There’s big money in buying and selling websites. For example, AOL coughed up $30 million to acquire the tech media firm, TechCrunch. Huffington Post was sold for 315 million, also to AOL. Of course, not all websites and domain names are going to pull in a fraction of that money. Still there are plenty of transactions generating lots of revenue due to the sale of websites.
So could you make a profit selling your website? It’s quite possible. The average sales price of websites featured in the DN Journal’s weekly listing of domain sales was well over $400,000 in the first quarter of 2017.
Yet, not all websites are created equal. The amount you will receive will depend on the valuation of your site. If you wonder how much you can get, consider these factors:
Obviously a long standing, well-known site with proven profitability is going to bring in more money than an abandoned startup where the value lies solely in a clever domain name (or the one closely resembling a popular brand).
Of course, selling a website isn’t the simplest task. Both buyers and sellers must do their own due diligence. There are also technical and legal considerations. Because of this, most people opting to sell websites or domain names choose to use a broker.
Just like in real estate, website brokers facilitate the sales process and help you position your website for the highest price possible to a possible buyer. You can expect to receive help with the following:
Determining an appropriate price of your website.
Preparing a marketing strategy for the sale.
Attracting, screening and showcasing your website to reliable buyers.
Assisting during the negotiation stage.
Conducting the due diligence.
Drafting and presenting the final offer and assisting with all the related paperwork.
If needed, protecting seller’s confidentiality.
Intermediating the sales process (including funds transfer and contracts).
Typically, using a broker simplifies the sales process and helps you weed out the non-serious buyers. Most companies typically have well-developed marketing channels that are not accessible to the regular folks and a well-established network of buyers, meaning the sale is finalized faster.
If you plan to sell a website, the next four companies may be of use to you:
Based in Los Angeles, Digital Exits brokers the sale of websites that have revenue between $100,000 and $3 million per year. They offer a free website valuation so that you can know what to expect in terms of pricing.
Further, they work with buyers who have the capital and motivation to purchase high-end websites grossing over six-figures per year. Their team will create a marketing plan to attract the right buyers and facilitate at every step of the sales process.
Flippa is an online marketplace where buyers bid on websites in a fashion that is similar to Ebay. Most listings run around $10,000 and the deals include websites, domain names, e-commerce stores and even apps. Yet, considering the price tag, don’t expect to purchase a highly-profitable business here but rather a promising new website or an aged domain with history.
Empire Flippers is an internet marketplace that specializes in buying and selling of small e-commerce and affiliate websites. On average, deals brokered through the site were $50,711.
The perk here is that the company requires that potential buyers put up a five percent deposit before they are given information on any website. This helps to weed out those who are simply browsing. Sellers are expected to pay a listing fee as well though.
Unlike the other brokerages here, FoundersIB operates in a different fashion. It’s an investment bank, specializing in selling companies with profits that range from $3 million to $20 million annually.
For sellers, the company will provide underwriting, create a marketing and negotiation strategy, engage in a rigorous due diligence process, and help close the transaction. Considering the average deal number, FoundersIB also brokers partial sales and buyouts. The industries the serve include technology, manufacturing, petroleum, healthcare, and internet/digital media.
No the status of your website today, there’s potential for you to earn money by selling it. The key to making a good profit though is to chose the buyer wisely, do the due diligence and make sure that the paperwork is in place.
The opinions expressed here by Inc.com columnists are their own, not those of Inc.com.