A site makes $5,500 annually, you sell it for $_____?

38 replies
Any ideas? Ball park figure? I know that's not much for a whole year but that's with minimal traffic, any idea on how much it could be flipped for?
#500 #annually #makes #sell #site
  • Profile picture of the author Lance K
    $5,500 net profit?
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  • Profile picture of the author InternetM39482
    Work involved? Is $5,500 net profit? Is the income graph going up/down, or stagnant?
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  • Profile picture of the author whaldorf
    A good rule of thumb is to take the monthly total and multiply it by about 10 (10 months worth of income).
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  • Profile picture of the author kemdev
    If you're talking $5,500 profit, you could probably get by selling it for
    around $4,000 on the high end. Around $2,800 on the lower end.

    A lot of it will depend on how much work it takes for your site to make
    that amount of money each year. Basically, less work equals more
    money... for you, I mean.

    Hope this helps!
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  • Profile picture of the author Erik Ortega
    If you don't need to sell it, why sell it?

    The way I see it is domains are like real estate and right now the economy is shot so people aren't as eager to bid high on your domain because they don't really see the potential profits for the future.

    Think about it, a few years ago people would splurge on sites because they knew that the sales would increase with the economy.
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  • Profile picture of the author Andy Fletcher
    Ten months is pretty "standard" for low input (in terms of both time and money) sites.

    Examples - if it generates $5,500 a month but requires 40 hours work a week you'll get a lot less than if it's 4 hours work a week.

    If it generates $5,500 a month and requires $5,000 worth of advertising you'll get a lot less for it than if it requires $500 worth of advertising (even if the net income is the same).
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    • Profile picture of the author AP
      All the answers given so far are Incorrect.

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      IM'ers have very little financial acumen.

      First thing any Buyer would look at is how reliable is your traffic source.

      Anyone buying your site will Always think they can do better than you at managing that site.

      Think of it this way. If the Income from that site is Passive income, meaning there is almost NO work to get those returns, then the site is worth a LOT more than $4,000.

      From an Investors point of view, if they wanted to earn $5,000 in interest income on an annual basis, they would have to Invest almost $300,000 in a bank CD earning todays highest rate of 1.74%.

      In my opinion (Former financial planner and Registered Investment Advisor) that site is worth a Multiple of $5,000.

      Most of the advice on this site is from people who have NO clue what they speak of. Always view the source.

      I can tell you in the Offline world many businesses sell for between 1.5 to 3x earnings. I personally would not sell that site for less than about $20,000.

      Show me any investment where I can get those type of returns.

      Of course there are many variables I don't know about your site, so my assumptions may be off.

      Remember this, IM'ers are not business people. They do not understand the Velocity of Money and how it works.

      You would be an idiot to sell that site for less than $15,000 if you have steady traffic and have not taken it to it's full potential.

      I've seriously thought about buying sites from people who have no idea what they are doing. I have a friend who makes Millions from WF members, DP members, and others site like Flippa, Sedo, etc... buying sites from guys like you. He buys their sites, reworks them and sells them for Many multiples more than he sold them for in less than 3 months.

      I love how all these gurus keep telling you 10 months of income is the general rule, yeah right!

      Hope this helps.
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      • Profile picture of the author Lance K
        Originally Posted by AP View Post


        I love how all these gurus keep telling you 10 months of income is the general rule, yeah right!
        I've always thought the same thing. But that seems to be the accepted norm. And I learned a long time ago not to waste my energy swimming against the current. I'll buy profitable sites (businesses) all day long at 10 times earnings but would never think about selling for that.

        However, I disagree with your comment about IMers not understanding how money works. A lot of people don't (and others do) understand money. It's not limited to IMers. And to paint all IMers (or anybody for that matter) with the same brush regardless of the topic isn't something I can get on board with.
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      • Profile picture of the author Lance K
        Originally Posted by AP View Post

        I can tell you in the Offline world many businesses sell for between 1.5 to 3x earnings. I personally would not sell that site for less than about $20,000.
        Many private companies sell for even more than that (I wouldn't sell for less than 8x unless it was a necessary emergency sale). And public companies usually fetch even more.
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        • Profile picture of the author Andy Money
          Originally Posted by Lance K View Post

          Many private companies sell for even more than that (I wouldn't sell for less than 8x unless it was a necessary emergency sale). And public companies usually fetch even more.
          So, judging by the info provided in this thread (as much as it varies)--it might be possible to sell for up to $20k? The interesting thing is this was the number that entered my head when I first thought about selling the business. It's in a non-IM niche, as a brand/following, pretty well established, has huge potential. If I decide on flipping it I'll definitely report back with earnings.
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        • Profile picture of the author AP
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      • Profile picture of the author John Romaine
        Originally Posted by AP View Post

        Remember this, IM'ers are not business people. They do not understand the Velocity of Money and how it works.
        Dude I agree with most of what you said, but this is treading on egg shells.
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      • Profile picture of the author Mr. Enthusiastic
        Originally Posted by AP View Post

        All the answers given so far are Incorrect.

