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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 Iīm sure the site will increase itīs earnings as is becoming very popular on itīs area, so Iīm not sure on what to do! How much to ask, to sell or not to sell?
I would believe you guys more about valuing sites if you didn't make your living from buying sites.
I'm sorry that the reality doesn't coincide with what you believe sites should sell for.
6-10 months (of past "NET" profit) is what websites do sell for. But expectations vary widely and I've had one webmaster ask me for in excess of 1000x (10 years) and he dragged out Yahoo's P/E to support his case that he was doing me a good deal!
Ah - so it's not just me then! I seem to have a talent for finding these people. I've had people point out that Lastminute.com has just sold for x hundred million, and so they're looking for something similar. And owners of small sites say that they WERE thinking of selling to one of the world's big media groups, but since I was interested too they might consider selling to me if I made a suitable offer.
This sort of thing just puts me off - I don't even bother to negotiate. After all, if you're thinking of offering < 2 years profit - and they want 100 years profit - that's not a gap that's going to be bridged in any negotiation.
So how do you all find these people who want to sell for sensible money - do you just have to kiss a LOT of frogs?
So how do you all find these people who want to sell for sensible money
There are many publishers who ask unrealistic amounts for web sites. Someone I know was actively trying to sell her site for $10K+ but didn't have any stats to prove any income.
But then many buyers are unrealistic as well. Not too long ago someone offered me $300 for a page rank 6 site in a competitive area, which is just plain silly.
Being selected against by an algo shift is very unsettling to buyers.
I keep a database of sold sites. These are all sales that I have independently been able to confirm. My sales are not in this grouping.
Average site sale = 9.48 months of income
There is a site in the mix that sold for 440 x monthly income. That is the highest that I have. The overwhelming majority are in the 1.5 to 7 month range. Most of these sites are Adsense or other ad driven sites.
These are just the facts. I wish it were different as I sell far more sites than I buy. If you don't want to sell your site for 12 months income - just don't sell. But, getting back to the original post... an Adsense site is currently selling for 10 months income. Give or take.
Note: ECom sites can often be purchased for next to nothing as almost any half-wit developer can set up a eCom site nowadays. If the product is hard to come by you can sell for more. If you make your own product and have other dealers/sale venues you can start eyeballing B&M prices.
EFV's site is a good example. It wasn't long ago that he had some problems with traffic dropping off. That is a discrepancy that would have to be explained to a buyer. And let's be blunt - there is no good way to explain it. It was not something he could control or predict and therefore is an unknown disaster just waiting to happen again.
Actually, it wasn't a disaster, and it lasted only two months (on a site that has been around at its current domain for more than 3-1/2 years). So yes, it's the sort of thing that might make a buyer nervous, but not as nervous as a buyer might be when evaluating a site that depends almost entirely on search for traffic.
I say that fairly objectively since I'm not looking for a buyer. :-)
BTW, this does bring up an interesting point: namely, whether a buyer would be interested in a "content site" mainly for its content or for its current traffic and income. Depends on the site and the buyer, I guess. Also, when purchasing a content site, the buyer should also think about the cost of maintenance (and who's going to perform that maintenance). Some content is completely evergreen (e.g., the collected works of Shakespeare), but a lot of "evergreen" content does need updating from time to time.
Now, I agree to some extend that a plain web site should go for 10-12 times monthly profit. That makes sense to me. After all, there are too many risks attached to running a web site (e.g. the aforementioned drop in rankings).
But what if there are other assets attached to it, i.e. not just the web site itself but also, let's say, physical photographs (high-quality slides) and the rights to them? That sure would change the value of the site, right? For example, a publisher would not only get the traffic but could also develop further sites using the material that comes with the acquired site.
Any thoughts on the value of such sites?
In some cases, some very, very rare cases a site may have the kind of offline assets that have never been used for the business and are not necessary for it. The seller is, I believe, in a very poor position when it comes to pricing these for inclusion with a business. My advice would be to sell non-essential assets and inflate the company's bank account prior to selling the business so the buyer can see cash rather that assets.
