Selling one of my sites

February 4th, 2010 by Chris

I’m selling one of my sites, for various reasons.

My coupon site was once my highest earner, pulling in over $1000 a day. One month’s revenue was the down payment on my house. Then I lost my rankings due to Google algorithm changes which favored a breadth of incoming links instead of a few really strong ones. My competitors starting making spam sites and using other methods to create tons of really low value incoming links. I did not want to compete like that. Unfortunately for me during my heyday of popularity I didn’t do something which I now consider to be a rule for all of my sites: build a forum. Because if you can get to critical mass with a forum your search rankings become less important, people will still come.

Additionally, at almost the exact same time, the ecommerce side of my business took off, doing $4000 a day in gross revenue in December of 03. So I shifted gears really. I’ve been very lucky, I’ve had so much success, and not just at one thing, I’ve had multiple ideas or sites become successful independently.

In the intervening years the industry changed and while it is still probably the single most profitable niche for a an affiliate content site (IMO) it is more competitive and requires a larger software investment and time investment. New coupon sites with innovative Web 2.0 features were launched, mine stayed the same because was focused on other things.

Last year I paid someone to reprogram the site and incorporate some Web 2.0 features, they did the work, but I never did the finishing touches I intended to (like a better design, automatic importers, launching the forum, etc). Meanwhile, I feel pulled in too many directions. I have a baby now, I have a todo list that is quite long, on sites I’d rather work on than a coupon site, and my ecommerce businesses keep growing and growing.

I don’t actually like affiliate marketing that much, mostly because I don’t like affiliate programs. Merchants move offers, change offers, expire offers. Many do not adopt standard methods of automatic communication (more need to use RSS). Programs will get terminated without warning, or maybe just you will be. So to run a website that in the end is just an organization of affiliate offers is not what I prefer to do. I prefer to do ecommerce, or strict content sites. I like to write, I like to publish, I like content that I can publish once and let it earn for me forever. I do like some affiliate programs, but with a coupon site you need to manage hundreds, and that is not my favorite task.

I’ve actually had this site up on the market for awhile, but only passively, I decided to give Flippa a try though and see if I’d move it actively. I figured with my taxes likely going up soon it’d be better to move it now, than a year from now.

In less than a day I’ve already had some private interest, perhaps I should have put the minimum offer higher. It looks like it’ll probably sell, only question is to whom and for how much.

If you’re interested, the listing is here.

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Posted in: Uncategorized »  by: Chris

5 Responses to “Selling one of my sites”

  1. Kevin Muldoon  Says:
    February 26th, 2010 at 6:54 am

    I’m coming to this post late however I really relate to a lot of what you said.

    In the past I have not been proactive enough with sites that were making money. It’s too easy sometimes to move onto another project if a site is consistently making decent money with very little effort, though it does pay to stay ahead of the game.

    You make a very good point about forums. In fact, so much that you have inspired me to add a forum to a small content site I own. The site only gets a few hundred unique visitors per day (via analytics) however the traffic is very targeted and it’s a very small niche. The site is currently making about $40 a month via adsense so I have added a forum in the hope that overtime some sort of community will develop, which will increase both traffic and income.

    I do agree with you regarding affiliate programs. I started about 10 years ago building sites to promote affiliate offers (my first site was a shopping directory, my next main site was an affiliate directory) but you are 100% right.

    In order to make money through affiliate marketing nowadays you need to spend heavily and do a lot of testing in PPC marketing.

    Previously, I would write articles and inbed affiliate codes within them so that income would be generated after 3-6 months. However, as you quite rightly point out, many affiliate programs get cancelled, withdrawn or change their link structure. Which means that even if your article is getting traffic, you’re getting no commission.

    Today my main focus is on blogs and content sites, though I am looking into developing another big community (I sold my last big one a year or so ago).

    Looks like you have sold your coupon site. congrats on the sale :)

    Kevin

  2. Chris  Says:
    February 26th, 2010 at 8:55 am

    actually I didn’t sell it, the buyer backed out, so it has been relisted.

  3. Kevin Muldoon  Says:
    March 1st, 2010 at 6:58 am

    I really think you will struggle to get anything close to your minimum offer price on Flippa. $50k is a ridiculous amount for a site which is getting 120 daily uniques and making $200 a month. It only has a PR of 2 as well.

    I appreciate that the site once made money, but it isn’t anymore. I’m not trying to rag on you, I just think you need to be realistic. I’ve sold many sites via Flippa and most sites like this sell for between 8 and 24 times the monthly income. So at best you’re looking at getting around $5,000. At $50,000 it would take the buyer over 20 years just to break even.

    Look at your site objectively as a buyer. Would you pay $50,000 for a site which was getting 120 visits a day and making $200 a month?

    I recommend checking out other sales on Flippa to get a better idea of how to price your site.

  4. Chris  Says:
    March 1st, 2010 at 7:37 am

    I’ve paid as high as $4k for a domain without a site even attached.

    If I could buy a premium domain in a highly profitable niche that I wanted to compete in for $50k, I would.