        IM'ers have very little financial acumen.
        And the $4,000 buyer may be one heck of a sharp cookie who realizes the true value of the site.

        But there is another possibility. The buyers could also lack the financial acumen to realize that the site is worth more than $4,000. They might be totally sincere when they say they don't understand how it could be worth more than that.

        You gave some information that might help to educate an ignorant buyer. My question is, where might a site seller find a savvy buyer who realizes that the negotiations should start around $20,000?

        Chris

        P.S. Thanks for sharing your financial perspective.
        P.P.S. When you say 1.5x earnings are you talking EBITDA or some other measure?
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        • Profile picture of the author AP
          Originally Posted by Mr. Enthusiastic View Post

          And the $4,000 buyer may be one heck of a sharp cookie who realizes the true value of the site.

          But there is another possibility. The buyers could also lack the financial acumen to realize that the site is worth more than $4,000. They might be totally sincere when they say they don't understand how it could be worth more than that.

          You gave some information that might help to educate an ignorant buyer. My question is, where might a site seller find a savvy buyer who realizes that the negotiations should start around $20,000?

          Chris

          P.S. Thanks for sharing your financial perspective.
          P.P.S. When you say 1.5x earnings are you talking EBITDA or some other measure?
          That's very simple. You could show him other ways to drive traffic. Make the sales page better. Offer more products or bundle services. Do better followup with prospects and buyers via email, newsletters, etc... Simply state that YOU haven't had the time or energy to do that.

          Yes, I was talking EBITDA.

          Several months ago a friend of mine bought a site from WF member for $4,000. He worked it for 2 months and flipped it for $30,000.
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          • Profile picture of the author derekwong28
            Originally Posted by AP View Post

            Several months ago a friend of mine bought a site from WF member for $4,000. He worked it for 2 months and flipped it for $30,000.
            But that does not necessarily mean that the seller was short changed. Your friend would not have been willing to pay $30,000 for it.

            The OP asked for a ballpark figure and I thought the average expected figure of around $4000 was very reasonable based on known past transactions of sites like this. That is without knowing anything more about the site.

            A huge site like v7n.com only went for around 0.5M with a known monthly revenue of $50,000. Both buyer and seller are very experienced internet business owners and both were happy about the deal.
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      • Profile picture of the author CliveG
        Originally Posted by AP View Post

        ...

        Remember this, IM'ers are not business people. They do not understand ....
        This is a gross generalization that I find insulting to Warriors. I for one am a business person and hold financial qualifications. While some of what you have said is true, some of it is not.

        The question by the OP is a very difficult one to answer; the real answer is that the website is worth what someone is willing to pay having done due diligence.
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  • Profile picture of the author Marhelper
    3,000 - 5,000 depending on SOURCE of traffic. PPC and article marketing not as good as ranking in SERPS.
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  • Profile picture of the author sbucciarel
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    Around $4,500 high end. There are other factors that can affect the pricing, such as is the site labor intensive, the economy, traffic, etc.
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  • It's worth what the buyer will pay. And buyers are interested in how much profit they can turn over time. Clearly you can not assign a value based on what something has done in the past without looking at what can happen in the future.
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  • Profile picture of the author YanKirby
    I would want to consider a lot of things:

    1.) Site's Age
    2.) Source of traffic
    3.) Work involved to reach that monthly income

    Those are the three things I would look at. Hope that helps.
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  • Profile picture of the author MR.MOE
    Put it on site point and see what happens
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  • Profile picture of the author rondo
    How old is the site? This would be another factor in determining a price.
    ie, it would be difficult to sell a one year old site for 2 or 3x annual earnings.