(Yes in a proper business/company that cash is given to the buyer)
I'd just like to find good CONTENT sites that are full of static articles with no fancy-shmancy stuff. They wouldn't need to prove a penny of income to me, and that isn't part of the formula I'm looking for.
Mining for gold... but none to be found. :-(
The best way to get a good content website is to stop being scared of writing and just write it. I have 2 writing degrees so it's easy for me. However, I still don't understand why people are so afraid of writing. It's almost like a worldwide paranoia syndrome. It's like they've made themselves believe "I can't do it."
Well, after many years of writing over 1,200 articles (among my other less glamarous professions), here's a quick and dirty list of what I do for each article:
1. Find at least 7-10 online sources.(I'm more critical of these sources unless I know they are written by experts).
2. Find at least 5 offline sources. (books, journal articles, trade magazines, etc.)
3. Find 1 or 2 experts, call them up and interview them. (Experts are so easy to find if you know where to look).
Then put it all together with a catchy lead (1 sentence), short paragraphs (no more then 3 sentences each), bullet points (when it's best to do so), use A LOT OF QUOTES, and don't be afraid to rewrite it 3 or 4 times cuz you'll never get it right the first time.
I swear that besides online newspapers, I am the only content writer on the web using quotes in his articles. I never see anyone using quotes like I do. I love putting quotes in my articles. Saves me from writing and gives the article some "meat."
Also, if you are going to use previously published sources/quotes in your article, then annotate it.(1) Don't try to reword it and make it look like your own. Just stick the biblio at the end. Gives more credibility and doesn't take away from your article or "expertise" at all. Adds to it. "It shows you did your homework and aren't just publishing floo floo content in order to generate Adsense clickthroughs," explained Dr. Motown, journalism professor with Boogie Univeristy.
Three years ago when I joined WebmasterWorld (under a different name) I used to hang out in the content forum all the time. Then I just stopped because everyone there is like almost everyone else on WebmasterWorld when it comes to content. They want the cheap and easy, half-assed content that is just some rehash of what someone else wrote of what someone else wrote of what someone else wrote. They don't wany any real help, they just want short-cuts. They want to push a button and spit out a 300 keyword rich article.
To back up the method to my madness: I've had press releases published from the Washington Post to the San Diego Trib to blurbs in PC Magazine.
I'm not trying to brag, but I just don't understand what the big deal is when it comes to writing content. One can almost take a systematic approach to how to write each article, regardless of their word skills or talent. I've got it down to a science which is easy to replicate each time.
Like I said earlier in this thread, I sold a content site for $16,500 around Feb. 1. Was making $60/day and of that, $47 was AS. Now, from Feb. 1 to July 1, I rebuilt an old domain I had (same field) with much better articles and it's now making about $43/day from just AS. I'm almost back to where I started in other words and the new site doesn't have the high SERPs the other one did = past tense. (The new owner built links to fast and put himself in a sandbox. He really messed up big. I had it in the top 10 for 4 years and he blew it in 5 months.)
I just finished another site, 26 really strong content pages that were at least 600 words long each, lots of sources and experts in each article, etc., it took me about all of May to write it, and now it's making $10/day. And this is a young website.
I see newbies coming to this forum all the time wanting to "know how it's done" they want the secrets and the sauce to how to make it. When I type in the word "Adsense" in Google and I see the same type people that sold the "No Money Down" real estate seminars are selling get rich adsense secrets.
Hell, there's no secret to it at all.
My secret is simple and free: write the best content in your niche that is out there and write lots of it. Take a systematic approach to each article and just do it. It's all about quality, quality, quality in the content.
IF you do that, the money will follow.
But quality content requires too much work and not a day goes by that someone here or in the content forum wants to know the short cuts and half-ass way to doing it.
How do you explain to these people that they will actually have to work hard and focus on quality? You can't because they'll never get it. Cynical viewpoint, but grounded in reality and experience.
Further reading: Here's a list of 10 tips I gave back in 2002 under the username radiosky
I rarely give writing advice anymore so this is my once a year post on this subject.
