Hi, Hope this is okay to post here? I own a 50% share of a web site. I developed the web site and did ongoing work/maintence on it. The agreement i had with the company was that if the site did well they would buy it from me at somepoint in the future. That time has now come. I would like to say i only own 50% of the value of the web site and not the whole business. So ... how do i value the web site? At the moment we get maybe 5-10% of business in from free search engine traffic ... and the rest is from PPC (google and yahoo) How do i value this website? what is it worth? I have access to all figure like monthly ppc spend, monthly sales, profits etc ... any suggestions? Its a pretty competitive market that the web site is in also. It appears on page 1 of google for many terms but not them biggest terms .... Is there a formular i can use to work out its value? Thanks
so if we have $200 coming in and $100 going out the leaves me with $100 50% of $100 = $50 Thats based on 1 day? So a month will be $1500 A year will be $18000 How long do i go on for? What about the value of a domain that is about 5 years old. pr4
Here is the list of URLs that you may find useful to assess the worthiness of a website, although they may differ widely in their valuations. Any way, they are worth a try! www.dnscoop.com http://www.PRCashRank.com http://www.websitevaluecalculator.com http://directory.sootle.com/website-worth http://www.smartpagerank.com http://www.priceasite.com
Most do not care care about the age or the PR of a site. It means nothing. Now, your partner may think it matters, and he may not be as savvy in this regard, so you may be able to get more money. There are, God knows how many sites out there with a pr of 8, and years old, and they STILL don't do that much in traffic. On a consistent basis, how much is coming in versus how much is going out is the bottom line. How long do you go on for? Isn't that up to you? If you think you can get the example, "$18,000" out of him, and you want to get out now, go for it.
so when i work out 50% profit of the site ... how long do i base that on? 1 day 1 month 1 year past 3 years?
However long it's been that you have had a 50% share. If it's been 3 years, then 3 years. If it's been 5 years, then 5 years. But shouldn't you be discussing this with him??? Anyway, good luck with it.
well he has asked me what it would cost to buy me out now? as i said the site is about 5 year old now ... so i guess if he has made $50,000 a year i should ask for ... $25,000 x 5 = $125,000? I thought there was a unoffical rule that you valued a web site on the previous 3 years profit?
Have you checked out http://www.smartpagerank.com/ - it attempts to give a value to websites. Granted, there are a lot of factors that it wouldn't be able to consider, but it's not a terribly bad attempt. It's worth the look anyway.
It's easy. A site worths the LAST 10 months of NET revenue. Not 10 times the last months. It's the last 10 months of NET revenue. Now, there are some site worthing less. For example: Proxies are about last 3 months of NET revenue...
ok so the last 9 months has made $10 for each month and the 10th month made $150 so 9x10 = $90 + $150 =$240 when you say net revenue does this mean i do NOT take away the ppc spend? so i simply work out how much the site has made in the past 10 months and thats my valuation regardless of advertising spend etc?
I could be wrong, but I think you are making this way too complicated, darrens. First, nail him down by asking him if he thinks that it is fair to say if the both of you have been at it 50/50 for five years. If he says yes, well, then, yes, I think it is fair that he gives you 50% of all profits made for the past five years, and, of course, figuring out how much you both put in time and money wise towards advertising. You should ask for this. Have that figure or a rough estimate of a figure ready, right there on the spot after he says "yes." If it is ify, or he has incomplete records of profits made, then you should consider making it easy on yourself and do it at, say, 3 years. "Ok, I'll acccept just 3 year's worth of profits made to make it easy on both of us so we don't have to nickel and dime it all through the past five years." There wasn't much profit in that first year anyway, right? May I ask what the url is???
NET = Gross ($240) - any expenses to make these $240 if any = Fair market Value A site doing $10/month with no expense is better than a site doing 2 millions dollars/month...if you spend 3 millions/month to make them...
In addition to above list, you can see the worth of your website with the help of technorati and also seodigger.com
thanks guys ... i have more of an idea now. I think the reason he wants to buy me out is so he can sell the whole company. remember i only own 50% of the web site and not the company. the owner is being fair and as i have known him for so long i dont want to rip him off. If anything i think he wants to see what i value the site at to help him in any future sale. Think i will use 'Codythebest' method ... thanks again - good job