How much to offer for a site?

Discussion in 'Finance and Traffic' started by Shin Ryoku, Oct 29, 2018.

  1. Shin Ryoku

    Shin Ryoku Fan

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    There is a site in my niche that I'd like to make an offer to buy with the intent of merging it with one of my sites.

    They currently have 60k threads, 800k posts, 7k members

    At any given time, they have about 30 members online and about 300 guests online.

    I've always admired their community, but their activity levels seem to be in decline in recent years.

    How much should I offer?
     
  2. southernlady

    southernlady Coder/Designer

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    If I were looking, I might offer about 1/3 to 1/2 of what you are actually willing to pay for it.
     
  3. Shin Ryoku

    Shin Ryoku Fan

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    They told me what they are asking, and it is about 10x what I am willing to pay, so it doesn't look like there is any chance of a sale.
     
  4. we_are_borg

    we_are_borg Administrator

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    What was normal was 5x the yearly reveneu of the site.
     
  5. Dan18

    Dan18 Fan

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    Monthly revenue average x 12 months.
     
  6. Anton Chigurh

    Anton Chigurh Ultimate Badass

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    The site, any site - is worth exactly what they're able to get for it. Not what they're asking, not what you alone would pay, not any formula based on revenue or traffic...... What they GET. And they might get nothing, in which case the site is worth exactly that.

    Not a riddle. And speaking from experience here, having recently sold two of my sites for tons more money than I ever would have made if they had been monetized. Revenue from the sales equaled well over 10x the investment including the years of hosting costs, the original platform licenses, annual domain renewal costs, custom coding here and there, and so on.

    Your site is worth what you get at sale. Nothing more, nothing less.
     
  7. Joeychgo

    Joeychgo TAZ Administrator

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    Do they have revenue? If so, I would use that as my starting point. I would also look at the decline of the site and factor that in.

    Naturally, I wouldn't make an offer but ask them for their price. No reason to offer $20,000 when they'll take $5000
     
  8. LeadCrow

    LeadCrow Apocalypse Admin

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    You offer what you want. They were just fishing, feeling how much they could possibly get - possibly out of belief acquisition prices are still high and regret of not having sold before.

    A lot of sites are undermonetized for various reasons, and could be acquired for very little as long as the past involvement and expenses of webmasters are respected. You shouldnt evaluate a bid based mainly on how they could've been monetized as independant restored websites, but how much value they would add to your existing strategies.

    No more than 12.000$ tops.
    The market's down and I've seen a couple forums 10 times bigger go for barely 20k. I doubt even forum networks would pay much more than that.
    Also, check their upkeep cost. Sometimes webmasters sell just to get rid of dead weight theyre incurring a loss over, and will gladly exit as long as all responsibilities are transfered to a new buyer.
     
  9. Destroy Repeat

    Destroy Repeat DestroyRepeat.com

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    I bought a forum for $600, from similar board stats. I did a similar thing recently with another site I just bought. In both situations I waited until **** hit the fan. So, if this guy is trying to get you to buy it at 12k. My advice? Wait. Pay attention, but patiently wait until he is truly interested in selling, only then - he will stop thinking of giving you outrageous prices.

    And DO NOT, under any circumstance tell this person you want to merge this into your pre-existing site until you are at least in deep talks, or bought it.

    90% of the time causes exodus or panic. Your job after acquisition is pure PR.
     
  10. Shin Ryoku

    Shin Ryoku Fan

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    Thanks, all. They wanted more than I was willing to pay. Worth a try!

    I've decided to go in the other direction and sell one of my sites that I was going to merge with this one.
     
  11. LeadCrow

    LeadCrow Apocalypse Admin

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    What was their justification for their high asking price? Were they even making any money from the site?
     
  12. Shin Ryoku

    Shin Ryoku Fan

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    Yes, they claimed to be making a good revenue, higher than I thought they would be making, and wanted 4-5X that yearly revenue. I can see that they are on the decline and don't think I would make my money back, so I passed.
     
  13. we_are_borg

    we_are_borg Administrator

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    Well they can claim anything but prove is in the pudding. 4 to 5 times is normal in take overs but then the income needs to show a increasing line if it goes down its not worth it.
     
  14. LeadCrow

    LeadCrow Apocalypse Admin

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    ...how are they?
    And do note that if theyre using some methods of crowdfunding like Patreon, users' pledges woulnt transfer to a new owner.
     
  15. Shin Ryoku

    Shin Ryoku Fan

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    They seem to have legit sponsors that would transfer, but I don't know if those sponsors would stay on long enough for me to make my money back. It seems doubtful.
     
  16. Destroy Repeat

    Destroy Repeat DestroyRepeat.com

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    Next time, when you're thinking of selling your site. Be mindful of who you deal with, because sometimes that site doesn't grow after acquisition. I've seen sites get shut down and die off a slow death. This is why I never sell my sites. I don't want anything I touch go to waste or go down in toilets. Not on my watch.
     
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  17. terrymason

    terrymason Enthusiast

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    I used to get a couple of requests a month to buy my site (not really anymore). I always hated it when someone would ask my purchase price, then ask for all my financial information, and follow it up by telling me why my site isn't worth what I think it is. I'd understand if I had posted the site forsale, but it always left a bad taste in my mouth when it came from an unsolicited offer. I'm not a fan of telling my competition how my business works and what it makes.

    These days I've taken to just making offers for forums in the first email. - Hey, I like your forum alot, I have the same interests, how about I give you $500 for it.
     
  18. Destroy Repeat

    Destroy Repeat DestroyRepeat.com

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    I'll start with bolded - 90% of the time, this strategy doesn't really work. Sometimes, owners have a change of heart and decide to turn around and say "I wand X amount, now." This why I approach website owners with the question: "I'm interested in buying this site. How much would it take to take it off your hands?" Because it's an open ended conversation, it also leads to the owner telling me exactly what they want from the acquisition. Rather than going about the acquisition with saying "I like your forum, I am interested in tthis niche. How about I give you $500?" 50% of the time, the owner shuts down, never reply, and never opens up about the price. The other 50% is mostly people who have no idea how much their forum costs, so they inflate the price. I wanted to buy a gaming forum, but the owner wanted more than what I think it's worth. In this instance, it's an ego issue, especially when they're knee deep in some on-going financial issues.

    It doesn't matter what your competitors know about your site. The information is readily available elsewhere, or you can just make guesses, which is what I do 90% of the time. That's how you do business. That's how you avoid disappointments, etc.
     
    Last edited: Nov 12, 2018
  19. terrymason

    terrymason Enthusiast

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    I'm not a fan of time wasters, and I don't want to waste my time either. If I think your forum is worth $500 then I'll offer you that in the initial email, and maybe you'll take it, maybe you won't. I've been successful with this about 10% of the time (as you mentioned). If I don't hear back from them, then they wanted $5000 for their $500 forum.

    That's how I avoid disappointments.
     
  20. Destroy Repeat

    Destroy Repeat DestroyRepeat.com

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    *sighs and shakes head* I am not a fan of time wasters, too... But I'd rather have a open-ended conversation, than an e-mail that will never come. So, I'll just agree to disagree.
     
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