I'm not sure if this post was somewhat directed toward me because I posted just before you... ;-)
Just FYI, I *do* write. I write alot!
But I also keep on the look-out for well-written sites that have potential for income. Nothing is more distressing to me than to find out about a site where the webmaster had no clue as to the value of his/her site when they felt a need to "retire". Then suddenly the domain has expired and a scraper has grabbed it. To me it is a tragedy when this happens.
The only sites I've been able to "rescue" belonged to friends who just happened to contact me days before the domains expired because they didn't have the cash to even renew the domain!
Maybe I'll start a site where retiring authors can look for matches with appropriate folks to take over sites for them, maintaining intent and integrity.
Maybe at some point I'll be financially independent enough to be able to really take the time to write in-depth, "knock their socks off" kind of articles. For now and the immediate future, I suspect I'm like most of us and work my tail off to fill up sites with pages that will draw in traffic and impart some good basic info. I would never write a page full of nonsense just to get traffic, but I have to find a balance between the desire to help my visitors and the need to put food on the table.
So your post was excellent Freedom! At some point all of us should follow that advice. But a lot of us don't have the luxury of time and have to lean toward the "quantity" side of the equation when push comes to shove.
current domain for more than 3-1/2 years
.... virgin ....
I thought you were one of the grandpas of the web like me with a 7 yo site
Parts of the site date back to early 1996, and much of it was hosted by About.com from early 1997 until late 2001.
(IMHO, this just goes to show the value of evergreen content. Not that there's anything new about the concept of evergreen content--some of today's most respected guidebooks, such as the Blue Guides, contain material that was written a century ago.)
I just found a site for sale with (literally) *crap* for content. It was written by a backward hillbilly type... and nothing on it even has any relevance to the domain name! LOL
The catch is this. The site has been around since 2003 and is PR3. Only 4 inbound links, but it is indexed by Yahoo, MSN, Google, etc.
She claims to get around 500 natural visitors per month. Sounds about right.
I'd have to "gut" the site... I'd only be buying the domain name in reality.
What can I pay for this site? I'd place relevant content and AdSense. It is a niche I've been considering anyway. I know it would display decent paying ads... well, at least in the 15 to 20 cents a click range.
PROS: It isn't in the sandbox
It is already decently indexed
It gets some traffic... and is PR3 already
CONS: Are there any?
then use your adwords account to precisely guess the potential "adsense-value" of the site in question. Or use the same tool on other sites with the same niche.
If it seems good and you liked the domain name, and of course the price is reasonable, go ahead and buy it. BTW, PR3 is nothing.
Also, for those of you who say most domains or websites sell for no more than 12 mos income, I do not think that is so. Many sell for 3 to 5 yrs income and the recent 160 million $ Marchek deal involved 8 yrs income. I value many domains/websites and its traffic at even more than 8 yrs income.
Many sell for 3 to 5 yrs income and the recent 160 million $ Marchek deal involved 8 yrs income
But, hey, maybe you're right. Put your site up for 96 x (in months) and see if it sells. That's the only way to really, really tell. If it sells come back and let us know us. Till then I'll go by the multiples I see day in and day out.
Back to the original post:
How could you calculate how much is a website worth based on the potential of ppc advert and aff programs? .... only a few high quality incoming links.
Perhaps I could cash the next 3 years at this level on one sale? .... Iīm sure the site will increase itīs earnings as is becoming very popular on itīs area,
Base it on potential and you'll find it very, very difficult to sell. Base it on 36 x and it's almost impossible you'll find a buyer. Only a few links, only Adsense income? As a buyer I'd run now. I don't case what you believe it will make. If you think it has so much potential ... keep the site! Sorry if that's not what you wanted to hear but it's the truth.
For everyone of those very public, million dollar deals there are 1,000s of everyday average websites that are being bought/sold for 6 to 12 months income that you never hear about.
Ebay is not going to come along and buy "your" mesothelioma-debt-consolidation-buy-viagra-online-hotel-reservation.com website for 8 times annual income.If you want to value your site at 8x annual income, go ahead, but you'll never sell it for that price.
