Many of you have watched me build a niche site from scratch – from the inception of the idea, all the way to #1 in Google and earning a very generous passive income of about $700 to $800 per month.
My security guard training niche site has been a great success thus far, and I’m happy to announce that on Monday, exactly 8 months after the site was “born”, I received an email from an investor with an asking price of $10,000.00 to buy the site.
To know that I was able to come up with an idea for a website, and in less than a year receive a 5-figure offer for it is very fulfilling. This just shows you that the more you put out there, the more opportunities will come your way.
My Decision
Immediately, I was excited by the “bright lights” and possibilities that an extra lump sum of $10k could do for myself and my family. Yes – I’ve been earning much more than that each month (see income reports), however I feel that my existing income should not impact my decision whether or not to accept this offer. Even though I am earning quite a bit, a dollar is still a dollar to me, and every little bit helps.
An extra $10k is a significant amount of money that could be used for things like my son’s education, donations, our housing fund, a vacation, etc. – all things that are very important to me.
Now that said, I have to think about my site’s current state, where it’s headed and how much it could earn in the future.
Like I said, the site currently earns about $700 to $800 a month. This means that the site would earn the amount offered to me in about 12.5 to 14 months, or a little over a year.
I did a little bit of research on selling and flipping websites, and typically a site can be sold for a price of about 3 times the reflected annual income, or what it could earn over the span of 3 years.
Some quick math:
$700 per month x 12 months in a year = $8400 per year
$8400 per year x 3 years = $25,200
So, this means that if I were to attempt to sell this website myself, maybe on a site such as Flippa.com or another marketplace, it could potentially sell for at least $25,200. This does not include potential future income, which I’ll get to in a second.
Based on these figures alone, I decided to decline the initial offer, and I think you’d agree with me that this was probably the best move for me at this moment in time. The kickers, I feel, are that:
- I could earn $10k in a little over a year if nothing else was done to the site; and
- I could earn $10k passively on the site, since 0 hours of work are required each month to maintain it.
A couple of interesting questions that came across my mind during this process were:
1. What Is the Future of the Site?
The site is definitely a growing force.
Although it’s already ranking #1 in Google for it’s primary keyword, each month the site has seen more traffic, is generating traffic from more keywords, and is making more money than the last. Plus, with the addition of 39 more State requirement posts that I’ve outsourced (and am already receiving and posting on the site), I should expect all of these numbers to increase over time.
I’m also seeing more and more advertising requests come in, which I have not acted on yet (I’m waiting until the site has all 50 States on it before I roll out the directory), and there are affiliate opportunities that I haven’t taken advantage of yet either.
99% of the income currently generated is from Adsense, so there’s definitely room to explore other avenues of income.
2. How Much WOULD I Accept?
$10k is not enough, but what is?
If I was offered the market rate of $25,200 – would I accept that offer?
I would probably say no because of the fact that the site is growing and that “market rate price” could definitely go up in the future.
What about $40k? $50k? $100k?
At what point does it become a good decision to take an offer?
It’s hard to say, and I don’t have an answer for you right now. What would be your pricepoint?
3. What If Something Happens to My Site?
As it’s smart to think about situations from all different angles, what if I kept the site for now, but then something happens and I lose my ranking in Google. Or, maybe something happens to my Adsense account, or the world no longer needs security guards because there’s a company that builds super-human droids that take care of all security in public places. I don’t know – but something could happen, and if it does I will kick myself for not taking the offer.
But, such is life. We all make decisions every day that affect our future and we can always look back and wish we did something differently.
I’d rather look at the glass as being half full and aim towards a positive outcome, so I’m not going to be afraid and accept an offer just because something could happen. This is, of course, my own opinion on the matter.
Again, these are just some random thoughts that I wanted to share with you, and I’d love to hear your opinion about it.
What would you do in this situation? Was it smart to decline the initial offering? What would be your pricepoint?
Thanks again for all of your support, and I’m glad you’ve been able to follow me from beginning to now with this particular project of mine.
And, as I wrote, it’s not over yet.
