

Thanks

3:19 pm on Apr 8, 2004 (gmt 0)

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<<mr fishy you are looking at it as a seller>>

Nah, i buy much more than sell. One popular way as of late is to pay installments partly based on future earnings or traffic.

Buy and sell a few dozen sites and you will quickly see that there are many, many variables - the biggest probably being the domain name/brand and whether there is proprietary/copywrited content or technology. In other words, a business that cannot be easily replicated without great expense.

10:43 pm on Apr 8, 2004 (gmt 0)

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This doesn't specifically relate to websites but I recently went to a seminar on business valuation, and the main point to take away from it is to recognise that every business (website in this case) will have a different value to different sellers.

I think the next most important thing was to consider that you will almost certainly get a better price for your business/website if you actively seek out potential buyers rather than waiting for them to come to you. For example, in an ideal world you would be able to attract a potential buyer operating in a complimentary market (this gives more opportunites for synergies/cross sells to be exploited), also in an ideal world you would attract more than one of these parties to the table to maximise the price.

At the end of the day, your business/website needs to be pro-actively sold just like any other product in order to get the best price for the seller!

11:43 pm on Apr 8, 2004 (gmt 0)

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I have contacted 4 potential buyers and all have shown interest.

My email is basically.. here's my basic traffic.. If you're interested, tell me what you think its worth.

Now I'm waiting for those responses and am going to give a much more specific breakdown of the traffic, growth patterns and sustainability of the site.

Business buffs.. is asking what it's worth a bad strategy/idea?

I have a hard time determining if strategy is even necessary.. since in a market with more than one buyer, bidding will set the appropriate price... and if not, you don't sell.

2:47 am on Apr 9, 2004 (gmt 0)

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anxvariety,

Not to be a "buzz-kill", but everyone is always interested at some price. Most are super lowballers out there.

5:58 pm on Apr 9, 2004 (gmt 0)

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Not to be a "buzz-kill", but everyone is always interested at some price. Most are super lowballers out there.

Most owners ask for insane prices... Just look at auctions on ebay.... hahaha

12:32 am on Apr 10, 2004 (gmt 0)

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....The highest sales value would be from repeat visitors making up most of the traffic.....

I would think that it would be the other way around as repeat visitors might not be very willing to buy what you sell every other week, but someone that shows up for the first time or every few months might be more receptive.

Now, I can see how loyal users might be good on some limited cases, but I would rather have a constant turnover.

1:55 am on Apr 10, 2004 (gmt 0)

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I agree.. I'd rather have constant new users.
3:42 am on Apr 10, 2004 (gmt 0)

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I personally like the recurring revenue customer. Once you have a customer, you keep earning $$ from them.
9:32 am on Apr 17, 2004 (gmt 0)

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Interesting discussion. A couple of months ago a guy contacted me and offered me 85,000 USD for my website. We currently generate around 6000 unique visitors per day and have around 160,000 pages in google plus all the other search engines.

Our site however has been only around for about 18 months so I told him to contact me again by next year.

My advise! If you don't need the cash don't sell it and develop it further. We have now around 11000 visitors per day with around 20% repeat visitors and our revenues are up due to the fact that we launched Asian content pages with some top serps.

I did sold around 9 websites from 1995 - 2003 but if you have a unique site then sell it to the large guys with the cash in the pockets. Forget all those guys that are scanning the web for some cheap deals and a few month later they sell it off on ebay or some other auction sites.

BTW: I never sold a website below 100,000 USD and if I ever sell my current website it will be a jackpot and I am happy to finally retire from the internet.

Until then I just keep adsense, affiliates commission every month and can happy survice on it.

9:36 am on Apr 17, 2004 (gmt 0)

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anxvariety,
don't contact potential buyers because they believe you need the cash. You get more if they contact you.
4:38 pm on May 12, 2004 (gmt 0)

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anxvariety, did you ever sell that site of yours and how did it all work out if so?
 

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