Calculate the selling price of an affiliate site?

[OCGuy87]

Hi guys

I have a casino affiliate website. The site generates €3000 a month. Revenue is even growing slightly.

The site is very high quality. A custom design was created, a lot of programming, perfect page speed values, increasing visitor numbers, increasing rankings.

Two potential buyers have now written to me and they want to know a price. How do you calculate the sales price for a casino affiliate site?

I know that affiliate sites often use multipliers such as 36 x monthly revenue. However, I think that's a bit low, considering that €80,000 was invested in content alone.

Best regards & Thanks!

 

[AussieDave]

If your talking that sort of value; that's if everything you say is true, seek the assistance of a website broker.

BTW a site is only worth what someone will pay for it.

If your sites only producing 3K per month, from 80K of content (which is a shit ton), I'd be really concerned...

 

[NDG]

It can depend on so many different factors.. monthly revenue, domain authority, the domain itself, the website
design, content developed, how the backend runs the website, is it still ranking, what is it ranking for now, etc.

The best advice is to look online for other websites that have sold with similar metrics and try to come up with a price.

 

[edgarf76]

you can get a good idea by looking at sites like Flippa.

 

[forumsaddict_reboot]

80k ? You can literally setup a proper brick and mortar medium sized business with actual customers with that sort of money.

If the amount you mentioned isn't BS, then you were definitely taken in for a ride.

 

[TheGooner]

It depends a bit on many things.

If you want 3 years (36 months) revenue then you should have :
a/ History of at least 3 years showing that revenue each month / year to show longevity.
b/ Details of player base to show it isn't just ONE or TWO big players (who may stop tomorrow).
c/ list of assets, and liabilities (contract writers, coders, paid links?) of business for sale
d/ hours per week new owner has to put in to keep it operating.

Because affiliation is high risk - and many programs stop paying out "life-time" rev shares - a number like 36x monthly seems high with 12x to maybe 24x monthly is more likely.

Your sunk costs are irrelevant, no-one really cares how much you spent to build a site, paid for content, or hosting in the past. It's not relevant.

They're just looking at the money in and cost of operation NOW.

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As an example :
- Site makes 3K per month
- Pays 500 a month in links, content, and coding work.
- New owner expected to put in 1 hour a day to keep it running.

The site makes 2.5K net each month BEFORE owners time is also a cost (they may put someone in place to do work) at (say) 20E x 30 hours = 600 E .. so really only 1.9K per month free-flow cash.

Let's say 2000 euros per month by 12x = 24K offer or maybe 24x for a 48K offer.

If you have longevity and a good partner program, and it's a turnkey low effort op (and the affiliate account and websites are registered to a company) then maybe more.

So I think 12-24 monthly is fair , 36 a rare good deal , but I personally want 48-60x to sell my site.

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For most operators - it just doesn't seem right - but that's pretty much the basic value - unless you have some IP in a well-known and memorable website or 20 years longevity.

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Coffee shops and Newsagents shops (which might be a real world comparison of affiliate sites) often trade at just 1 x annual earnings. Like affiliate sites they're relatively common - and usually rely on operator effort to succeed.

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As a final real world example - I've been running since 1999 - my site makes good money although it's peak was probably the "good ole days" of 2003 to 2010 before regulations and restrictions.

I've had several / many offers - some with big groups - and some talks went into financial details.
But no-one ever offered more than 2-3 x annual free-flow cash.

And if I was going to sell - I'd probably want 5 x annual free-flow cash - otherwise it feels like giving money away - and it seems easier to keep things ticking over and make money monthly.

You probably feel the same way?
;-)