What are +4 million pageviews worth these days?

[Simon]

Hiya folks

We have a lot more on our plate than we can take care of right now, so we're thinking about letting go of a couple of sites that we really don't have time to develop further at the moment (and no, not Fetish Club or Cash Fetish).

We've spent years developing sites without ever selling one that we've grown. We've bought and sold some domain names, but we've never sold a developed site that already has some very nice traffic.

Before we get to the point of actually offering them for sale (which I'd announce in the "for sale" forum), I'd like to get some feedback on how people are valuing sites today. I know that some folks base things on traffic, or PR value, or number of inbound links, or SERPs, or percentage of bookmarkers, or a range/combination of other different things.

To keep this a general discussion, let's just say these these are two large free sex story archive sites. They have thousands of pages indexed by search engines, over three-quarters of a million visitors a month, and over 4 million pageviews a month between the two sites.

If you have any experience in putting a value on a web property, I'd be very glad to get some feedback on how I might best go about setting a reasonable/rational value for websites like these.

Thanks in advance for any input you can offer.

Simon


--
Any book worth banning is a book worth reading.

[Toby]

The general rule of thumb that I've seen in a couple of different places is roughly 3 times the average monthly revenue.

[RawAlex]

A ton of page views without income may or may not be worth anything. They might worth something to someone, but it's the cash that counts just as much.

If you are making 5k a month, you would look for anywhere between 10k-25k for the sites, partially based on the domain names and sources of the traffic as well.

Good luck, you should do well.

Alex

[Simon]

Hmm...maybe I'm missing something. Using the example offered, if a site was generating $5K/month in revenue, why would someone sell it for only 2-5x that? I mean, unless they really needed the money in a bad way. If a site was generating $60K annually, why else would someone take $10-25K for it? Are web properties really valued that low these days?

[RawAlex]

Simon, there is no way to be able to say that the income would continue without end. The adult business as a whole could be trashed tomorrow by a loss of processing, obscentity rules, or other outside forces. it is much harder to value an adult web property due to the uncertainty in the business, IMHO. The buyer would be betting the business would continue at least 2 years, and the seller would be betting that it would be not more than the value it was sold for.

Basically, your sites are worth only what someone is willing to risk on them. If they feel they could turn that traffic into MORE money, they might pay you closer to 10 times current revenue, based on what they think that revenue could be.

Are you able to disclose one of the sites?

Alex

[Simon]

Okay, I can see that it might be much like investing in any risky business. I understand about how the whole biz could blow away from the wrong winds. I'm just still trying to get my head around why someone would sell at that multiple unless they were having a fire sale. Seems like in almost all cases, someone would be better off just keeping the site and letting it generate that same amount in a few months.

I have no objection at all to disclosing the site names, but I did want to keep this a more general discussion of "how" developed websites could be valued. I'll drop you a pm in a minute with site urls.

[mpahlca]

That is the standard business multiple 3 to 6 months of income for the property. This is a standard brick and mortar as well as internet property price, based on the fact that income is changeable and that long term revenue is never a gaurantee plus the outlay of cash would need to be re-couped, so the price of 3-6 months would take a year to fully re-coup and make profit on.

[Greenguy]

There's a lot of formulas floating around as far as what a money producing site (or any business) is work. I've heard anywhere from 3 months to 18 months is what the value is.

I suck - I have nothing to offer except vague backless opinions

[Simon]

GG - I do like your range better, at least the high end has some high end in it.


Okay... let me see if we can look at this a little differently.

Lets say you had a couple of free sex story archive sites that you've had online since 1998/99, with lots of pages in the engines, more than 750K visitors a month, and that you showed those visitors more than 4 million pages (stories) each month that they requested. Now let's specify for the sake of this discussion that the sites generate $0 (zero dollars) in directly* trackable revenue of any kind.

Now, based on those criteria...what kind of formula would you use to try to set a value on those sites? Is there a way to compute a site's value based on something besides the revenue it directly generates?

Simon


* explanation to follow so as not to make the question too long.

