How Much is My Site Worth?

By Daniel Scocco

questions and answersThis post is part of the weekly Q&A section. Just use the contact form if you want to submit a question.

Will asks:

People regard the amount of subscribers a blog has as a good indicator as to how successful the blog is in terms of popularity and monetary values. However I was wondering what your view on a blog’s value.

I am not sure if people really regard the number of subscribers as a good indicator of the monetary value of a site or blog. At least they shouldn’t.

I think the number of RSS subscribers is a good indicator of popularity and reach, but not of the monetary value of a website. A large RSS subscribe can add a premium to the valuation, but it is not the main factor affecting it.

So how much is a website or blog worth? The basic answer, which my friend Yaro Starak gave a while ago, is the following: Your site is worth as much as someone is willing to give you for it.

I agree with this definition because value is something subjective. For some people the ticket for the final match of the World Cup is worthless, because they don’t like soccer. I am a soccer fan, and therefore I would be willing to pay quite a sum of money for the tickets (especially if Brazil was playing in the final!).

The same is true for websites. A specific site might be worth $1,000 for someone and $10,000 for someone else. It depends on how well the site fits with the person’s business and future plans.

That being said, there is one factor that will have a large impact upon the valuation of your site: its earnings.

The most common mistake that I see people making is to assume that their site is worth a lot just because it has “potential.” Potential does not sell websites, earnings do.

Of course there are extreme situations where the potential could be taken into consideration. For example suppose you have a website that generates 50,000 daily page views but does not make any money because the owner never monetized it. That site certainly could be sold based on a estimation of how much it could earn.

But even in that case buyers would get suspicious. They would ask themselves how come the owner never tried to monetize such a huge traffic, and they would also need to estimate the potential earnings on the lower side.

Earnings equal revenues minus costs. Most websites have a really lost maintenance cost, though, so usually the revenues and the earnings will produce almost the same valuation.

Now, if my sites earns $x monthly, how much is it worth?

A good starting point is 24 times the monthly earnings. That is equivalent to two years of earnings. If your site earns $2,000 monthly, therefore, its initial valuation would be at $48,000.

Notice that this multiplier is usually applied to established websites, though. If your website is less than one year old, then you probably would need to consider a smaller multiplier, say 16x or even 10x monthly earnings. A site that was launched six months ago and makes $500 monthly would therefore be worth around $6,000.

Premium websites, on the other hand, can use larger multipliers, including 36x or even 48x monthly earnings.

On top of that initial valuation you can obviously include other factors, including the quality of the domain name, the existing brand, the number of RSS or email subscribers, the amount of organic traffic and so on.

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35 Responses to “How Much is My Site Worth?”

  • Ikki at Seo Blog

    I’d say: only you can tell how much your site is worth since you’re the only one who knows how much efforts and money have been invested on it.

  • SEO Tips

    I think there are a lot of factors which are important in setting a price tag for your Blog. One of the most important as you stated Daniel is that a website is worth whatever someone is willing to pay for it and you made a good metaphor out of that too.

    However I do think there are a couple of general factors when considering the price of your blog. I do think RSS Subscribers play a role in this too although I think its a secondary role.

    Let me explain, for someone coming on your website wanting to advertise their website they are going to take the amount of subscribers you have in to account and this will therefore enable you to put a higher price tag on your advertising meaning you will earn more each month which means after you multiply this amount your blog will be worth more.

    Obviously subscribers are not the only factor to consider in advertising pricing as well as your blogs price however I think its fair to say it plays a role.

    I realise I am adding a URL to your article again (second time I ve done this ever) but I hope you dont mind, if you dont like the article then edit my comment.

    I just feel it will be beneficial to the readers
    http://back-links.org/how-to-put-a-price-on-a-blog/

    If you want to know more about how to put a price on your blog then you can read that article I wrote its rather in depth at 3,000 words.

  • SEO Tips

    Sorry forgot to say thank you for answering my question too. So thank you ๐Ÿ™‚

    Also do you think the multiplier would differ depending on the market the website is in?

    I say this because a website which might be on a very popular TV show might be making $6,000 a month and been established for 12 months but the content and the whole site has a risk of becoming out dated through new TV shows and the end of the TV show they focus on.

    Any thoughts?

  • Andreas Nurbo

    I agree with that RSS subscribers do not alone decide the value of a site. Things like email subscribers could also add to some part to a sites value.

    There is many factors really that can contribute to the “price” of a site in conjunction with earnings.

    Nbr of visitors, time spent on site, nbr of uniques visits

    The simple approach to get a starting number is like you say to just multiply monthly earnings with 24.

    But if the worth of a visitor is $0.10 and the site makes $2000/month there is room to increase the sites value. So here comes the “potential” in.

