Some Advice For Site Sellers!!!

As i have noticed on this forum and all over the web, you are selling your sites for to little money. Say a house is worth one million dollars and is rented out for 3 months and makes 3 thousand dollars. Do the home owners then sell the house for 3 thousand dollars, no way. And there is no excuse at there is still things to do to fix it up because even with houses people work tirelessly on renovating it.

Even i am a culprit selling my site for $100 when i got it quoted to sell around the $380 mark.

So to all site sellers of the DP forum and the web, please reconsider the importance of such an investment that a site is.

 

I sometime's wonder, how ideots like you get here. Thats a no brainer, the reason people will sell is cuase the need of money and lack of time.... Which also goes to supply/demand.. Some one has the url/website some one needs money urgently boom.. Gr8 deals on both sides. think b4 you post thank you

 

A site is not a home, it's X number of work hours. Your whole logic is twisted.

 

@ Prodigy, before you call someone an idiot, learn how to spell the word.

 

A site is worth what someone will pay for it. Simple enough. Logic dictates that I can sell my cell phone site, which does on average $240/month, at $2400. I can also add another markup of say $100-$200 on it as well as it being "desirable" and in a great market. Will someone pay $2,500 for it? Well, let's ask ourselves this..

1) Is DP the best place to sell a medium income sized site?
2) Are we short changing ourselves by just offering it for sale here, as opposed to other places?

DP has become slightly watered down over the past couple of years of people coming in and expecting sites for $40-$50. MANY of these sites for sale are crap. Simple templated sites with non-unique content. Sure, it's a great way to start building a portfolio, but these sites, when offered along other sites that are asking for thousands more, are obviously worth a whole lot less, just on appearances and traffic alone.

Value your sites by considering:

Traffic
PR
Income derived over a period of time for ALL sources (adsense, ypn, aff)
Market Dominance
Unique Templating
and definately, give the prospective buyer a REASON to buy.

Those are my 2 cents.

 

don't get into economics i have a degree and one also in applied finance. The thing is web sites are constantly undervalued. Who are you to tell me to think before i post? yeh im not thinking when im typing in the post. My brain sends down movements to my fingers to type. Moron

 

I have a site that made 3 thousand dollars and is worth 1 million, do you want it????

 

If a house is worth a million dollars and you rent it out for $1000/month that renter is getting a SWELL deal. In my neighborhood a $100,000 house would rent for over $1000/month.

Most introductory finance courses would show you that in order to value something, you would want to discount future cash flows (profits) to the present time. To do this we typically assume that the site will not grow without our input. So the future cash flows are either the same as current, or are slightly decreasing. There is a component of the valuation for risk which in sites is typically pretty high. You cannot tell with as much certainty if the site has a solid base or not from the screenshots and doing the research so the risk is typically viewed as quite large. (In comparison to government bonds..)

I do agree with you that the market is currently undervalued, and that is why you will see me more often on the buy side than the sell side. But the relatively new state of this market kind of plays into this.

Note: You may or may not agree with my views on the buy/sell side, I am just trying to present some *intelligent* conversation to the thread rather than name calling.

 

So far no one is offering seminars on how to get rich buying and fixing up websites, but I am sure the time will come. Most sellers obviously don't understand, or don't care, that 12 times monthly net earnings is a 100% reurn on investment

 

it is interested time and money. some dont have time same need money so much or their sites are so bad!

 

Offline business' sell for 6 times yearly earnings. I am with you.

 

i am with you, sites should be more, they are definately undervalued

 

There are also a lot of site been paid too much A lot of junk sites too (not pointing to someone).

I think he posted this because he is selling a couple of his sites ;-)

 

As a buyer of not just sites but offline businesses as well, here's my 2 cents;

1) Something like real estate or a business in a truly mature industry is a lot less risky than investing in internet websites. The rate of change that people have to deal with on the internet is dizzying. If I invest in real estate I have records of values and comparable sales going back 100 years. I know what I am getting into. With a website, one hiccup from Google, an honest mistake by someone and a great online business can cease to be that way fast.

2) In actual deals that go through in the real world, 6 times annual earnings, or even 2-3 times annual earnings almost never happen, even though business brokers advertise them that way, because that's how they try to make their fees. In 2006 there was an excellent survey of over 3000 deals by INC magazine with companies of all kinds, making a chart of earnings related by industry related by "multiple" or what the company actually sold for in relation to its annual income.

Established, pretty darn stable businesses like bowling alleys, hair salons, advertising agencies and the like commonly sell for something like 1 times annual earnings, and hardly anything actually sells for more than 2 times earnings. So in a lot of industries, if your business does 2 million a year it will probably sell for 2 million, but if you can double your revenue, you can sell your now 4 million a year grossing business for 4 million. And it can be more depending on if the industry is hot, or if you are the dominant player in a fragmented industry, etc. Public companies are valued and sold in an entirely different way which is based on a lot of things like income but also heavily on a companies market capitalization, which is the number of shares issued times the average value of those shares. So sometimes public companies can go for big multiples above what they are actually earning.

But anyway, my real 2 cents is that the markets themselves sort out the price based on risk, reward, and what buyers and sellers will agree to. Noboby is getting ripped off in a truly free market like this.

 

I have to agree with tasari.. the fact is that what you said is 100% and i agree with alot of other people in this topic too


xb4b1x

 

yes there are you just need to look.

and

the guy who posted this thread doesn't know anything about what hes talking about. Sites sell for what they are valued at by traffic , revenue earned , domain , pages , content , design , etc. If someone values theyre own work at a certain price then thats what that person feels its worth.

everyone knows theyre own work. so if you feel your sites are worth more than what your asking for then go over to sitepoint and other web master forums and see if they sell. Don't come in here telling us what to do. i'm sure alot of people here are fine with the way they buy and sell sites.

keep in mind that every webmaster has his or her own techniques on building a site. from what i've seen your sites aren't really worth much so thats probably whats pissing you off. if you don't get the money you want then you might want to work harder at it.

edit: and this silly thread doesn't even belong in this section.

 

That's exactly what makes markets so interesting. I think it is really hard, especially for novices, to envision the other parties circumstances. If you have to pay the rent tomorrow, long term value isn't terribly important. If you are good at technical stuff, maintaining and promoting a website may not seem like a big deal. It all depends.

 

I'm skipping to the bottom of the thread to make a simple statement. Anything, a coin, a house, a car, a website, anything is only worth as much as the buyer is willing to pay.

 

Websites constantly are going up and down in value and people have different reasons for buying and selling so yes they are a lot like realestate!

 

it depends.. 95% of sites on DP arent really worth more than few times the monthly revenue. why? there are too many of them out there or too many users looking to sell theirs for cheaper..

however when you get into a REAL business like website, they can sell for 100, 1000 times more than what they make because of potential. look at youtube and myspace for examples.