Someone made me an offer. Need advice

I made an affiliate site last year. Between June 1 and Dec 31 it earned $4800 US. This year it has been pretty consistent earning around $1,000/mo having earned just over $11,000 ytd. Someone recently approached me (via email) to buy it. He asked for my traffic stats, earnings stats, etc and I provided all of it for him. He came back with an offer of $7,500. I’m not desperate for the money and considering that it will only take 7.5 months to earn that much from the site, it doesn’t seem like a high enough offer, however I’ve never sold a site before so I could be way off and be called a fool for not taking his offer. Several years ago I read an article about selling sites and it said that 1.5 to 2 times the annual revenue is the starting point for the offering price. In this case that would be $18,000-$24,000, but like I said, I don’t know the ins-and-outs of this process so maybe that statistic has dropped considerably over the years.

I’d like some voices of experience on this.

You don’t need a rule, just use your own common sense.

If you know the income is stable and you have no need to get some cash now instead of more cash later, then don’t sell.

If you need the cash now more than you want more cash later, then sell.

If you know the income is not stable and you’re not going to make that much for a long time even if you hold onto the site, then sell.

theGWS, I put together a little guide to valuing your site which may be of interest.

There isn’t such a thing as a standard starting point or standard multiple for site valuation, though there are a million myths around. There isn’t even such a thing as a single correct value for a given site. A deal happens only when both parties agree a price. So if you set a minimum figure in your mind, any offers above that from people who have the money to buy are all good valuations.

And the best way to complete a deal at the highest of those valuations is to put your site up for competitive bidding in front of the right audience. Sometimes Flippa does that.

If you have proven net income of $1000 per month for an entire year, the site has staying power, isn’t operating in a legal gray area, and doesn’t require a lot of maintenance, you should be able to get at least $10,000 for the site.

That said, Dan’s and Fruit’s advice is right on. Come up with your own value, and don’t sell below that price unless you need money immediately. If you do want to sell, put it up for auction and see what happens. There is no need to accept this guy’s lowball offer. The site sounds like a nice asset to own.

Better don’t sell. I read your income details and I think its very much stable and you can earn more than for few $ right now.

I think you could get more. I wouldn’t sell, especially if it’s a low maintenance website.

If you don’t need the money, maybe an offer like this will motivate you to try and increase your sites earnings. Someone has taken a liking to it and they may have ways to improve upon it in such a way you have not thought of. My advice is to think outside the box and look for ways to increase revenue and expand. $7,000 is a very low number I would agree with revenue times 18 or 1.5 years in this particular case. The .5 is based on the assumption that the value will continue to increase, better page rank, more revenue, and so forth…

My apologies. I forgot to follow up on this. Anyway, I showed the guy the numbers (earnings, visitors, etc) and told him I would need an offer greater than $7500. He said no problem, let me run some numbers and I’ll get back to you with a better offer in a few days. I never heard from him again.

That’s not unusual. I get emails from people interested in one of my sites about once a month, and usually they don’t ever respond with a serious offer.

Honestly in my opinion I think you should keep it and possibly in the near future you can increase that income…best of luck.

Edit: “Ouch…yeah people do that”

If you’re not hurting for money, then based on what you’ve told us, $7500 seems very low to me.

Yep. I’m gonna keep it and use it to buy an airplane… or at least pay for the fuel.