    If you discount potential then for example investors wouldn’t invest.
    You don’t only need to know a sites worth in order to sell the whole package. You need to know it if you want offer an investor a deal on it also.

    Potential is the whole point for investors but you as the owner might not be objective when it comes to that (as learnt by watching Dragon’s Den)

  • Rarst

    So I am worth something like $10… Those automated sites claiming to estimate my blog’s value at $15K are bit off. ๐Ÿ™‚

  • Daniel Scocco

    @SEO Tips, yeah I think niche might affect the multiplier.

    The more narrow the niche, the smaller the multiplier, and vice versa.

  • Daniel Scocco

    @Ikki, I am not sure if I agree with that.

    How much time and money someone dedicates to his site is not directly related to how much the site is worth.

    Suppose you have two bloggers: A and B. Blogger A works for 10 hours a day on his and invests $10,000 in web hosting, design, advertising and so on.

    Blogger B, on the other hand, just focus on keyword research and SEO, and works only 1 hour a day and invests only $100 for a logo.

    After one year, Blog A is receiving 1,000 visitors per day and making $500 monthly.

    Blog B is receiving 10,000 visitors per day and making $10,000 monthly.

    If both bloggers were to sell their blogs, Blogger B would get a lot more money, despite having investing a fraction of the time and money.

  • Allan Ward

    A couple of factors to consider.

    Selling a blog is no different to selling a business. The price is determined by how much someone wants to pay for it.

    If you value it on a multiple of earnings, maybe 2 times the annual revenue gets you a rough figure. You could also value it on EBIT (i.e. after expenses) at a higher multiple of maybe 6-8 times.

    I’d place a higher weighting on the nature of the revenue i.e. recurring revenue is worth more than one-off revenue. For example, if you sold memberships or subscriptions that were based on monthly fees, I’d value that around 2 times the revenue. If your revenue was mainly from sales of one-off items (like an e-book), I may only value that at a lower multiple, because it is less likely to repeat.

    I’d also look at the content of the blog. If it’s heavily dependant on you, then as a buyer I’d need to allow for the fact that I need to find a way to produce the content you provided. If I outsource, this adds to my costs and reduced the profitability.

    These are all only suggestions. To get the best price you need to create an environment where a number of people are given a limited time to place tenders or bids for your site.

  • Pinaki Ghosh

    I would like to add to Daniel’s article: 24 months’ earning is correct. However one should note, we are talking about ‘net earning’ and not ‘gross earning’. The term ‘earning’ can be confusing. ‘Gross earning’ is the total earning from your site before expenditure. The ‘net earning’ is the earning left with with you after meeting all expenses. For example your gross earning may be $3,000 pm. Monthly expenses: $1,000. Thus your ‘net earning’ is $2,000. You should multiply this ‘net earning’ by 24 (or other figures) to evaluate your site.

  • Florin

    So…. if I sell adsneeze.com I’ll get from 2400$ to 3600$, I think its way to cheap…. I think I don’t want to sell at this prices, may I wait 1 year or 2

  • Rajeev Edmonds

    This post reminded me DBT’s last year post of 1st April ๐Ÿ˜‰

    Some interesting calculations Daniel. Yaro summed it up very well. It appears there is no hard and fast rule to assess blog’s worth. Just play your cards and hope for the maximum.

  • odtaa

    The true value is, as Yaro says, how much someone is prepared to pay for it. If someone is approaching you to buy your site, then try and find out why.

    Years ago a friend of mine had a website called Line1. He was approached by what appeared to be an indivivdual offering around a couple of hundred pounds ($300).

    He did a bit of checking around and found out that it was in fact being bought for a large corporation that was going to launch LineOne, which was going to be one of the UK’s biggest ISPs. (It’s now been absorbed in a take over)

    He hummed and delayed and the price went up to well over ten thousand, when he reluctantly sold.

    Ironically he was about to give up the website anyway as he was not getting much traffic.

    I think the point about being around for a couple of years and building a reliable visitor base has to make a site a higher value, than one that’s been around for 6 months.

    The other point about selling: The buyer’s not interested in hearing how much work, effort, blood, sweat and tears you’ve put into the site. They’re only thinking of how value the site is to them.

    If you understand the sale from the buyer’s point of view, then you can negotiate much better.

    And walk away if you feel you’re not getting a good deal.

  • Ikki at SEO Blog

    @Daniel: what if blogger A also invests his/her time doing SEO and gets as much (or more) traffic as blogger B?

