- Apr 9, 2009
That may work for a completely dead forum with ZERO revenue... but how the hell can you make an offer on an active forum which is well monetized without knowing the income and expenses?I'm not a fan of time wasters, and I don't want to waste my time either. If I think your forum is worth $500 then I'll offer you that in the initial email, and maybe you'll take it, maybe you won't. I've been successful with this about 10% of the time (as you mentioned). If I don't hear back from them, then they wanted $5000 for their $500 forum.
That's how I avoid disappointments.
I would not take anyone seriously if they just sent me off that email.
THE ONLY folks who would accept it are those that know their forum makes zilch, is dead, and just want to cash out.
Active community owners would just laugh it off.
As far as being on the other side of it, if you do not want to disclose your revenue and expenses, how the heck do you expect to get a realistic offer?
If you don't want to disclose it, then you will have to settle for a conservative low ball offer.
Otherwise, disclose and get estimate on multiple. i.e.
Buyer: I am looking at your forum, interested? revenue? value?
Seller: Sure... I would need $10k.
Buyer: Ok, in my budget. How do you value it at $10k?
Seller: Forum is active, blah blah blah, and generates $2k per year.
Buyer: Ok, sounds about right but as you know multiples dropped off and there is uncertainty, I would be willing to offer $6k, which is 3x multiple. Sound about right? If so, we can move on to due diligence and verify the numbers and then close the deal.
Agree in principle, then provide proof with a signed non-disclosure agreement.
As long as the numbers check out (financials) the big thing would be to see if the traffic will survive to recoup your dollars and what amount of that revenue will continue in the future.
If something does not check out, you can always go back and renegotiate the price or simply walk away.
If the site is dead, then the only value is the traffic from search... and I would look at analytics and apply your expect page revenue multiples to that to come up with your value.