Site makes $100/month - how do I determine sale price?

I have a website I developed 8 months ago, by hand from scratch. I've not paid for any advertising nor bought any links, I've gone and built each backlink myself. All the content is wholly original and I will sell its rights, along with articles I've written to market the site.

The income is earned solely thru AdSense and while checks have been over $100 every other month, the site's now begun to earn over $100 in consecutive months.

It's a niche site that's an innovative approach to a social cause. I built it to help people. With greater, more consistent promotion the site's traffic will skyrocket and along with that, the earnings.

My question is, knowing that it's now making over $100/month how would I price it? In your responses, please give me an idea of how you came to your conclusion of a value for a site earning this kind of income.

Thank you very much for reading my post!

 

Mathmatically around $1200 for obvious reasons ($100 x 12). But after the site is purchased it's entirely up to the new owner to maintain the unique content and such, correct?

I would say $600-$700 is a fair price.

 

I see where you're coming from and that sounds right to me, the $1200. Obviously, I'm going to lean towards a higher price, but I say that for a reason. This particular site should actually NEVER need to be updated or have new content added. It's certainly able to be expanded but it should serve its purpose and remain profitable without any alterations whatsoever. Just my estimation, of course.

Still, $700 is not terribly shabby! I really appreciate your well-worded opinion, DchozN. Thank you very much for chiming in!

 

there are few factors which will determine the price of your site. (I'm using share valuation model here. )

What is the growth rate of your earnings each month?

How long will the buyer maintain that site?

Price of your site = Average Monthly income / (Your required ROI - Income growth rate)

Average Monthly income = (Monthly income now + Monthly income at the time he will give up the site) / 2

Required ROI = Bank interest rate + your risk allowance

 

Buyer is not judge by revenue alone but there are many factor that will determine your price such as PR/backlink/google indexed pages/link popularity.
The fair price is max 5x of your average monthly earning which is $500

 

i'll take it for $600. Pm me URl if you may.

 

$5,000 I would sell it for. Obviously if it is making you $100 a month someone can come in with there marketing mind and turn it for $1,000 a month. As long as it is unique and someone can market it properly I wouldn't see why you can't get around $5,000 for it.

 

Genearlly when I am trying to put a value on the site or company I do the following:

How much does it bring in per month in profit?

Then look at what kind of money it is thats comming, ads, sales...

Reason for this is sites such as proxys might make $300 a month from ads but a few hours of downtime will lose all your visitors and thats all that money gone, they are what I call High Risk.

Revenue from sales is generally more "safe" if you have an hour or two of downtime people will still look for your site and the chances are if you know how they got the traffic you can do the same, and get the same return if not better.

So for a site thats "safe" get the profit and times by 9-12 months (depends how much you like the site as well, people will pay more for something that they are interested in. And for a "risky" site 2-9 months profit.

Ultimatly a site is worth what someone else is willing to pay for it, you may think its worth £100 but that don't matter if you can't actually make a sale at that price.

 

your site is only 8 month old and u earn 100$ so i hope that u will increase it to 200$ within 2-3 months.

so if i m at your place then......

i never sale site, maintain it and will make more. if i have prob. to market then hire someone to market my site and may be he will take my one month income but income will going up and i m cover my investment

or i have need to sale it in any condiction then i will sale in 1k$s. (this is 10 month income approximate) and i will make another one within this time and my income start again.

hope u like my suggestions.

~jakki~

 

Hey Ambalama, I wanted to offer some more stats to see what you guys after having some more information to work with.

Please keep in mind I've done no paid advertising ever and I only spent a couple weeks promoting the site before other activities required my time. That means after August 2008 I did zero work of ANY kind for the site. No promotion, no updating, nothing at all other than checking traffic every month or two and of course, cashing the checks.

Here's the data I've got for you guys to look over, taken from Analytics and Adsense, please pardon my lack of formatting prowess......

