How to Sell a Site with Domain Magnate – Domain Magnate

How to Sell a Site with Domain Magnate

So you may have just started your research on how to sell your website, or perhaps you’ve heard about us and are curious about how we do business.  Or maybe you’ve had a bad experience trying to sell already and are curious about your options.  However you got here, this article will provide you with a total overview of how our process works, how to figure out your best asking price, and how to complete the transaction.

Have Your Numbers Ready

When we are discussing numbers, of course we are talking about things like:

  • traffic sources (the more diversified, the better, and the more detailed the better.  For example, don’t simply say “37% of traffic comes from referrals.”  Break that down further by telling us the 3-5 most significant referrers in that 37%, and why they are so.)
  • long history of detailed stats (if you need we have a helpful post on how to use videos or screenshots for proof)

But we are also talking about:

  • how much time it takes to run your business (not just hours/week, but number of tasks to be completed)
  • costs of running your business (this must be complete and thorough and include occasional costs apart from regular recurring ones)
  • profit margin (if you are using a total blended margin for different revenue streams, it will also be helpful to have the standalone margins as well)
  • legal history (be able to prove that there is a clean legal record for the business)
  • any additional helpful information – for example, is there seasonality in the business, or are you doing something for the site that you happen to love but could easily be outsourced, like coding or writing.

Know Your Asking Price

When we first got started 15 years ago, it was understandable that many people didn’t really have a good sense of what they might ask for the price of their business.  But now there are many helpful articles on the internet, podcasts, videos, and even marketplace sites where someone can do research to find out an appropriate price for the business.

We say appropriate because a business is only worth what someone is willing to pay for it, not what you think “your time” was worth.  It’s also only worth what other similar business have been bought for in recent history.  Like real-world real estate, internet real estate does make use of “comps.”

That said, different businesses are valued differently.  Here is a list of some factors that are reasonable to consider:

  1. Sales (is there consistency or an upward trend?)
  2. Profits (both gross and net)
  3. Growth trends (how quickly is your industry growing?  how does your business compare?)
  4. Business position (where are you relative to the competition?)
  5. Long-term value of the site (is this a business that will still be relevant in 5, 10, 15 years?)
  6. Scalability (can the site produce even more income simply by making adjustments to scale up?)
  7. Systems-in-place (can a new owner simply and easily take over?  Is there an “owner’s manual”?)
  8. Opportunities (perhaps the most exciting item for a buyer – how can he/she take what you’ve done and go to the next level, thereby not only recovering the investment but making it worthwhile?)

Finally, as we noted above, do some research on the competition.  Browse sites or send emails to find out what comparable businesses have sold for in the last 12-18 months.  If you can’t get an exact number, at least try to find out a range.  It will help cross-correlate the work you’ve done on coming up with an appropriate price above.

Many times we will be contacted by a seller who tells a wildly unrealistic sales price.  When pressed, he/she will respond that “that’s what I consider to be fair” but almost never have they looked at more than one of the factors we’ve mentioned above.  A smart seller also removes his/her ego from the equation and focuses on the fact that we’re trying to close a deal and that’s about numbers and cold hard facts, not emotion and wishes.

Submit your details for an evaluation

If you’ve done everything above, you’ll have everything you need to start the transaction process with us.  You can go to this link and share just a few basic things:

  • Your name and email address
  • Your website URL
  • Your total net profit in the last 3 months in USD
  • Your desired asking price in USD

You can also note whether you are looking to sell quickly or whether you are simply looking for some advice and feedback and have a longer selling horizon.  We are happy to help either way!

Once you click submit on that form, we will get back to you within 1-12 hours.  We might exchange emails before arranging for a phone call and/or video chat.  There may be more details requested after that contact.  Once those have been received (if necessary), we will get back to you within 12-48 hours with an offer from ourselves or an offer to broker your business for sale.  We may also decide not to purchase from you and will tell you why it’s not a good fit at this time.  On more than one occasion a seller has taken our advice, come back to us a few months later having implemented some of our suggestions, and sold to us on that second contact.

Our offer will include any post-sale terms, like transition time after the sale and any support that can be given from you.  If the systems you have in place are very solid, very often we won’t need to contact you much, if at all.

Proceed for a Secure Transaction

After details have been discussed and agreed upon we often sign a brief sales agreement, that outlines the standard terms, process, and exact procedures and following that the transaction is setup through escrow.com or another secure escrow service.  As you can see from the process above, a website can be sold very quickly, and on more than one occasion, the entire process can happen within 24 hours. 

Complete Deal, What’s next?

You’ve done what the majority of website owners have not been able to do: monetize their hard work.  You did it because you put together an asset of value, with repeatable and/or recurring revenue, that was easily manageable from anywhere in the world, with documented processes and systems so that the new owner can take what you’ve done and improve on it.

Sometimes this is enough for sellers.  They’ve gone through the process from start to finish, have a reward, and decide that’s enough for them.  Others have already started their next project before they’ve even completed the sale.  And yet others take the experience they have from going through each step and either become an investor (for example, with a company like ours) or start their own portfolio of websites, being content to manage and improve properties to retain them for cash flow or to sell them on.

To start the process fill details here

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