How Do You Properly Value a Website?

I think its something like its yearly revenue multiplied by 6 (6 being months) but im not too sure what the exact calculation is.

But, as always - it's only worth what someone wants to pay I guess.

Given its making $15,000 per year, expect to pay out a fair amount though..

Edit - Just found the formula, most people selling sites at places like Flippa, sell established sites such as this, for 10-12 times the monthly revenue

so $15,000 / 12 = $1,250 (per month)

$1,250 x 10 =$12,500
$1,250 x 12 = $15,000

This formula does not seem correct though, as if I had a site making $15,000 per year, I'd want to sell it for more than $15,000

Maybe it should be 10 x the yearly value, which in this case would be a whopping $125,000

here :
http://www.warriorforum.com/main-int...-flippers.html

It seems the average going rate currently is around 10 to 12 X's the monthly revenue, not profit.

Now that's for a simple average site, it seems an established and authoritative site can get 2 or 3 times that amount.

So it's really up to the seller.

Source - Been researching this info for awhile now since I've been interested in selling one of my sites.

cheers!

It's generally anywhere from 8 to 12 times the monthly income, not the net profit. However, everything is negotiable.

Also bear in mind this is a very general and generic forumula and does NOT take into account the value of other potential assets that the business might have. For example, a trade mark, a patent, products and/or services, buyer's lists (yes, some people will sell their website but not their buyer's list), celebrity or other well-known person or expert associated with the business, etc.

I once had a website that was only making 8,000 per year, but it had a one word domain name (.com) and the buyer wanted it really bad. The domain name was worth a ton more than what the actual site was making. I knew it. The company knew it and they knew that I knew it, so we came to a number (after months of haggling) that made us both happy.

Ultimately, it boils down to revenue (income), expenses, place in the market (if applicable), list size, value per subscriber, intellectual property, financial stability (how long has the site been earning), JV partners, how many affiliates (if any), etc. and what one is willing to pay for the site.

RoD

15 times net earnings is average but I wouldn't pay anything over 12 times net earnings anything under that is gravy. Also need to consider how volatile the earnings are things like that. Hope that helps.

How is it being monetized?


adsense?
banner ads?
selling via autoresponder?
membership?
ecommerce?
digital or physical products?
lead generation for local businesses?


...

I would have to say 6 to 10 months of the monthly revenue for "normal" sites; I know that this might sound a bit low, but with Google making changes every two minutes, your traffic could take a serious hit anytime (providing this is where the traffic comes from).

Authority sites, sites on great domains, etc. obviously have much higher value.

I usually pay about 10 to 12 months revenue. I will start my bid at 8 months because you just never know. I would never pay over 12 months though no matter what.

12-18 X monthly net profit.

It all depends on the monthly revue and if the it's going up or down.

If it's consistent and if I was interested I would go in at 510k. I can make my money back within a year with low risk.

It is more valuable than regular websites that are sold on flippa at 6-12 month revenue because:

- Is it established business
- Has revenue and traffic proof for 3(6) years

Such website could be sold for $30-50k if it has well designed, has a lot of useful information and is easy to maintain.

It would be relatively hard to find the right buyer for such website who would understand the real value of the website but it can be done.