New to the board and i hope you don't thnk this is spam. Just thinking of getting out of the business, we have established sites that generate 400k plus per year in gross rev and this year will do more, tax returns to prove it!....so just wondering if asking 7 times gross rev is in the ballpark. I have had friends that have just sold their sites that are not even close to our rev at incredible prices.
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7 times the gross revenue is insane. Even if you wanted 7 times you NET revenue, it would take someone 7 years before they made a profit. For a brick and morter company with a good reputation and good products, that might fly.... but I'm not so sure with an internet site. Of course it would help to know what site and type of products you're talking about, but I can't imagine anyone jumping at 7 times gross.Originally posted by gpicasso
New to the board and i hope you don't thnk this is spam. Just thinking of getting out of the business, we have established sites that generate 400k plus per year in gross rev and this year will do more, tax returns to prove it!....so just wondering if asking 7 times gross rev is in the ballpark. I have had friends that have just sold their sites that are not even close to our rev at incredible prices. -
I've been online since 1997 and have
been quite successful in the adult industry.
Although I have never sold any of my sites
or been involved with any website sale,
I have considerable experience in selling
retail stores as an owner and as a broker.
My specialty were card shops that grossed
between 250k to a million+ yearly.
I heard numerous times throughout the
years that "dollar for dollar" (gross yearly sales)
was the best case scenario for pricing a store.
Providing the gross profit was 50% or
better, which meant you weren't selling
cigarettes or magazines as that would
prevent your gross profit from reaching
50% since the magazines earned 20%
and cigarettes at the time may have
been a bit less.
In all my years as an owner and broker,
I never knew anyone who actually sold
his/her store for a price that was equal
to it's gross sales.
THE BOTTOM LINE IS, YOU ARE SELLING
AN INCOME!!! AND THE BUY IS PURCHASING
AN INCOME!!!
The most important disconnect in selling
a business is the value the seller places
on the business and the value the
purchaser places on the business.
If you look at the sale of your business
as providing an income for the purchaser,
then determine how much money per year
the new owner would put in his pocket
each year. (his net after gross expenses
for running the site).
Then ask yourself, "How much would you
pay someone to "Earn" the same amount
your website is netting you.
You mentioned that your site is grossing
400K this year. Would you pay 2.8million
to purchase a website earning a gross
of 400k???
It's not likely to happen. You should expect
no more then you would be willing to pay
someone for their site doing the same
numbers as you.
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