    Andrew
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  • Profile picture of the author simmonsmike7
    Don't forget that YouTube, Facebook, and Twitter make virtually no profits and were valued at billions of dollars, and even sold at that! Sometimes its perceived value, not revenue...
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  • Profile picture of the author Zeus66
    Originally Posted by Andrew Maule View Post

    Any ideas? Ball park figure? I know that's not much for a whole year but that's with minimal traffic, any idea on how much it could be flipped for?
    I recently sold a site making about $4,000/year for $3,000. It depends on where you sell it, a bit of luck, and how much proof you can provide. The source of income matters too. The easier (more passive) the better, in my experience.
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  • Profile picture of the author Phil Ayres
    I think it greatly depends on your source of traffic and how you monetize the site. For example, if you are talking about organic (and Google can take it away) you will (and should) get much less than if you have an established stream of traffic and an established monetization model.
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    • Profile picture of the author GeorgR.
      Originally Posted by Phil Ayres View Post

      I think it greatly depends on your source of traffic and how you monetize the site. For example, if you are talking about organic (and Google can take it away) you will (and should) get much less than if you have an established stream of traffic and an established monetization model.
      uh...wow..i just wanted to ask a question and you now totally say the opposite of what i was thinking.

      You say that organic traffic is less valuable since it "can be taken away". I know what you're saying but i am confused now.

      Example:

      I have one site where could prove i make about $2000/month with this site from article marketing. The site also has some backlinks and SEO efforts made, however majority of traffic comes from article directories and only very little from true organic.

      Now..you guys are saying i COULD charge $20.000 for this site (rough ballpark figure) - even if the traffic is coming from actively doing article marketing? If the new owner wouldn't continue with articles, the traffic would very likely soon come to an halt since the site's organics are rather "meh".

      So how would you sell such a site?
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      • Profile picture of the author MRomeo09
        So let me get this straight AP, you have this long resume of experience which for some reason you feel you have every right to spout out in this thread. Questionable honestly. And you've "thought about buying websites", and "have a friend who makes millions doing this"?

        I don't know bud, you kick off my BS sensors. Thinking about buying websites and knowing people who buy them are completely different things than actually BUYING WEBSITES.

        The truth is it's hard to say what websites are worth, and anyone that argues otherwise is fooling themselves. So much depends on the type of website, the work involved, the traffic incoming, the trustworthiness of the seller, how much can be verified etc.

        I've seen forums with no appreciable income stream sell for 100x the income coming in. I've also seen websites with $500/mo net profit sell for $2k. However there are so many scams involved it really does bring down the prices. Most websites don't have good paperwork. And if you have so much experience in business, you should know that's a major problem in valuation. When you can't really verify much it affects the price downward. I wouldn't pay for a "business/website" that makes $10k a year anywhere near $30-40k unless I have some very solid proof, income tax records etc. And that brings up another problem most people selling websites have more than one, and the revenue and numbers get all mixed up with other sites, etc. It's hard to completely analyze traffic patterns, etc.

        If you've ever sold an offline business, they'll tell you the quality of your books is almost one of the largest selling factors. And the quality of books in website sales is atrocious as a rule.

        So the major reason websites don't sell for 2-10x earnings is because of the shoddy papertrail and the fact that much of it is unable to be verified completely. You're not usually buying a solid completely verified business, you're taking a calculated gamble/risk. And THAT's why websites often sell for a year or less of earnings, not that IM'ers are idiots.

        Just my opinion,

        M
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  • Profile picture of the author John Romaine
    Ive sold dozens of sites over the last few years and I have never heard of anyone selling at just 10 months worth of revenue.

    Ive always sold at LEAST 2 - 3 years worth of income.

    So if you have a site that makes $5,000 a year, its worth at the very least $10,000, especially if its entirely passive income.

    Without knowing more about the finer details, you should be selling at 2 to 3 years worth of generated income.
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  • Profile picture of the author charto911
    Not only your work you put in to earn that but what are your fixed costs what would it cost to upgrade change etc... are equally important to a buyer
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  • Profile picture of the author derekwong28
    What you feel that your site is worth is often very different to what it will sell for. The 10x monthly revenue is not set in stone but is the usual quoted reference point. Certainly, this is consistent with what is being achieved in Flippa and DP. Rememeber this is the average and so the range can be between anything from 4 months to years. I have personally bought a number of sites with no revenue and so in my case, it would be infinite.

