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  1. #1
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    Need Some Advice
    I have a question for the veterans on ABW. I have a domain which has done decent for me but I've been approached by a company with 6 figure yearly sales that would like to buy the domain from me. How would you value the site? A yearly sales multiple? Is there a website out there that has recent domain sales numbers? Thanks for your help.

  2. #2
    Best New ABW Member 2007 sfcom's Avatar
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    http://www.dnjournal.com/domainsales.htm

    -sfcom

    (sorry, not a veteran of ABW, but this should help anyway)

  3. #3
    Merchant & ABW Ambassador
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    I have never sold a domain before but search on here. I think somebody did sell his/her domain within the last 8 months and posted on ABW..

    You can also guesstimate and factor in other things like opportunity cost, the man hrs cost to future cash flow.

    Why not throw out a high figure that you would like and let them come back to the table with a counter offer. Then work from there.

    p.s. it is not a science but rather a science.

    All the best

  4. #4
    Speechless OTProf's Avatar
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    You could take annual earnings and multiply by 2-6x and then add in additional intrinsics such as name quality, page ranking, etc. Of course, the intrinsics are key w/something like a domain valuation and could bump up the price waaaaaaay beyond any earnings multiple. If you mill around sites like sedo[dot]com you may get a feel for some of the prices out there.

    Good luck!

  5. #5
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    Great advice! Thanks everyone.

  6. #6
    Outsourced Program Manager John Jupp's Avatar
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    First of all they have done the approaching and not you so don't set a price.

    Instead state that you are happy with the domain but if they wish to acquire it would they please make an offer. I've got a couple of domains I was going to let expire. I then decided to do a quick google search for a relevant term to do with corporate or company checks and found I'd been on page 1 for like ages. So now I'm keeping the domain and I might even get round to monetising it. Then if someone wants to buy it becuase they can develop it better or it fits in with their business model, they can make an offer.

    Don't set a price. Let them do that. Then if the price they offer is reasonable let it go. Don't get suckered into committing yourself to a price of your own making.
    Flambi Media Limited - USA/UK/EU Affiliate Management Expertise

  7. #7
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    Last spring, I was approached by a company that wanted to buy a moderately successful web site I owned. After I shared some data about the site, the company made a low ($15,000) offer, which I immediately declined.

    I earned about $1,000 per month from the site, and decided to offer it for sale by auction, with a $25,000 minimum bid.

    After exploring my options, I decided to offer the site for sale through an eBay auction; see my discussion of the auction at http://forum.abestweb.com/showthread.php?t=91338. My auction listing included a lot of specific revenue and traffic information, as well as a very specific analysis of the site plus some charts and graphs (as of this moment, the auction text is still visible on eBay but the charts and graphs no longer appear, and the eBay listing will probably disappear very soon, as eBay does not normally archive old auction listings.

    I expected that the actual sale price would be $25,000 to $35,000, but the actual closing price of the auction was $50,100, which I received a few days later.

    There were three active bidders, plus at least one more who was actively watching but decided not to bid. All of the bidders were companies that I'd directly contacted about the auction; none would have found the auction if I'd just quietly listed it on eBay. Just 10 minutes before the auction ended, the top bid was $26,000 -- the winning bid was posted only 8 seconds before the auction closed.

    As John notes, you should probably let the prospective buyer make an offer, rather than responding to a request for a price that you'd sell the domain for. If the offer is absurdly low, just say no -- don't make a "counter" demand for a specific price. If the price is "in the ballpark" (the right order of magnitude, at least) then you might want to "counter" with a specific price, but if you do so you should expect negotiations to continue.
    Last edited by markwelch; November 29th, 2007 at 06:15 AM.

  8. #8
    Affiliate Manager Howard Gottlieb's Avatar
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    The pricing of web properties is an interesting world. There are so many variables that effect the price:

    1. The domain name: If you have a domain name such as those listed in the article references by Sfcon such as Computer.com there is obvious value in the name alone.

    2. If you have high PR the site has other value from an SEO perspective.

    3. If you have real traffic that has its own value.

    4. If the site operates as a retail or wholesale business you would apply the normal multiples to earnings or cash flow (I have sold 5 businesses and typically look for 7 to 10 years cash flow).

    5. If you have figured out how to monetize your existing traffic then there would be some industry multiple available for valuing that. However with the SE's constantly changing their formulas current monetization is not guaranteed day to day so would be worth less than cash flow from #4.

    Selling a business is an interesting proposal. I would suggest, though, as others have already that you let the pursuer make an offer understanding no one makes a full price first time offer.

    Good luck.
    I would rather live my life as if there is a God and die
    to find out there isn't, than live my life as if there
    isn't and die to find out there is.

  9. #9
    Moderator MichaelColey's Avatar
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    What everyone else has said. Put the ball in their court. If they want the domain bad enough, they might offer you many times more than the domain would be worth to you. If you set the price, you minimize your potential.
    Michael Coley
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    "Education is the most powerful weapon which you can use to change the world." Nelson Mandela

  10. #10
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    Thanks for all the advice everyone. I threw the ball back in their court. We'll see what happens...

  11. #11
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    Hello
    DHolland, curious to know what happened with your domain.

    Thanks.

  12. #12
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    The made a very low offer which was like 20X less than what I thought it was worth. I told them my counter offer and I haven't heard back from them. My domain name is the name of their product so it is a great fit for them and about 60% of the traffic I get is actually looking for their product. According to quantcast I get 3X their website's traffic. For what I'm asking for it - if I were them I'd buy in a heartbeat. But I can't let it go for nothing.

  13. #13
    Speechless OTProf's Avatar
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    You might want to try the ebay approach mentioned above -- esp. if there are multiple companies that would benefit (and hence potentially compete in an auction) from your domain. Again, hope it works out well for you one way or the other!!

  14. #14
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    Thanks DHolland for the reply. I hope you get what you're looking for. Interesting to know the process behind negotiating for a good price.

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