Traffic Stats from July 10, 2008 until April 22, 2009 (according to Analytics) by percentage:

83.65% from Search Engines (primarily Google, Dogpile, Ask and AOL - in that order)
9.52% from referring sites
6.83% from direct traffic


Month Impressions Clicks Earnings

July 10, 2008 - July 31, 2008 4,446 49 $ 7.45
August 1, 2008 - August 31, 2008 11.342 170 $ 17.82
Sept 1, 2008 - Sept 30, 2008 22,358 265 $ 36.60
Oct 1, 2008 - Oct 31, 2008 39,494 331 $ 67.19
Nov 1, 2008 - Nov 30, 2008 37,242 331 $ 80.39
Dec 1, 2008 - Dec 31, 2008 39,361 370 $ 63.12
Jan 1, 2009 - Jan 31, 2009 54,221 310 $ 67.24
Feb 1, 2009 - Feb 28, 2009 73,921 488 $ 114.18
March 1, 2009 - March 31, 2009 101,398 974 $ 152.10
April 1, 2009 - April 22, 2009 62,704 489 $ 94.56

If you have any more questions, please feel free to ask. I want to set my price to where I get back what I deserve because I had next to no money when I opened this thing on little more than a hope that it'd return my investment.

Thanks!!

 

If it requires absolutely no effort, why not just hang on to it and keep collecting the cheques indefinitely?

 

SmallPotatoes, great question! I'm saving to buy an engagement ring for my girlfriend so I'd rather have the money up front because I want to ask her to marry me on her birthday (in June). I could use the site to simply make payments, but at this point in my life I don't feel like waiting around any more

By the way, thanks to everyone for your great comments, questions and insight! I hope I've been clear with my replies. Let me know if there is additional information you could use to better evaluate how I should price a site like this.

 

My two cents: I reckon about $3,000 is a fair price for such a site, based on two to three years of continuing revenue with scope for development.

 

Personally I'd be a bit wary about considering $100 as the monthly earnings as it's only just started earning $100. If it had been consistantly earning $100 for the last 12 months I would definitely offer 2 years worth of income, so $2400.

Having said that, the few that posted stupidly low amounts like 5 or $600 are talking out of their arse, or just trying to pull a fast one. So for me right now it would be worth say about $1200ish as a bit of a gamble, hoping the earnings would continue... but if they are rising I don't know why you would want to sell it, even if you are saving for an 'engagement ring'? Unless you've got a shed load of sites and you can afford to drop one.

 

PM me the site.. I will look and make you an offer if it's something i'm interested in.

 

Thanks for the feedback here, guys, it's really helping!

Astroman: Those are valid points you're making about the income just now hitting $100/month (average). I'm operating off the philosophy that the longer a website stays live the better it tends to rank in the search engines and this particular one hasn't been SEO'd for its primary search terms that currently pull most of its traffic. I'm not exactly an SEO all star I also agree that it could well be a gamble. I started it for next to nothing and gave it a bunch of hours up front, while I could but it's certainly not anything that I bet would succeed like it has. As far as me keeping it while the income rises I actually do have several other sites that are far more inspiring to me so I'd rather give them my time, basically. I don't mind sacrificing this one off.

To those PMing me to ask to see the site so they can make an offer, while I greatly appreciate your interest, I'm still working to get a solid appraisal for my site before I post it up to auction off. I want to make sure I know what I'm doing before I begin taking offers.

Thanks everyone!

 

Revenue and Risk are the sole determinants of value.

PR, links etc all contribute either to earnings or to the risk, they don't have any independent value.

If you really want to know how to value sites read this from the recognised expert in the field.

 

$1000 would be a fair price, IMHO

 

Thanks guys, for speaking up!

Foggy, those links you provided gave me a fantastic idea.. I could conceivably come to some sort legally-binding agreement with a buyer (could be tricky) where I offer my consultations on how to increase the site's earnings, coupled with a profit-based installment plan for payments and therefore raise the sale price!

 

That's exactly what happens in the "real" business world.

There are two off-book ways of increasing your sale price. You can demand a higher price if
1. You finance the sale - allow the buyer to spread payments
2. You take part of the payment for meeting performance-related targets

Be careful with the latter, the extent of control you have over decisions could severely restrict your ability to improve performance. The former, it goes without saying, is worth only what you can get for the collateral.