I’ve recently been in talks with a media company that has expressed interest in purchasing GrownUpGeek.com. I made it clear to them up front that I was not really interested in selling, but I would listen to what they had to offer.
What is the real value of a website? The standard way to valuate a website is to take it’s average yearly earnings and multiply that by 1 year, or 3 years, or even 5 years. This would put the estimated sale value of Grownupgeek.com somewhere in the neighborhood of $300,000. Of course, if the buyer is more interested in just the domain name because it matched a new product or service, the value to the buyer could be much more, but sadly I have no such luck.
Going into the talks I knew/assumed that the company would already have an idea of the “standard” value of GrownUpGeek.com ($200,000 – $300,000) and I was already prepared to turn down an offer of that amount. WHY? Because the website will generate that much money in 4 to 5 years. If I sell the website today for say, $300,000 then subtract taxes, escrow fees, attorney’s fees, and whatever other fee’s that come up, I would actually be losing money as opposed to holding on to the site for 3-5 years. This does not even take into account the emotional attachments to “my baby” – I have spent the majority of the last 5 years of my life tending to, feeding, & caring for the website. It’s my hobby, it’s my LIFE! What the heck would I do without it? Sure, I would have a couple of hundred thousand dollars in my pocket – but I will have that anyway over the course of the next few years.
So when asked by the big media company “what kind of number did you have in mind Mr. W?” I responded with something closer to 2.5 times higher than “standard” value. (I could hear the gasp in the room).. Some kind of bargaining technique? NO – It’s just worth more to me than a few hundred thousand dollars that I will most likely see anyway in the next few years. Unfortunately the media company does not assign the same emotional value to a website that I do, and as expected, they thanked me for my time.
How much is your website worth to you? Do you assign any sentimental or emotional value to it? Even if it’s “just a business” to you, could you walk away from it for only 3-5 years worth of your current earnings? Am I just a sentimental fool?