Considering selling $60,000 / year adult software biz - how to value and market it?
 

After many years in this industry, I'm considering moving on. Our main product, some adult site related software, brings in between $55k and $65k, with one long time employee making $30K currently handling customer support and such. That leaves a profit of about $30K per year.

I'd appreciate any ideas on a) how you might figure out what that's worth, and b) how to find a buyer. Here's one rough way of estimating the value, how else would you do it:?

To make $30K / year in the stock market, you'd have to invest about $250,000, so a $30K / year return would be worth $250K IF there wasn't any work involved. There is some work involved, though, even though the employee handles most of it. So let's cut that $250K figure in half. That leaves $125K as a rough first estimate of the value of the business.

Your thoughts?

I can also be reached at adultsitesoftware@gmail.com .

$125,000? I doubt it.

In the online world things can change so fast and we are seeing that now over the past 2 years. Most people/webmasters/companies look at monthly income and base a sale on that, rarely do people look at yearly because "years" are too long for looking at an online business.

Being as you sell software and do not rely on affiliate sales to programs that might be gone tomorrow you might get more than a year for it, might.

Best place to try and sell it is Flippa.com I would think.

I think comparison to "the stock market" is too general. Find out what the multiple of earnings ratio is for sites like yours. $30,000 times "?"

In good economic times where there is a lot of growth potential, 10x earnings is not uncommon. In a mature market with a lot of stability you might see 3-5 times assuming the market is not flooded with similar sellers.

In a shit economy with a volatile product (which is probably where you are), 1 times earnings might be more realistic. But there are lots of factors.