Feedback Form
Home Features Mastermind Forums About Advertise Blog Network Contact Be An Author

The $100,000 Question

The $100,000 Question

"So, what do you think my web-based business worth?", someone recently asked me. I questioned them about previous year’s income, expenses, traffic, page rank, and the amount of effort they put into the business.

After listening to their answer, I realized that fifty people when asked this same question, will probably provide fifty different answers, and that all of these answers are likely wrong.

What does matter is what someone is willing to pay for it.

When selling a house, for example, real estate appraisers start by looking at comparable sales in the neighborhood and adjusting the value based on the positives and negatives the home has. The number they arrive at is a historical value. Lenders require them. Real estate agents love them. Sellers try to optimize them. But the house is only worth what someone is willing to pay for it

Business brokers will likewise place a value on a business based on historical earnings (which don’t guarantee future earnings), potential for growth, market niche, etc. But again, the value of the business is in the eye of the purchaser. Of course, if there are tangible assets in the business, those can be liquidated for a known value.

For a web-based business, it all comes down to perception . Is the business making money or is it likely to do so? If there’s lots of unique traffic, then there is additional possibility to make money by selling ad space.

The problem in negotiating "worth" is when there’s a discrepancy between the perception of the buyer and the seller. The buyer is looking for flaws to justify a price reduction. The seller highlights the uniqueness to justify a top price. Both want to walk away from the deal feeling like they "won".

Instead of getting caught in the perception game, consider the cost for not buying or not selling. If you’re exhausted running the business, then what’s it worth to you to reduce your stress? How about the late nights worrying about the new competition that’s threatening to overshadow your success? When was the last time you took a vacation?

You might regret the sale or purchase, but if you did your "homework" to verify the "numbers", and you got wise counsel to help with the transition, then everything that happened is investment in your education.

Besides death, taxes, and change, there are no guarantees in life or business.

(Since people love hearing about online businesses that "hit the lottery", read the story about pizza.com selling for $2.6M (http://blog.wired.com/business/2008/04/pizzacom-domain.html) or a story about Fund.com and Harmony.com for $10M (http://www.webpronews.com/topnews/2008/05/12/is-harmonycom-worth-5-million))





The $100000 Question - To learn more about this author, visit Jay Hamilton-Roth's Website.

Like this article? Share it with your friends

Article Feedback
 Article Feedback No article feedback found.
  Leave Your Feedback
article feedback

Article Feedback
Leanne Hoagland-Smith
Are your sales where you want them to be? Will you be one of the few who achieves sales or business success or one of the many who have failed to change? Are you tired of being told you are like everyone else? Then you may find my first book on sales of interest. Be the Red Jacket in the Sea of Gray Suits, The Keys to Unlocking Sales available at Amazon or at http://www.processspecialist.com/red-jacket.htm. This book is a reflection of my no-nonsense approach to improving sales to overall business results. If you are truly committed to making sustainable changes, then I can help you secure a positive return on your investment because I focus on executable solutions not telling you the problems you already know you have. From training to corporate (group) coaching to executive one on one coaching, my approach is to assess, create awareness, build a goal driven action plan and then execute. The bottom line question is "Not do you or your employees know it, but do you or they want to do it?" Please call for a free strategy session at 219.759.5601. - Visit Leanne Hoagland-Smith's Website


To learn more about the Evan Elite Author Program please contact us.

About The Author


Jay Hamilton-Roth
(Visit Jay's Website) Jay Hamilton-Roth founded Many Good Ideas (http://www.ManyGoodIdeas.com) to help small businesses brainstorm, design, and implement effective marketing strategies. He combines creativity with common sense to demystify the process of getting great results. He has used his high-tech background from MIT to help him launch five businesses. He consults with companies in a wide range of industries and publishes a monthly marketing newsletter and daily marketing blog (http://ask.ManyGoodIdeas.com). He is the host of the new TV series "Business With Passion" (http://TV.ManyGoodIdeas.com).