Many in this thread have real experience at buying and selling websites and are trying to explain how the market is. They are not making this information up. They, along with me, and everyone else, would love to sell a site for 5 years annual income but it just doesn't happen that way in the normal world of webmastering.
I was lucky to sell my $60/day site for $16,500 and trust me, that sale did not make it in the news.
Let me end by saying that IMO, the only reason people start these threads on WebmasterWorld (which pop up at LEAST once a week) is because they are fishing to sell their websites here to someone else. If they have to do something like that to generate interest in their site, there is not a market to justify 3-8x annual income for it.
Generally I think a site which gets most of its visitors through search engines is worth less than a site which gets lots of organic traffic. A search engine update can cut the revenue with 75% or more.
I don't think a site is worth more than 12 months of current revenue, unless there is a lot of chance on future growth.
But personally I wouldn't sell a site for just 6-12 months income. I would rather keep it.
Buying a link on a PR7 site for one PR update cycle < $300.
The site also has hundreds of one way links, 10,000 visitors a day and makes more than the offer price in a single month. I don't think anyone could duplicate a site like that and achieve the same rankings by creating similar content and buying a single PR7 link, especially in a competitive area.
and makes more than the offer price in a single month
Now why didn't you say that at the start? You thought the PR was important but left out the part that is most important to the buyer. That's the problem with most webmasters selling sites. ;)
Now, elaborate a bit on what it makes, deduct the expenses and a notional salary for the webmaster, and tell the buyer what the net profit is. Businessmen, like accountants, get excited about the right terminology. ;) "Makes more money" is a lot less precise than "net profit" :)
I don't think anyone could duplicate a site like that and achieve the same rankings by creating similar content and buying a single PR7 link, especially in a competitive area.
Now why didn't you say that at the start? You thought the PR was important but left out the part that is most important to the buyer. That's the problem with most webmasters selling sites.
You cannot logically say what is most important to "the" buyer or all buyers, only what is important to you and what you think may be important to other buyers based on your personal experience.
I didn't mention every attribute of my site because it isn't actually up for sale.
I'm aware of sites that were niche directories or have had nice content with nice rankings but no income that have sold for thousands of dollars. So by your criteria these sites would be worth nothing, but obviously not all buyers share your evaluation criteria or these site would not have sold.
Don't be too sure.
I would not know how to start a new site on a new domain in a competitive area, buy a few links and get it ranked easily, especially in Google. If you know how to do this then more power to you. But most of the new sites I see get out of the sandbox and rank in very competitive areas usually have at least hundreds, if not thousands, of links.
On re-reading the above it looks like I'm haranguing Jane Doe. Sorry, that wasn't the intention, I've sent you a sticky.
No offense taken. However I'd still never sell you any of my sites, as I don't think you would value then at what they are worth to me. :)
At any point in the past since I've had web sites, if I'd sold them for only one years income I would have lost a great deal of money.
As for the 302 hijack as a reason sites drop, there are some good comments by stuntdubl and PatrickDeese in the "combating scrapers" thread in the supporters forum on the logic in that theory.
I'm aware of sites that were niche directories or have had nice content with nice rankings but no income that have sold for thousands of dollars
Technically speaking it's not the past earnings but the future earnings - please see the DCF discussed before - that interest most buyers. Past earnings are used as a guide to estimate future revenue. But yes, there is definitely a small sector of buyers who'll be willing to calculate potential future profits even without the benefit of three years worth of audited accounts. There may be an even smaller % of buyers who are not interested in the profit or profit potential and are buying the site as a pure hobby. If they are indeed looking to invest money and time for no monetary reward they may be as difficult to find as the sites YesMom is looking for: large content sites with very little upkeep.
As you've figured I don't buy for the fun of protecting, hosting, filing DMCAs, coping with SPAM, updating, moderating etc.; I do look for the site to give me something back. And if your sites don't then I certainly wouldn't be the right buyer ;)