    I could also more or less flip a switch and have that site make more money and get more traffic simply be redirecting some of my significant link weight there, which I stopped doing, and which I would expect any buyer to do with their own.

    I’m not selling bobsmyspacetemplates.com or easyebookcash4u.net, it is a premium domain using a generic keyphrase that is second only to the plain “coupons” (which would be a multimillion dollar domain) in popularity in the niche, which also happens to be, on an eCPM basis, the most profitable niche I have ever seen or heard of in 11 years of publishing content websites. Even more than mesothelioma.

    I’m also not a desperate seller who needs cash. My business is very profitable, my monthly cashflow exceeds my asking price for that site. So I can afford to sit on the asset rather than sell it for less than what I think it is worth.

    I would rather keep the site until such time as I am able to devote more time to managing it (or managing a contractor who manages it – finding good help that doesn’t need micromanaging oversight is hard), than sell it for less than $50k.

    The value of the domain is certainly not going to decrease over time.

    Oh… and I did already get the minimum offer once, the guy backed out, but initially he was ready to pay.

    I also would never sell any of my other sites for 8 to 24 times monthly income. That’d be ridiculous. Like, take my literature site for instance. It has brought in 6 figures in profit a year for 8 years. Pricing it like you would one of the stupid-niche-du-jour sites established in Sept of 2009 would be the definition of stupidity. I would sell it for 25x yearly revenue, (the multiple AOL paid for WebLogs Inc, which didn’t have much more traffic), but not 25x monthly revenue.

    I did have an offer for one of my sites recently… they were able to go as high as $100k on a site that did 12k in profits a year. I turned them down. If I took that 100k after taxes I’d have 80k, and to make $12k a year off that I’d need to invest it at 15%. Do you know a place to get a guaranteed 15% yield? That also still has a chance for growth? (as the site has been growing strong). And this year the site will probably do 18k thanks to the ad market becominn stronger.

    They did inspire me to invest more in the site and expand it (and after that is done, maybe more than 18k). But I told them I needed $250k for that site. They wouldn’t pay that, I wouldn’t accept less. We didn’t do the deal.

    Big company too, you’d know them if I said their name.

  5. Kevin Muldoon  Says:
    March 1st, 2010 at 1:51 pm

    It is an ok domain, though very few buyers on flippa look at the value of the domain itself. Again, I know this from experience. I sold a gambling forum the other year which had been online since 2001, but not one buyer was interested in that, they only wanted to know about traffic and income.

    I do appreciate that it’s an older domain, however from a buyers point of view, that isn’t a big selling point when traffic and income is so low. The domain will still keep it’s value, however the value of the site will continue to drop as you google will send traffic to coupon sites which are updated daily/weekly rather than every few months.

    Put it this way, if you had $50,000 to spend would you spend it on a website with 120 visits a day that makes $200 a day or a website which makes $1,500 a day.

    Alternatively, a buyer will look at the alternative of starting a site from scratch. I reckon most webmasters would be able to get a coupon site over $500 a month income if they had $50,000 to invest in it. They could spend $2,000 or less on a professional design, $10,000 on hundreds of original articles and lots of content and the rest on advertising.

    I’m not sure if you have an emotional tie to the site because you built it from scratch or because it used to make more money. Or id you think it should be valued more because of it’s potential, however potential means nothing to a buyer if it requires them to invest a lot of time developing it. Again, as someone who does buy sites semi-frequently, I always consider the alternative of starting a site of my own from scratch.

    Another forum I sold was making $2,500 a month when I sold it but at one point it was clearing over $20k a month. But, quite rightly, the buyer didn’t care about what it used to make.

    I have nothing but respect for you and the sites you have developed online. I started making money on the web around 2000 when you were an active poster and moderator at sitepoint, and your success stories inspired me. I know you are very experienced on the web and have been making a good income online for a long time. Though, with respect, I really think you have 0% of anyone at Flippa buying any site for 25 times yearly income. I disagree with the general consensus over there that content/affiliate type sites should sell for between 8 and 24 months income, though this is what most people believe. However, I do believe that 300 times monthly income for a small content site making $200 a month is crazy.

    I don’t know if your analogy of investing is correct when talking about online sites. It really depends on how much you update a site. One of the biggest commitments in owning a profitable site is maintaining it.

    I would definitely sell a site which makes $12k a year for $100k if I had to spend 15 hours a week on it to maintain it. Because I know that I can develop a site from scratch.

    In fact, I recently sold a blog for $60k on Flippa. I have banked the majority of the cash (less tax etc) though I am spending a little on the design for a new blog (similar but slightly different niche). And due to my experience with my last blog (and contacts etc), I reckon I will be able to get the blog to the same level with less investment and in a fraction of the time.

    From the sounds of it, you should keep the site. You don’t need the cash and I don’t believe you will get anything close to the price you want.

    Again, I reiterate that I am not trying to criticise you here at all, I have a huge amount of respect for you and the work you have done on the web. Going back several years, you also gave me some good advice on sitepoint when I messaged you so I know you’re a good guy :)

    I just don’t believe you will get this price because of how competitive the market is for sites over at flippa.

    Kev

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