Quote:
Originally Posted by AdultB2B
As someone who does this for a living I will tell you there is no set formula. It used to be 3 to 3.5 times annual profit, but few in our space are getting that anymore.
What it depends on is whether the site or company is still growing, what genre they are in, what kind of upside the concept has and many more variables.
And Richard is absolutely right, it comes down to how much someone is willing to pay.
If your company is trending down, don't expect to get a great ratio.
Also keep in mind that at this moment it is a bit of a buyer's market.
Yes, content comes into it with paysites, but I don't think it's near as important as it used to be. Buyers are sometimes paying a fraction of the value of the content if the site or sites are trending downward and not making money.
The first question I ask a prospective buyer is "are you profitable". Because if you're not, it suddenly becomes a very hard sell.
If you are even thinking of selling and have any questions, please hit me up at bpf at adultsitebroker dot com. I'm always glad to speak to anyone about their company and the best way to potentially move it.
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3 to 3.5x annual profit?
If the concept has an upside? If the company is already selling its product it is no longer a concept.
Depending on their genre? Do you mean niche?
Are you profitable is such a generic question. What if they are break even +$1? You should be asking about EBIDTA, not if they're profitable. Not that it even matters... something should be selling based on the numbers and not how good of a used car salesman you are.
Edit: "Buyers are sometimes paying a fraction of the value of the content if the site or sites are trending downward and not making money." ... 9/10ths is a fraction. Do you mean a tiny fraction?
You just talked a lot and said nothing.