Jay Hamilton-Roth is a Platinum author on EvanCarmichael.com
About The Author

View Author Blog
View Author Blog

View Author Video
View Author Video

Free Downloads


Jay Hamilton-Roth's

Complete
List Of
Small-Business-Consulting
Articles

Name
Email
If you enjoyed this article, get Jay Hamilton-Roth's Complete List of Small-Business-Consulting Articles For FREE!

More Jay Hamilton-Roth
Make Your Marketing Personal
Book Review Ogilvy on Advertising
Psst Do You Know Whos Talking About You
Book Review Made to Stick
Are You Selling or Consulting
How To Pitch Your Business
Unscrewed The Consumers Guide To Getting What You Paid For
What Are You Really Buying
Marketing Secrets Of A Mail Order Maverick
Book Review Branding Only Works On Cattle
Free Downloads


 
 
 


Evan Elite Authors
Stephanie Robey  
Staging Diva  
Dave Kurlan  
Evan Elite Authors

Become An Author
Have you written articles that would be of value to entrepreneurs? Become an expert on our site by publishing them! Expose yourself to a wide audience, drive more traffic to your website and get more sales! Click Here for details.
Become An Author

Evan's Latest Video
Modeling the Masters: Learn the true secrets behind Walt Disney's business success factors & grow your company! Video produced by Phanta Media
Evan's Latest Video

Business Opportunities
"Learn straight from Evan how you can Make a Full Time Income (And More) from a Website"

How to Start An Online Business

Click Here To Learn More
Business Opportunities



Evan's Newsletter
Get advice & tips from famous business owners, new articles by entrepreneur experts, my latest website updates, & special sneak peaks at what's to come!
Name:
Email:
Evan`s Newsletter

Free Downloads
Joint Ventures ebook Icon Joint Ventures ebook
Instant Press Release Icon Instant Press Release
TeleSeminar Etiquette Icon TeleSeminar Etiquette
Networking Online Icon Networking Online
Leadership Style Assessment Icon Leadership Style Assessment
Free Downloads - Complete List

Entrepreneur Tools and Guides
The Top 10 ProBlogger Posts - Best Posts for Bloggers
The Top 10 ProBlogger Posts
Best Posts for Bloggers
 
Top 50 Productivity Blogs To Watch In 2009
Top 50 Productivity Blogs
Top Blogs To Watch In 2009
 
Entrepreneur Tools and Guides

SEO For Africa
SEO For Africa
Binta Chukwudi Benin City, Nigeria,
Binta Chukwudi
Benin City, Nigeria
SEO For Africa

If I Were A Startup...
Lisa Shepherd, $335k to $1.1 Mil in 2 years
Lisa Shepherd
$335k to $1.1 Mil in 2 years
Chris Nguyen, 30+ national clients on $0
Chris Nguyen
30+ national clients on $0
If I Were A Startup... - Complete List

Famous Entrepreneurs
Ray Kroc, McDonald's
Ray Kroc
McDonald's
Ty Warner, Beanie Babies
Ty Warner
Beanie Babies
Famous Entrepreneurs - Complete List

Entrepreneur Advice
Jack Canfield, Chicken Soup
Jack Canfield
Chicken Soup
T. Harv Eker, Millionaire Mind
T. Harv Eker
Millionaire Mind
Entrepreneur Advice - Complete List

Popular Articles
(Premium Authors)

     10.5 Things You Must Know When Shopping For Health Insurance
By Kris Willy
     3 Health Insurance Misconceptions
By Kris Willy
     Do you spend more on your vehicle than you do on your body?
By Kris Willy

Have A Suggestion?
Toronto Salsa Classes / Toronto Salsa Lessons Email us your ideas on how to make our website more valuable! Thank you Sharon from Toronto Salsa Lessons / Classes for your suggestions to make the newsletter look like the website and profile younger entrepreneurs like Jennifer Lopez and Sean Combs!
Have A Suggestion?

More Evan Carmichael
More Information