Preparing a Site for Sale
If you are growing a site organically it might be worth it to sacrifice the short term earnings for long-term growth, but what happens when it comes time to sell a site? If you site has a strong brand or other intangible brand type assets worth far more than current earnings consider those before making any changes, and do not tarnish the site's image. If you site does not have those, and will likely sell at an auction it will probably sell for some multiple of current earnings, based on a number of factors including
- how much work it is to keep the site earning what it is (fixed costs, in time and money)
- general category growth (upside potential)
- site position in the category (upside potential)
- how aggressively it is monetized (upside potential)
Almost everything that has the word potential in it is going to be heavily discounted. Some people will not see the potential, while others will feel that they don't want to bid based on potential (because they feel that is their value add after they buy the site). Before you sell a site, make sure you spend a few months tweaking the monetization to max out your current revenue numbers. That is the base which most buy offers will be built from.
Comments
What places do you buy /sell sites at? I've checked out digital point (low prices great place to buy, but most of the available sites are low quality), site point, general auctions like ebay, a bunch of other "site for sale" setups.
Thanks for that, Aaron. As someone who recently attempted (and failed) at the site sale part, I know you're dead on.
Solomon, I have a list of places you can reference:
http://www.petertdavis.net/199-where-to-buy-a-website/
Hey Peter, thanks for the list. I've socially bookmarked it for further reference.
A. Brazell, what do you think was the cause of the failure?
>>>some multiple of current earnings
Aaron, you aware of anyone with hard core or researched documentation on site valuations?
Sorry Rae
I am not. The biggest thing I know of where there are lots of public records is for high value domain name sales, but those are usually for premium names or larger businesses.
One could also search past forum sales at various forums to get an idea of the value of different related smaller domain deals.
Peter
I might suggest you add earners forum to your list, wonderful site:
http://www.earnersforum.com
Personally, I find my best sites at SitePoint, and my best deals at digitalpoint forums. With buying, you just have to be patient and do your research.
If I were selling a site, I would go to one of those two as well, SitePoint if it were a big site with good traffic or income, and Digitalpoint otherwise.
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