  • bloggeronline.net

    $10000/month??
    crazy

  • Blogging Tips

    very nice comments, well l also think the worth of a website is up to the peoples interested in with ur site, how much they need it or how much it helps on their goals. their effections will be based on the traffic of your websites mostly and the source of ur traffic is the main issue, also rss subscrubers and registered members also a plus, but l think even if u dont have enough rss subs or registered members, the traffic comes from google is still the high percent of effections shocking peoples who wanna buy ur site.
    some time ago, l sold a website that was worth nothing for me, blocked by google, l was thinking to close the site, but than l wanted to sell it. be4 it was blcoked by google it was earning 150$ monthly, even after it is blocked by google l sold this website to 2000$ just cos of traffic thats comes from google.
    so for me, traffic is still very basic and highest identifier.

  • Steve

    Obviously your website is only worth what someone is prepared to pay for it.

    I have bought and sold real world businesses over the last 15 years. I have always calculated value based on a Return on Investment. Usually based on a multiple of the nett profit.

    So lets say you have a blog that is bringing in $5000 per month and it costs you $2000 to do that. You then have a nett result of $3000 per month or $36000 per annum. Now you just have to decide what is a fair multiple. A multiple of 1 gives 100% ROI. A multiple of 2 gives 50% ROI. A multiple of 5 gives 20% ROI.

    The other area that business owners often forget is the value of time. If you are making $3000 per month nett from your blog but have to invest 300 hours per month to do that then you are working for $10 per hour. I know this is unlikely but it happens alot in offline business. If you only have to invest 30 hours per month to do it then you are working for $100 per hour.

  • Tyrone

    I think only the money and time invested in the site and for the SEO of the site is not everything. We should look at all the aspects of the site.

  • Exchange

    What make site worth is when it is already make money for a while and the other when the website has “most wanted domain name”small sample is toy dot com.you know how much that site will when toyRus company bought it

  • Ruchi

    Great I was not aware about all these calculations.

  • Tyrone รขโ‚ฌโ€œ Internet Business Path

    I do not know. But that depends on its attractiveness, content and importance…will that help? Cause what i do is to help businesses.

  • Blog Promotion Quotes

    How much time and money someone dedicates to his site is not directly related to how much the site is worth. To come to a website valuation should take into account its niche, quality of traffic, content, authority among other factors.

  • Blog Promotion Quotes

    On top of that initial valuation you can obviously include other factors, including the quality of the domain name, the existing brand, the number of RSS or email subscribers, the amount of organic traffic and so on.

  • playwithmusic.dk

    my website it worth 1000 i just startet with webmastering cool.. visit my page and download free hiphop beats..

  • Ashish Kalmegh

    The automated sites show my site is worth 1500$ some show it as 13000$ ๐Ÿ˜€

  • james@fish tanks

    What about a site that just generates plenty of traffic, but has heaps of potentail for a particular product?

  • SEO Company

    I agree with you that it’s only worth what someone is willing to pay. I disagree with the mindset of valuing a site based on how many subscribers there are. This can easily be inflated and if its in a niche where there isnt much opportunity to sell products etc.. you’re screwed.

    I would always look to see where the traffic is going and to see what the monthly revenue has been over a year.

    Nice article and glad to see you’re educating people.

  • dave

    24x is a very rough estimate, if you look into finance there is a specific formula to calculate the present value of an appreciating asset.

  • Guitars

    Good points being made by the author and in the comments. I am sure we’ll see more and more of this “what is a website worth” stuff now that lots of people are trying to start online businesses.

    Also, some people will buy a site based on the name or the amount of traffic, regardless of how much money is being made (because they plan to improve the site so that it will make more money)

  • medyum

    very nice comments, well l also think the worth of a website is up to the peoples interested in with ur site, how much they need it or how much it helps on their goals. their effections will be based on the traffic of your websites mostly and the source of ur traffic is the main issue, also rss subscrubers and registered members also a plus, but l think even if u dont have enough rss subs or registered members, the traffic comes from google is still the high percent of effections shocking peoples who wanna buy ur site.Medyum

  • Business man

    There are some sites that calculate the value very accurately…

    I wonder how they do it.

  • Dale

    My site ineed-electronics.com is worth about 86 U$D from some evaluation website, anyway, what does it matter As long as my potential customers can find my website?

  • Doug Johnson

    I’ve used several auction sites for a while now but the problem has always been the listing fees. I just found a new site called JustClickAuctions.com that lets me add listings for free so I’m going to give it a shot. The site looks pretty amazing. Regarding valuation, it all comes down to what the buyer is willing to pay. You may believe it’s worth $X but at the end of the day, it all comes down to what you can convince the buyer it’s worth. Great post!

  • Eryaman hali yikama

    Good info thanks for sharing with us.Nice information, valuable and excellent, as share good stuff with good ideas and concepts, lots of great information and inspiration, both of which we all need, thanks for all the enthusiasm to offer such helpful information here…

  • Accounting Rashid

    I have an acounting site. Earnings are $2500 from adsense and I want to sell it for $80000. Anyone interested? Proof of earnings will be provided. Traffic is 400000+ page impressions per month.

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