    I think one of the biggest reasons why the selling price is so low is because there is a lot of seller fraud around. With an offline business, you could easily ask for the books and examine them carefully by yourself and professional advisors before you buy it. You just can't do this with small websites. My own figures were that at least 20-25% of the sites I bought were scams. Therefore, I believe that legitimate site sellers are paying a premium for fraud committed by other sellers. Moroever, I had several sites that performed quite well in the beginning but whose traffic suddenly collapsed when Google changed its algorithm.

    Buying sites is definitely a very good investment. But I have stopped recently because of all the hassle involved and likelihood of fraud.

    Derek
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    • Profile picture of the author countonuspr
      I have been the middle man for two rather large recent website transactions and I have noticed that it really truly depends on the niche your site is in, the possibility for growth in that market, your revenues, and most importantly who is looking to buy your site.

      On the deals I was involved with one site was doing $450,000 in revenues (not profit) and it sold for $780,000 which is more than just the 10 months revenue or 1 year income.

      The other deal I was a middle man for was doing over $400,000 in revenues, but it sold for $240,000 which is obviously less than 10 months revenue or the 1 year income.

      As I sold these sites for my clients I learned a lot because I discovered how different people look at websites for sale. On the larger deal above I had people tell me they would pay $250,000 or less for it and others thought that was even too high.

      The buyer that did purchase the larger deal has gone onto nearly double revenues in the first 2 years after purchasing it. So he saw value in the deal.

      My point for saying all of this is that truly it depends a ton on who looks at your deal. Somebody may think it is worth $2,000 and another person may feel it is worth $9,000. The goal when selling your site is to look over your offers and choose the best offer that you feel comfortable with.

      To start your listing at least go for 1 times and see what offers you get. If you can help it don't put a price on it, or make your price higher. In the big deal above the original price was nearly $1,000,000. The seller got a price he was happy with and the buyer got a great deal. So start higher initially if you have to post a price because you may be surprised what you end up with.

      Hope this helps!
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  • Profile picture of the author zerofill
    Depending on what the site is it can be a range of prices.

    I expect 12 months profit...if I am going to sell something...at a min...

    However depending on what it is and if it is in an upward trend right now...you can sell for as much as 24 months income at times.

    Plus if the site is unique or is a web application with a lot of work in it...things change again...Especially if it is something they can make money by duplicating on multiple sites...

    Too many variables go into determining the value to give an appropriate answer without the facts of what the site really is.
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  • Profile picture of the author JamesM
    I know this might sound obvious, but value will also depend on the niche that the site targets. If it's a transient niche then value will be a lot lower than if it has long term appeal.

    Another thing to consider is how you're monetizing it. If income is from an affiliate scheme, then are there other aff schemes that could be applied should the current setup go south?
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    • Profile picture of the author butters
      This is why I don't see the point in selling sites unless its going earn you some good good money. 5k goes so quick so why not do this.

      Invest that 5k - buy content, BL's, social book marking, forum posts etc... re invest it and make a it a 10k site, if it can make 5k then it can sure as hell do a lot more then that.
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  • Profile picture of the author molsted
    Hi guys.

    Interesting thread. What if you have a network of sites, consisting of both a couple of wordpress blogs, a few small static sites, and a bunch of free hosted sites like, wordpress.com, blogspot, quizilla etc etc all in the same niche optimized for the same keywords more or less that generates the same amount of money (apr 5000/annually) with more or less no-work involved (all SEO traffic from Bing, Yahoo and some Google)??

    That'd be interesting for me to know ;-)

    I've been looking to sell, but figured noone is willing to pay what I'd charge...

    It's been steady income for years, but I am just too tired of keeping track of all the different sites - allthough it IS easy money.

    Best
    Martin
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  • Profile picture of the author Akky
    It should easily go for $4k...

    G'day,
    Akky
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  • Profile picture of the author JoeHughes
    Hi, on the whole I agree with AP. But it all comes down to where and how you get your traffic. If your traffic is from search engine's I will give you more than $4,000 right now.

    I bought one site for $800 that was making $6.25 a month! But within two months it was bringing in just under $2,000 a month. I now only spend about 3 hours a week on the site and regularly bring in $500 - $700 a week.

    Now the guy who sold me it probably thought I was a mug. But I knew because he had free traffic, no sign up page and no affiliate offers I could monetize it quickly.

    So it depends where you get the traffic and the opportunity that the buyer believes exists.
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  • Profile picture of the author Sandeep Shah
    Unless you are in need of money and need to cash out, don't sell it. You cannot grow the money faster than your website's value.
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