Cheers!
p.s. If you get an offer for your website, know that the terms and conditions of the offer are typically confidential. Don’t just write a post about it or share it on Facebook or Twitter without asking permission from the person who made the offer first. I asked, and the investor said it was totally okay as long as I didn’t reveal his or her name. I’ve been so open with this site since the beginning, I just had to share this awesome news with you.
Other Posts in The Niche Site Duel Series
- Niche Site Duel: I’ve Been Challenged, and I Accept! (8/16)
- Niche Site Duel 002: Finding a Profitable Niche – My Process Revealed (8/18)
- Oops. The Niche I Selected is Bad, and Here’s Why (8/20)
- Niche Site Duel 003: How to Setup a Niche Site – Before You Add Content (8/25)
- Niche Site Duel 004: My Content Strategy (9/10)
- Niche Site Duel 005: My Backlinking Boo Boo (9/13)
- Niche Site Duel 006: My Backlinking Strategy (9/14)
- Niche Site Duel 007: Ranking and Traffic (and Earnings!) Update (9/29)
- Niche Site Duel 008: My Monetization Strategy (10/26)
- Niche Site Duel 009: I’m On The First Page of Google! (10/27)
- Niche Site Duel 010: I’m Ranked Number One in Google!! (11/8)
- Niche Site Duel 011: THE Backlinking Strategy That Works (11/10)
- Niche Site Duel 012: An Experiment and Income Update (11/29)
- Niche Site Duel 013: CPA Promotions, Private Advertising, Job Board and Income Report(1/14)
- My 275% Increase in Adsense Revenue (1/26)
- Niche Site Earnings and Directory Listing Update (3/11)
- I Was Just Offered Five Figures For My Niche Site! (5/11)
- Niche Site Update – New Content, Record Earnings, and What’s Next (5/26)
- Niche Site Duel – One Year Later (Earnings and Traffic Update (8/15)
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It depends on what your business plan is. I have declined mid 5 figure offers for some sites, even if that valuation was ok at the time, just because I dont need the cash right away and I know i can passively earn more.
However, now I am buildind niche sites with the goal of selling them at around 1 k each.
Btw, for large transactions, flippa is not the right tool to use. Just contact directly who might be interested. If you know your niche you’ll know whho they are.
Pat, cool post. As a real estate investor who is entering the internet space over the past several years with my focus, the old cash vs cashflow decisions are always fun. To me its always been the proverb of the goose and the golden egg. You can always kill your goose, but the problem is that you always end up needing another one. To keep it, just keeps the eggs flowing, which are always yummy month after month. Eggs are really where I feel wealth is measured as really at end of the day, I dont think people really want more geese….they just want more eggs. To test this, just buy a few geese that dont produce eggs and see how fun those guys are after a few months. Worse…geese that need to be fed a lot to produce no eggs.
So at the end of the day….. geese create eggs… eggs create cashflow…..cashflow is congealed (sorry egg pun) life… and congealed life = freedom.
Keep up the good work Pat!
Pat,
Congratulations! Declining the offer at this stage was definitely a wise decision. This is only one of many to come; I believe that you should continue to develop the site and consider selling at a future date.
Good decision Pat. I would have done the same if i had a good finicial foundation like you have. with building niche sites, i think it is probably good to think longterm.
Hope i will have also just a bit of your success one day
Pat – My last few years of losing home (including rentals) has changed my thinking on risk just a little. So here is viewpoint from someone that is curren
tly fighting fraud in mortgages and foreclosures and living on the edge. (click on name for blogpost)
TURning down the initial offer is part of the negotiations. Hopefully you submitted a counter offer they will accept. Personally, I would sell at 12-17K and if here is why:
1.Economy – everything is in flux no matter what the economists say. Dollar is devaluing and the feds are printing money to cover debt (i don’t do much on my second blog America’s Economy and really should blog about the devaluing of dollar).
2. Economy – I would use opportunity to branch out just a little. Buy real gold if possible or something that will increase in value
3. Save some to build additional niche sites. YOu might even be able to compete against yourself, unless it is in the contract that you cannot build a similar or ‘go along’ site.