[Ramster]

Originally Posted by Simon

Okay... let me see if we can look at this a little differently.

Lets say you had a couple of free sex story archive sites that you've had online since 1998/99, with lots of pages in the engines, more than 750K visitors a month, and that you showed those visitors more than 4 million pages (stories) each month that they requested. Now let's specify for the sake of this discussion that the sites generate $0 (zero dollars) in directly* trackable revenue of any kind.

Now, based on those criteria...what kind of formula would you use to try to set a value on those sites? Is there a way to compute a site's value based on something besides the revenue it directly generates?

Simon


* explanation to follow so as not to make the question too long.

I'll give you 2 years income. $0 monthly X 24 months = $0. Quick transfer it to me.

Seriously now. Based on this "online since 1998/99, with lots of pages in the engines, more than 750K visitors a month" I'd be asking for about 9 months income. But since you say there is no income to track one would really need to see the site to see the potential.

With 25K a day in traffic the site has to be worth a lot of money compared to many. Traffic looking for stories and traffic in general can be valuable.

[Xeno]

Here is my view....basically the formula is not fixed for any site really because there are a few variables involved:

1. Traffic amount and type of traffic
2. Revenue site generates
3. Amount of monthly maintenance to the site
4. How much regular management is involved to run it
5. Amount of work put into creating the original site
6. are there memberships
7. How does it rank in search engines w/what keywords
8. and as others mentioned, depends on if there are buyers

The three key parts is: Traffic, Revenue, and if there is buyer interest in it in a specific time period...say, 2 months. If no one has interest for quite awhile, then the price is too high.

I've sold a couple sites in the past myself and if you take everything above in combination this will help establish it's value. Many formulas show up with people. For instance: taking in account the above 8 notes, establish what you would REALLY like to get for it, then what your minimum sell price is, add those together divide by 2 then that is your starting figure. Another as it was mentioned average out 3 months of revenue, etc...

Regardless of what method you use, in the end, its really up to "what a buyer is really willing to pay for the site" ...buyers market. As a buyer though who is being told the price is huge, I would not pay a dime until I saw proof of Search engine stats, web site stats, and of course, something in the banking financial records to show you are making money.

Anyways, good luck with it and don't buy that tropical house yet until you have the $$ in your hands

[Simon]

As mentioned earlier...

I didn't want to tag any direct revenue to these two sites because there just two sites in a large group of "free content archive" sites that are used primarily to attract surfers, convert them into bookmarkers, and eventually interest some small few of them to click links to our own other sites, including paysites. We don't track these (older) sites individually to attribute how much revenue they're eventually responsible for. All we know is that these sites send a good deal of traffic to our other sites.

What we know is how many visitors come to the sites. And we know how many pages they request. We know how long they stay. We know what keywords/phrases brought them there, and/or what site they came from. You know, all the things that basic traffic stats will show you. We just don't know the dollars each one is responsible for.

Yes, our new projects use advanced tracking of all kinds. But we haven't gone back to many hundreds of older projects and updated what might be millions of varied links to use today's tracking codes.

So basically I'm wondering how you value a couple of sites out of a whole bunch that are all lumped together for most other tracking purposes.

[Simon]

NetGoonie ... thanks for the checklist. No worries about the house in the Tropics, I'm already closer than I want to be now.

Ramster ... yes, that was exactly why I was asking for some input here. I knew that we didn't have a critical piece of info if we wanted to use that formula. So I thought I'd come ask if there were some other ways to put a value on them.

Like you said, I know that 25K surfers a day looking for porn/stories is worth something. I'm trying to figure out some way to get at that number with only the traffic figures to work with.

[Wazza]

750K monthly visits or unique visitors?

