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[i]"your domain name is valued at $10 to $30 per hit per day. If 1,000 people land on your front page each day, your domain could be worth $10,000 to $30,000."[/i]
That is rather funny. I have 12 domains doing that traffic and much more! ;) Using their logic, they are worth $400k-$700k! Any takers? lol
Where do these people come up with these figures?
I'm seeing complete sites (not just the domain name) offered (but going begging) at 3 to 5 times revenue, which is in line with valuation models used to sell small businesses. I believe these are unattractive to potential investors because these sites for sale are often dependent upon affiliate and/or banner income which can dry up overnight.
I believe the movement to PFP adds a new facet to the valuation model. If a site draws and sustains traffic on a keyword, and that keyword is bid at $1 on GoTo, it seems reasonable to value each "search term visitor" to the site at $1. However, I haven't seen this line of reasoning surface anywhere.
What about PROFIT?
What about Proprietary Technology? - That's where the value is.
Hey! Good idea. Note to self....
Actually, savvy site buyers would look for a range of bids and likely be wary of "one trick ponies." That sort of valuation hanky-panky happens in b&m biz sales, restating everything from the building appraisal to cost of inventory... no reason we should expect anything different on the web.
In a related vein, I acquired a site this year, it's only real assets were a one word dotcom domain, existing traffic, and rock-solid listings in Yahoo.
>What about Proprietary Technology? - That's where the value is.
Yes, and I think that's why content, affiliate, and banner-driven sites are still begging. There's little to lock up their revenue stream and guarantee it will continue.