Rhetorical Question - If a Website earns X what is its Sale Value

[namealot]

What about heroin in Afghanistan? You're starting a debate that potentially needs Great Whites to feed it, not Sticklebacks.

No inference to you intended or implied - I'm just saying this is a huge subject.

None taken pretty sure those involved in the heroin trade in china , Columbia and Afghanistan are all capitalist as well… Don’t think there are any worker cooperatives there lol there money is all laundered through the system … capitalism is unsustainable hence the crashes... I have nothing against a profit but not at the cost to society as a whole...

 

[namestrands]

Nothing is perfect, but the drug dealers back in my day were truly hard working, if they only applied those skills into the corporate world as they would fit right in.

Its all very well saying that its wrong, but unless you can come up with a workable alternative that encourages competition, innovation and such then you have to stand by that capitalism works better than everything else.

 

[GreyWing]

Don't be fooled, everyone in power is captalist, even the Chinese. The idealists that are true socialists are filtered out well before they get anywhere near power.

Trouble is that when people say capitalism doesn't work they point to todays banking crisis as an example. That's wrong, we haven't seen capitalism with the banks. True capitalism would have seen the banks crash and someone buying what's left of them with a £1 coin.

People would have lost their pensions and savings, the point is that next time they would have look at who they had their pension with, what they were investing in and we would have all learned lessons... We have learned nothing at the moment and will make the same mistakes again and again until this ponzi scheme crashes to the floor. Only then will we see capitalism.....

Ironically true capitalism will see the banks fall and the rich lose money with their investments like 1930, the poor have little to lose. So why the people are protesting against capitalism outside St Paul's is beyond me.

 

[aZooZa]

Biggest drug dealers are the Singapore goverment. While secretly backing the Burmese junta, they'll hang you for an ounce.

 

[namestrands]

The inherent vice of capitalism is the unequal sharing of blessings; the inherent virtue of socialism is the equal sharing of miseries. - Sir Winston Churchill

 

[fabpack]

So, ignoring all the political stuff:

All valuation models so far have been based only around income multipliers.

Now, assuming you're selling a site that has a lot of registered members and user generated content - what value does an active user have on top of the income multiple and, what is the last login period that defines an active and inactive user?

Looking forward to some thought provoking replies!

 

[namestrands]

I had not factored social Networking and membership.
Our site Membership is 25,000 Souls

 

[fabpack]

That's quite interesting - is there a reason why you haven't allowed a value for each user?

Looking at the very high value, high profile sales of things like skype (before it was even remotely profitable) the vaue of a registered user seems to be about $40.

 

[brum]

Couple of things you should be able to claim entrepreneur relief upto £10million if it is a business from what u said it seems to be so no tax to pay .... When sold.

Most business are valued at a multiple of revenue/profit however that multiple is dependant on future growth expectations ... Hence why fast growing companies on stock market might sell at 30-100 times where as mature companies might only sell at 5-8 times .


Now if u say that the market is growing fast then u may be better off just holding it for a few years since if market size tripled ....and you kept ur market share and let's say a multiple if 5

Then in two years you would get

1000*5=5000( now )

3000*5=15000( 2years)

But if that was true u would also likely to get a better multiple so instead of 5 maybe 8

3000*8000=24000 in two years .... As you would have a bigger business and they usually have more stability and therefore command bigger multiples .... I have a friend who just buys smaller business joins them into larger ones and sells them and makes lots just on the change in multiples ....

The other method to calc is the membership .... 25000 if it is active the thing to look for here is what is your viral coefficient the bigger it is the faster the site will grow and the more someone is likely to pay .... If the network effects of the site are huge to the users then u could get a lot more by basing valuation on members rather than rev/profit model.

Good luck ... Would love to know what it is pm me if u want promise not to tell anyone .... Honest .... Good luck with it

 

[Edwin]

Couple of things you should be able to claim entrepreneur relief upto £10million if it is a business from what u said it seems to be so no tax to pay .... When sold.

Actually Entrepreneur Relief involves 10% tax, not none. But it's still a better rate than cap gains would be, that's for sure! Worth getting an accountant in on the process early if there's any real prospect of a "nice" sum on the table.

 

[namestrands]

I claimed entrepreneurs relief when I sold Dangerous.com a couple year ago now, as on a few other domains, but really not sure if that can be applied since transferring over to Limited Company.. I have an accountant, I guess I have not seriously actually considered offers as I perceived them to be low.

The thing is I am convinced there is a business model in this which is perhaps what is subconsciously sabotaging negotiations.

On one hand its a good revenue stream, but on the other hand the money could help fund our new life in Germany.

I have a 3 letter .co.uk out on lease for £25k a year I turned down a £100k cash offer on that domain in favour of 4 year lease contract. All which totally surprised me, but I honestly think since becoming a father your business sense changes considerably. I stand by that it was the best decision at the time and the monthly income is better than the lump sum... perhaps I should look at a lease option for the other site.

Thanks for the PMs, sorry could not reply to all but I will be taking up some of those suggestions and of course drop some commission to those who suggested avenues to explore if they pan out. Truly appreciated.

 

[brum]

@Edwin Ur right .... 10%

Being a dad does change everything .... Good luck again

 

[BREWSTERS]

I would be happy with a 4 multiple also, but not happy with the Capital Gains on that. I have been running the site since 2006.. Bought it as a premium domain even back then from BuyDomains.

We are top 2 position for the keywords on every major search engine, and never budged last Panda update. This is a news site, not a crappy content site ;-)

I enjoy working on it despite it taken up a good chunk of my day.. I guess I could sell out for less I have had plenty of firm £150k offers (5 this year) which would normally tell me that this is the market price. However I know and they know what is around the corner so it was a great investment, returning over 2000% over cost so far and one agency today just booked a 6 month... I think even were I to get 250k it would be a reluctant sale at that.

Shall mull it over some more I think.. thanks for all comments.. appreciated and noted.

Sounds like sellers remorse before you've even sold it. Your gut is telling you 250k is too cheap.