[Simon]

We only have webalizer stats running on those two sites, and it doesn't give daily uniques, only what it calls "Unique Sites" and those seem to be on a monthly basis. The webalizer stats show approx 60% of the 750K are what it calls Unique Sites, which I believe means completely different IP addresses that showed up that month in the log file. Of course any one dynamic IP address might have been used, for instance by AOL, to allow hundreds of unique users to access the sites every day. But for the sake of discussion, let's say 450K are unique visitors

[Linkster]

Simon - what Ive seen in the last year is a great decline in what people will pay for a revenue producing site - that said, with no numbers to attribute to revenue, it would be more of a buyers liking what they see and offering something that makes you happy as mentioned before.
In the past, I would say that the upper end of what GG mentioned would have been a good formula for a paysite or something that had a good history of revenue (Ive seen it go as high as 24 times the average monthly income) and for free sites like tgps etc, its pretty easy to sell at 12 times the monthly rev.

Please PM me with the sites as I might be interested as well, and would also like to see the webalizer stats if thats possible?

[Simon]

Hiya Linkster ... I'll have a pm off to you in a minute with the urls of the sites. No problem getting a look at the webalizer stats, I just need to copy whatever pages you'd like to see into a non-protected directory for you.

[GonZo]

SImon I dont know about all these high end formulas or worth or etc etc. But if you have a page or pages that are getting 4 million impressions Id be interested in talking to you about doing some advertising...

hit me up in a PM.

[Papa]

Originally Posted by RawAlex

Simon, there is no way to be able to say that the income would continue without end. The adult business as a whole could be trashed tomorrow by a loss of processing, obscentity rules, or other outside forces. it is much harder to value an adult web property due to the uncertainty in the business, IMHO. The buyer would be betting the business would continue at least 2 years, and the seller would be betting that it would be not more than the value it was sold for.

Basically, your sites are worth only what someone is willing to risk on them. If they feel they could turn that traffic into MORE money, they might pay you closer to 10 times current revenue, based on what they think that revenue could be.

Are you able to disclose one of the sites?

Alex

Exactly what i think ! I would never spend lots of cash on a site. NEVER. There is too much stuff going on right now.

[Fonz]

$0.01 per visitor for the next 3 months, google charges $0.05 minimum but you have returning traffic and maybe "less qualitative" than pure SE traffic so 750,000 x 0.01 x 3 = $22,500

But maybe I live in a perfect world

[Simon]

GonZo - I'll shoot you a pm in a minute, but you hit on one of the reasons we're considering letting these two sites go. Both sites have only static html story pages, thousands of them, with mostly hard-coded banners or served via ancient Javascripts. Trying to get someone's advertising onto those pages is not an easy task the way things are set up today. The sites would be a good opportunity for someone who wanted to remake them into what the future of story sites should look like. I have too many other things going on these days to think I'll have time to get these rebuilt how I'd like them, and it takes too much time to update them the way they are now.

Fonz - I'm pretty sure Google has a lot of returning traffic too. I'd be willing to say that this traffic in not more valuable than Google traffic, but I wouldn't concede that it's only worth one-fifth of what their traffic is worth. Sex story surfers are pretty good traffic, as those here who have story sites will know.

[Wazza]

Google = 5c per click not impression

Just thinking about $50/CPM is making my balls swell

[Simon]

Hiya Wazza ...

( that always makes me hear Hiawatha in my head ... sometimes I think Stu is rubbing off on me ::grin:: )

Yeah, I can see the swelling from here. You may want to get those looked at.

I was looking at it from the perspective that those are per clicks, since those are all clicked page requests. I wasn't suggesting that impressions were worth as much as clicks.

[MadMax]

Originally Posted by mpahlca

That is the standard business multiple 3 to 6 months of income for the property.

That varies quite a bit from one industry to another. For example, in manufacturing it's generally around 4x EBIDTA (Earnings Before Interest, Depreciation, Taxes and Amortization).

[Wazza]

Higherthiamin,

Yeah I appreciate that - merely pointing out that using Google Adwords as a guide isn't the best way to go about it as the comparison is using two related, yet fundamentally different things. One of my campaigns has a CTR of ~2% (1 click for every 50 impressions), so if we say the traffic is of the same quality then 0.1 cent is where the multiplication should start.

IMO, like cars, a developed website is always worth more in your hands.

Balls sorted