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How Much Would you Sell your Blog For?

Posted By Darren Rowse 15th of May 2005 Other Income Streams 0 Comments

Yesterday I reported that Bloglogic was up for sale – today I’m wondering how one would determine the worth or asking price of a blog (or network of them).

How much would you sell your blog for? How would you determine it’s selling price?

A few months ago I was offered $13,000 for Digital Photography Blog – I almost laughed when I got the email. If someone had offered me that much a year or so back I’d have jumped at it – but now I know it’ll make me that in a month or two just from its Adsense earnings. But it did make me wonder what I’d be willing to sell it for.

Last September I wrote about how I suspected Blog Farming (fattening blogs up for sale) would become more common – in December I wrote a post on some criteria for deciding ‘how much to sell your blog for’ but to be honest I’m still unsure how I’d do it if someone made a serious offer. Any thoughts on how you’d tackle setting a fair price for your blog?

About Darren Rowse

Darren Rowse is the founder and editor of ProBlogger Blog Tips and Digital Photography School. Learn more about him here and connect with him on Twitter, Facebook, Google+ and LinkedIn.

  • first, don’t consider it as selling a blog. Look at as selling a business or better yet a publication.

    Do you make money from it? If so, how much do you make in a year. Are their expenses involved with running it (i.e. do you pay anyone to write for it)? How much effort does it take on your part to bring that income in? After that, I would estimate maybe 3-5 years income minus some expenses and say that’s a reasonable asking price.

    BUT… Think about what you are selling. Are you selling just the domain name? Is the publication a sub domain of another site (like your digital photography site). Do they get control of just that subdomain, or will they be buying the whole site. Do they get exclusive rights to all the content on the site? What if some of that content is all ready reprinted in another place. Many bloggers post reviews and articles on other sites for exposure. Will there be any future commitment from you involved?

    All in all, I think the question is pretty complex and involves a lot more than what is the blog worth. In fact, I think the more important question is “what will they be buying.”

  • Basically, they are buying a combination of your cash flow (the most important factor) and goodwill. For cashflow, you need to consider three things.

    First, you need to know how much the money you get could earn you in your best alternate use. That will vary with your risk tolerance, anywhere from a couple percent sitting in the bank to 8-10% if invested in diversified mutual funds (still pretty low risk if you buy and hold).

    Second, you need to figure the net present value of your projected cash flow. You’ll use the yield or interest from your best alternate use of the money to figure that. (It will be your “discount rate” or “r” in the formula). The present value formula is fairly complicated, but you can do this with a good financial calculator or a good spreadsheet program (I know Lotus 123 and Excel both can do this). Commerce Clearing House has an explanation you might find useful. It may be tempting to base your figures on 20 or 30 years cash flow, but you should be realistic. Given the track record of online businesses, if you can get a price based on 5 years cash flow, you’re making out like a bandit.

    Last, you have to adjust for risk and other factors. That is largely, but not entirely, personal. For example, if your discount rate is based on just putting the money in certificates of deposit, that is a lot lower risk than hoping your success continues for several years. So, you need to adjust for the fact that you are reducing your risk compared to continuing in business. Reduced risk = reduced reward = lower sale price.

    If they expect you to continue running the blog, they should expect and you should insist that they pay you a salary for doing so. If they want you to sign a noncompete agreement, have a lawyer look at it and make sure it is narrowly drawn to the topic of the blog you are selling, so it doesn’t interfere with your future (or current) blogging efforts.

    So, why would anyone ever buy your blog? Well, they may think they can increase cash flow, that it will synergize with something else they are doing, or they may just have a lower discount rate or higher risk tolerance than you do.

  • I would sell if given a competitive offer. There are enough other projects that I could work on (and use the newfound capital to fund) that I wouldn’t skip a beat.

  • All very informative comments and helpful. I’d find it abit hard to part with a blog that I’ve poured too much passion in. But if I had to sell, I suppose I’ll think about it like how Tom has illustrated. I’d try to imagine it’s worth down the road and maybe the ups/downs of what might happen then sum up a figure around it. :)

  • I’m with Tom. Reduce it to a series of cash flows and figure out which you’d be better off with. Ignore the fact that it’s a blog… Pretend it was a digital photography B&M store.

  • I’ve though about selling in the past as well, and I did sell off a few blog projects early last year, but as lightly developed sites that only made a couple of hundred on ebay. To part with the Blog Herald though would be difficult because of all the hard work and dedication, it would be nearly like selling your child. Having said this though, everything has a price, and if the price was right I would sell, but my idea of “right” is pretty high :-)

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  • It’s interesting when selling blog becomes a trend, till date we do not have a parameter on trade price, I guess the best way maybe making somekind of platforms on how the mechanism is worth and industry required for, just like selling and buying domain, it would be similar though.That’s what I think.

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