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  1. #1
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    A legit company wants to buy one of my affiliate sites, they just want the domain name but the site is making money - I would like to sell but how do I come up with a price? Is there a standard formula?

  2. #2
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    There really is no standard formula... I sold one of my affiliate sites last year for $1600.00, $500 for the domain + 12 months of affiliate income based on the last months check.

    I had ~10 hrs of "work" as well as ~ $50 for domain registration and hosting...

  3. #3
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    Depends on how much the site is making in profit. They'll also want to know the traffic, revenue and expenses.

    I'd hire a good accountant and maybe a lawyer.

    Q-pon Central
    Coupons and deals since 1998
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  4. #4
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    Not sure exactly how much it's making.. maybe $750 a month profit

  5. #5
    ABW Adviser Panel Dynamoo's Avatar
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    The figure of a site being worth twelve months income is very common, plus some extra if its a really good domain name.

    So basically, the site is worth $9000 to you a year, so that should be your minimum price.

    ________
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  6. #6
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    The domain name is ok, has a hot google listing

  7. #7
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    I would imagine that if the site is making $750 a month now that it has likely increased monthly revenue over the last year. Ask yourself where the monthly income will be at this time next year based on your current growth. If you put a little extra effort into the site (maybe some Pay Per Click advertising or other ads) - could you drive up your monthly income even further? As you probably know -sometimes those $750 a month income domains all of a sudden can become $1250 monthly producers when the search engine gods look good upon you as well. That can occur.It sounds like you have a good category specific domain as well as companies usually don't seek to buy crappy names.

    I also have heard that a site's years income is the way to value a site. However - personally I would be seeking in the 1.5 to 4x yearly income range. I also realize that there are many more advertising venues out there that can produce a good ROI that I haven't tried yet for my sites.

    Are you really sure you want to sell it? It sounds like a great revenue stream that will produce income far longer than only 1 year down the road for you.

    Larry Wentz
    www.AffiliateNetwork.org
    www.MultipleDomainHosting.net

  8. #8
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    I don't want to sell, but I'd be happy to swap it for one of these. I'll ask for an over-the-top price and see what they say.

  9. #9
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    Can you share the URL? perhaps if we get a look at it, we can guage a little better it's worth.

    Q-pon Central
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    http://www.qponcentral.com

  10. #10
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    hehe, no thanks

  11. #11
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    waste of time.........

  12. #12
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    Do they have rights to the name?

    ----
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    Merchants: Do you realize that some of your affiliates are being paid commission on sales which you have paid for via PPC, offline advertising, and your targeted mailings?

  13. #13
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    no, they don't have any rights
    wentzco, what you say makes sense, it could probably make $1k+ with some redesign

  14. #14
    ABW Adviser Panel Dynamoo's Avatar
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    OK, here's another question.. how long has it taken you to get the site to where it is? Or how long would it take you to get a site that would make that much income?

    So, if the site took two years to get from zero to a potential 1K per month, then you're selling at a loss if you sell for less than 24K. It could be that the domain would be worth easily in excess of 30K-40K.

    Now, this might be too much for them to pay.. so another option might be to rent the domain for a specified period.

    ________
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  15. #15
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    Dynamoo
    It's taken me 6 months to get the site where it is now. I could probably build another in a couple of weeks, that would be a bit cheeky
    I'm going to sleep on it and come up with a price tomorrow.. they'll probably say they changed their mind tomorrow of course.

  16. #16
    Full Member drumminlogan's Avatar
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    <BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR>Originally posted by spacewar:
    I don't want to sell, but I'd be happy to swap it for one of http://www.honda.co.uk/new_cars/imag..._6_5_front.jpg. I'll ask for an over-the-top price and see what they say.<HR></BLOCKQUOTE>

    Wow, that is one ugly car.

    Logan Thompson
    The Best Christian Affiliate Programs

  17. #17
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    yeah, I haven't seen them in the US, lots of C-RV's but no H-RV's, maybe it's too small for you guys, and only a 1.6

  18. #18
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    My real job is a stock analyst and I have previously valued privately-held businesses, so this is one subject that I actually know something about.

    From your perspective, the site is worth a discounted value of future expected net profits (cash flow). Depending on how long your site and the affliate companies have been in business, you can forecast expected profits into some point in the future. Off of the cuff, I would forecast 2-3 years out based on past sales trends and then discount that number by some type of risk rate (yield of 10-year treasury plus an additional percentage for risk). Discount rates are really nothing more than educated guesses, but a disount in the range of 15-25 percent probably isn't unreasonable.

    Just about any financial calculator and excel can do the math for you. It's called "Present Value".

    This is good for an off the cuff figure. Depending on how much we're talking in terms of $$, it may be worth hiring an business valuator. You can check American Society of Apraisers (ASA) for somebody in your area, or I can recommend my old firm (just shoot me an email - the address is in my profile). As a ballpark figure, I wouldn't pursue this route unless your looking at $5k or more.

    Hope this helps.

    NetSweat.com - The Internet's Fitness Resource
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  19. #19
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    Oh one other thing. There may be some metric based on site traffic. I haven't seen one, but it doesn't mean that such a metric doesn't exist.

    If you have a university with a library system near you, you might look for a book or database that lists valuations applied to sales of other Internet sites. There are books and databases on this subject, but I can't think of any names right now.

    NetSweat.com - The Internet's Fitness Resource
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  20. #20
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    If they don't want the site--just the name, then you can simply point a new domain name to your current design, change a few logos and start fresh--voila, you still have the site, and can build your traffic again.

    Who knows, you might even be able to talk them into url forwarding your traffic for a few months, or at least putting a site moved message up during the transition.

    You are probably looking at three months downtime.

  21. #21
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    netsweatcom, is this it?

    PV(25%/24,24,1000,0,1)

  22. #22
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    Looks about right, though the discount rate should be divided by 12 and not 24. It's an annualized discount rate.

    See if you can get them come up with a number first and there use the above calc to determine if it's a fair value. Unless its a high offer, I would get them to justify the number. Even if the number is a fair price, you can always try to neogiate a little extra for goodwill (the intangible value of simply having the domain active for a while).

    NetSweat.com - The Internet's Fitness Resource
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  23. #23
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    I dont think the usual offline valuation methods apply online that too for affiliate sites...

    If the site depends only on SE traffic then i will say the site is not worth more than past 6 months earnings...if it has a brand awarness and a lot of bookmark and typein traffic then it maybe worth like 2-3 times the last 6 months earnings

    "The Future belongs to those who believe in the beauty of their Dreams."

  24. #24
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    Actually it directly corresponds, because it boils down to the amount of cash generated by the business in the future. This can be quantified and then discounted to a present value. The key is developing a reasonable and defensible forecast and applying a correct discount rate to it.

    NetSweat.com - The Internet's Fitness Resource
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  25. #25
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    Gopi said much more elegantly than I, exactly what I've been thinking. Though I'm not sure its worth even that.

    If the site has no branding 80+%(?) SE traffic.. you should take what you can get now.

    ----
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    Merchants: Do you realize that some of your affiliates are being paid commission on sales which you have paid for via PPC, offline advertising, and your targeted mailings?

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