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How do you value these sites

by valvarga
7 replies
I have 3 hypothetical situations with similar profits, I wonder how you would go about valuing each. Numbers and domains are not real of course

Here they are:

1, keekreviews.com. This site is an amazon review site. The owner, Mr Keek does all the work on the site, content creation and backlinking too. His only source of traffic is SEO. Since he does all the work himself on the site, he has no monthly outgoings. He spends 20 hours on the site/month. The site generates $1000/month income on average.

2, keekshop.com. This site sells small gardening items via dropshipping, through ebay, amazon and search PPC. The turnaround is $6000/month. He spends $1000 on ppc, pays out $4000 for the products etc. He spends 20 hours on the site/month. He ends up with $1000/month profit on average.

3, keekhost.com This is a small hosting company who sells basic packages for $5/hosting package. Traffic mainly comes from word of mouth and PPC. The owner outsources all maintenance for a fixed monthly fee. She spends 20 hours on the site/month. The site generates $6000/month. He spends $2000 on PPC, $3000 on outsourcing the monthly 24/7 maintenance. He ends up with $1000 in his pocket/month.

So how would you value each of these scenarios?
#sites
  • Profile picture of the author crissie
    20 hours/mont for $1000 clean per month is a great opportunity.
    I can't give you a professional view on value, but I'll be interested to hear from the gurus about pricing.
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  • Profile picture of the author latestnewsheadline
    Banned
    If I don't have money, I choose 1.
    If I have money, I choose all
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  • Profile picture of the author gpwilson
    Would you like to buy or sell those sites?
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    • Profile picture of the author valvarga
      These aren't real sites and aren't real situation. I was just wondering about values, cos to me they all represent different values. The 1st option the SEO guy, well I have heard that usually you get around 10-12 times the monthly income. So in this case say 12K.

      But the other 2 should not be valued the same way, because there is a real business behind the operations.

      hmmmm
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  • Profile picture of the author phil838
    The general rule of thumb is that most sites sell for about 1 year's worth of their monthly profit. So a site that makes $1000 net profit per month will sell for around $12,000.

    If the business is strong and the buyer is reasonably sure he can increase the business's profits over the next year then it's not outrageous to get a sales price closer to 1.5 years worth of revenue.

    But if the business is losing ground the opposite happens, of course.
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  • Profile picture of the author Alessandro Zamboni
    Option number 3 is the most profitable but time consuming. A hosting must be kept up, witha good call center, CPanel and a lot of bandwidth.
    So I will go with option 1 and 2, personally. They require less work, but they gave more satisfaction!

    See you soon,
    Alessandro
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