Someone wants to buy my site, how can I value it?

#1

Post by anonymous42 » Thu, Nov 06, 2008, 12:54 PM UTC

In the interest of anonymity I would prefer not to reveal my real username.

I have a site that does about a 150,000 pageviews and 5,000 uniques a day. It is profitable, making about $50,000 a year, not from adverts. The average pageviews per visit is over 30.

At the current growth trend I would expect it to be making over $150,000 in a couple years. It is also an influential site for its niche, market leader in its own right.

It comes top of google for any keywords pertaining to the market it targets.

What do you think is a good price?

Re: Someone wants to buy my site, how can I value it?

#2

Post by smoody » Thu, Nov 06, 2008, 1:19 PM UTC

I can't give you a figure, but I do encourage you to consider not only your current traffic figures, but also potential traffic figures that will result from your site being introduced to the acquirer's user base, if that makes sense in your scenario. If they get 10x more pageviews and uniques a day and they give you a prominent position on their site, your traffic could instantly double.

I guess what I'm saying is that the synergy that comes from an acquisition (or any strategic relationship) can sometimes have a value all its own.

And there's almost always an emotional component to consider that supersedes spreadsheet models. If you enjoy running the site, then it might be worth more to you than if you don't.

Best of luck!

Re: Someone wants to buy my site, how can I value it?

#3

Post by anonymous42 » Thu, Nov 06, 2008, 2:01 PM UTC

smoody wrote: post #2

I can't give you a figure, but I do encourage you to consider not only your current traffic figures, but also potential traffic figures that will result from your site being introduced to the acquirer's user base, if that makes sense in your scenario. If they get 10x more pageviews and uniques a day and they give you a prominent position on their site, your traffic could instantly double. I guess what I'm saying is t…

That emotional attachment exists, I made this from scratch, and watched it grow over time.

Re: Someone wants to buy my site, how can I value it?

#4

Post by steveplace » Thu, Nov 06, 2008, 2:24 PM UTC

Since you do have money coming in and an expectation of what your growth will be, you can run a discounted cash flow model to get a price.

Re: Someone wants to buy my site, how can I value it?

#5

Post by swombat » Thu, Nov 06, 2008, 2:24 PM UTC

Do you want to sell it? If you're passionate about it, which I imagine you are, to get that successful, then perhaps not...

If you don't want to sell it, I would do one of two things:

a) Start with a very high estimate and work your way down from there. Who knows, maybe they'll bite, in which case you can take a long holiday in the middle of this recession.

b) Let them come up with a figure, then ask them for double that. After all, they approached you, so you can apply a bit of pressure.

Re: Someone wants to buy my site, how can I value it?

#6

Post by tortilla » Thu, Nov 06, 2008, 2:25 PM UTC

With any situation, it depends, but great article here:

http://www.wrevenue.com/2007/10/24/selling-a-web-business/

Re: Someone wants to buy my site, how can I value it?

#7

Post by tjic » Thu, Nov 06, 2008, 2:26 PM UTC

anonymous42 wrote: post #3

smoody wrote: post #2

I can't give you a figure, but I do encourage you to consider not only your current traffic figures, but also potential traffic figures that will result from your site being introduced to the acquirer's user base, if that makes sense in your scenario. If they get 10x more pageviews and uniques a day and they give you a prominent position on their site, your traffic could instantly double. I guess what I'm saying is t…

That emotional attachment exists, I made this from scratch, and watched it grow over time.

Irrelevant.

The site is worth whatever it is worth to the acquirer.

Once you figure out that number, you decide if you want to sell it at that price or not.

Until you get to that point, don't bother thinking about the emotional attachment.

Also, if you get a pile of money, you'll go on and do something fun with it (a whole new project?). You'll establish an emotional attachment to that project too.

Re: Someone wants to buy my site, how can I value it?

#8

Post by MoeDrippins » Thu, Nov 06, 2008, 2:30 PM UTC

tjic wrote: post #7

anonymous42 wrote: post #3

Earlier quoted context omitted.

That emotional attachment exists, I made this from scratch, and watched it grow over time.

Irrelevant. The site is worth whatever it is worth to the acquirer. Once you figure out that number, you decide if you want to sell it at that price or not. Until you get to that point, don't bother thinking about the emotional attachment. Also, if you get a pile of money, you'll go on and do something fun with it (a whole new project?). You'll establish an emotional attachment to that project too.

Exactly. It's worth only what someone is willing to pay.

It might be worth more to you, but if it is, you simply don't sell it.

Re: Someone wants to buy my site, how can I value it?

#9

Post by shimon » Thu, Nov 06, 2008, 2:33 PM UTC

You should probably try to get some competitive bids. If you have trustworthy contacts with any of your potential acquirer's competitors, call them and say "hey, I got this offer from FooCorp and I haven't really thought much about selling the site, but it's not a bad offer and I'm wondering if you guys might be interested" and see what they say. Don't expect a binding offer right away, but see if you can get some idea of what a few other potential acquirers might be able to pay, or if they make jokes like "I couldn't acquire a pair of shoes right now."

Consider seriously that this is not a great time for acquisitions. Companies want to reassure investors and lenders that they have a safe amount of operating cash on hand, and any significant expenditures will be scrutinized today in a way that they would not have been a year ago. One guy I know who sold a moderately sized website a year ago at a price that made him quite happy thinks he'd only be able to get one sixth of that price today, if he could find a buyer at all. If you are happy continuing to work on the site for a few years, and your revenue projections are reasonable, you might want to hold on to it and see if things improve.

Re: Someone wants to buy my site, how can I value it?

#10

Post by trickjarrett » Thu, Nov 06, 2008, 2:41 PM UTC

Your website is a business.

While most business brokers are focused in physical assets you should be able to find ones which can evaluate your business and give you a value for it.

If you want to, they can even handle the sale, to protect you and help the sale along. The negative is of course that they take a share of the transaction, and the other buyer may hire his own broker.