4. Maria makes good point about age of website – you might want to build several more domains or buy something that is lower value and revamp it totally and get it simliar to the “sec. guard” site.
5. 15,000 would be great price but realisitically all values have to be based on the annual NOW not annual later – And later that 20K might be in actual dollar value only worth 10K
6. Tax impact. Unless you have a trust or something set up now – your dollar coming is actually worth less. If you are wanting money for son’s college it makes sense to set up trust fast so that if you do sell you can maximize the dollar coming in. You probably would want to be absolutely clear on what your plan is with the money…. In less than 1 year you might be wishing that you had every cent available just for survival. With election year coming up stability is something to be looked at.
So waiting just a little makes sense, so that you have a firm plan for what to do when the decision to sell does make sense – to you.
With Consumer buying changes, internet changes, monetary changes in current economy – I’d try to get as much as I can NOW, and I would try to set up to receive it tax free.
Thanks for you sharing this with us, it inspires to build similar sites, because if you have a goal of selling it we know it can be done in the same time you have used.
Pat, given your track record I’m rather surprised that some people have suggested that if Google altered their algorithm, then you would just roll over and die. I believe, that until recently, you had only added details for about 13 States. When you have details for all 50 States, your Adsense revenue will increase to perhaps $20k per year and that’s without taking into account other opportunities such as your directory and direct advertising.
By the way, have you thought about the rest of the world? You SGTHQ is number 8 on Google.co.uk for the term “security guard training”. I would be interested in the SGTHQ European franchise!
So, in my eyes, you have only scratched the surface of the opportunities. In addition, none of the above takes into account the marketing benefit of SGTHQ to the brand that is Pat Flynn. I believe you owe it to yourself and your legions of followers to see just how far you can take you niche site challenge.
I would have made the same decision Pat. Personally I would sell the site for 20K. I would then use that money to invest in another one of my businesses (or a new one) which could easily make up for the $800/month lost income in a matter of 6 months or so.
You did the right thing. 10k is not much.
If you don’t need the sum of money now why would you sell your investment?
The real question is:
*Could you take that 10k and make more money faster with something else?
Like you said, the site will only generate more traffic and sales.
I would at least hold on to it until it’s where you want it to be (sounds like you’re adding a lot now) and then go from there.
Good luck!
I think you did the right thing as well. However, you did omit another risk, that you may want to consider going forward: what if AdSense bans you for some reason, and you need to go with different affiliate marketing companies?
Pat,
You need to conduct a discounted cash flow (DCF) analysis which takes the future cash flows of the site along with a growth rate and appropriate discount rate to provide a realistic number for comparison. I will try to email you an easy to use spreadsheet since I can’t attach it here. You can also Google “discounted cash flow” for more info. This is the valuation technique used by many private equity and venture capitalists folks.
The key word to remember is PASSIVE. If you sell you would not have any Passive Income!.
good luck
Awesome news Pat! Wow that must have felt great. Thats quite an accomplishment and I hope you take some time to enjoy your success.
Thanks for your blog & inspiration & motivation!
Great decision on not selling your niche site…once you sell it it’s not passive, nuff sed!
I agree on not selling. That site could earn you thousands every year for years to come – and even better can become a platform for launching a new training program that could earn you tens or even hundreds of thousands.
Did you build the site to sell it off or for, as you represent, a stream of continuing passive income? You say you make almost that a year, so why sell? Also, it would appear that with the growth of the net and specific interest you will continue to grow the site. Surely that’s what the investor is considering in tendering an offer. You were right to hold on. Should it all go south by some weird turn of events, you’ve lost nothing. Unless, of course, you’re just tired of dealing with it.
Thanks Pat, for the email alerting me to this post. I think you did the correct thing – your skill in building not just the site in question but your business in general shows that you have a special touch. That touch, plus your growing experience, should only help you increase the value of all your business interests. Good luck from bonnie Scotland – miles outside your timezone, but well in touch with your brainzone!
