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How Much Would you Sell your Blog For?

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.

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Comments

  1. Nicholas says:

    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.”

  2. Tom Hanna says:

    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. http://www.toolkit.cch.com/text/P06_6530.asp 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.

  3. Jon Gales says:

    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.

  4. dannyFoo says:

    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. :)

  5. Sean says:

    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.

  6. Duncan Riley says:

    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 :-)

  7. 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.

Trackbacks

  1. BlogWorks says:

    BlogLogic Not Closing, After All

    Just two days after announcing that financial pressures were forcing him to sell the BlogLogic network, Paul Short has reconsidered and will press on.

  2. [...] In 2005, Darren Rowse of ProBlogger wondered how much you would sell your blog for, noting that timing is everything. How much would you sell your blog for? How would you determine it’s selling price? [...]

  3. [...] When is the Right Time to Sell Your Blog? How do you know when it’s time to sell your blog? Brazell admits he needs a change. He’s ready to jump off the cliff and sell his blog. Many of the blogs I found listed for sale admit that the owners have just gotten bored or have too many blogs and something has to go. What would make you sell your blog? In 2005, Darren Rowse of ProBlogger wondered how much you would sell your blog for, noting that timing is everything. 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. How much would you take right now if someone offered to buy your blog? How much would you have taken a year ago if they offered then? Is there a right time to sell your blog? When would be the right time for you? Many sell their blogs when they are bored or finished with them, but is that the right time to sell your blog? The right to sell is when it is at the top of the charts. When it is doing its best. After you’ve just had two or four hits from Digg, Wired, or other traffic generating sources. When your blog is getting the most attention, this is when it has the most value and looks the best to buyers, right? You aren’t just selling a blog, you are selling what the blog is built on: the return readers, reputation, quality content, and incoming links. When the blog is doing great, you will probably get a better price than when it is doing nothing. [...]