Joe
Like the two gentlemen, I think that you did the right thing by not selling. Who knows what the potential income would still amount to in future. I like the point you made about website flipping. I know of people making their living do just that. Thanks for sharing with us
Jaques
Hi Pat Congratulation for your first offer i hope you get what you want from this website and i want to ask you about how to earn from Ehow i tried but actually i cant
This is a fantastic read Pat. 10k was a decent offer but i would be going back with a counter off. 20k for me would be an acceptable figure to accept but i guess our situations are different. I am not currently earnining 39k worth of clear profit from other passive income streams so i guess you can afford to risk this and keep the site.
Upon reading this you have got me thinking about my own niche site and going by your figures its worth at least 11k (taking into account 3x the value). I am in a different situation to you as I have a full time job and my passive income work is secondary to my job so I would probably take an offer of 11k for my website.
I think those who have said ‘take the money’ need to realise that you are a different breed to the rest of us. You have a huge monthly income which can facilitate further projects. Furthermore you have just shelled out near 10% of the offered figure for further content writing. With all that in the mix is it really worth selling?
I don’t think so.
Ok, gotta be honest, I can’t even comprehend selling AT ALL! I respect your decision, I would’ve done the same (if I was in your position). You make more than that every month, so you’re not hurting for money right now. As far as I’m concerned, any business that’s set up and earning a passive income…you keep. NO questions asked. Because if you BARELY lift a finger to generate that income, what’s the point of selling? Even if they offered 40K, you’re going to make that moreover eventually (without lifting a finger). Also, I believe a sustainable income is waaaaay more comforting than a lump sum, anyday. If one day you just up and decide you can’t/won’t do this internet thing anymore, you’ll still have streams of income on a regular basis. If you sold it, that’s just one less piece of income.
I say keep the site (forever) and continue to create more (and keep those forever). Unless Google or one of these other gimungus companies come calling, I don’t see a point in selling.
I disagree. At some point, the selling price may be too good to pass up. $40K is NOT guaranteed.
Who’s to say that google won’t change their algorithm again tomorrow and bump Pat’s site off of the front page of google?
Niche sites and the search engine positions are very dynamic and ever changing. If you put no more effort into backlinks, eventually you very well might slip out of the first spot – which could result in a huge hit to earnings.
I’m not saying he should sell. But at some point, an offer could be too good to pass up.
Pat, this is my first opportunity to thank you for all you do for us guys and gals, most of whom you will never meet. The niche site duel has been just what I needed to get off my rear end and start moving forward in a new area to improve my life and my family. Your openness and willingness to give is why you are so successful. Keep doing what you’re doing!
I agree with Mike that there may come a point when you get an offer too good to refuse. However, don’t let the fear of what might happen with Google (or with any force you have no control over) be your motivation to act or not act.
I recommend you follow through with your plans to include info for all 50 states and to further monetize the site outside of Adsense sales. Watch what happens to your revenues after 3-6 months. And if you are interested in selling after that, then entertain any fair offers based on those numbers. One word of advice: never accept the initial offer; it is set to open the door for negotiation. Always, Always submit a counter-offer.
All the best, and keep us posted on how things are going with the site.
Thanks Henry (and everyone else) for your insight and thoughts. It’s definitely great to see such a supportive community here. I love it!
Great advice Henry, I’ll definitely remember that, for sure, and you can be sure I’ll keep you all updated. Cheers!
Hi Pat
This is a most interesting read. I was contacted by a business broker to purchase my online/offline business a couple of years ago, but I didn’t even ask the price, because my business wasn’t for sale. If I had asked the price, I too would’ve had a bigger dilemma, but I love my business and didn’t want to give all this away. Times have been tough, but I think that that makes you dig in deeper and look at what values you place on your business and how you approach it all. To pick my business up again, I’ve done a lot more work on the internet and will continue to do more of this.
Why give away a perfectly good passive business Pat for just a few $$ when over a 5-10 year period, this could expand and make you a lot more. Besides, by offering a directory, you’ve obviously got more ideas and ways to keep on growing your bases and you haven’t lost interest. Good on you for sticking to your guns, but thank you for sharing your thoughts for us to read and chew over. It’s much appreciated.
Nice work Pat,
Maybe it’s like my granddad told me years ago, “All property is for sale if the price is right.” What is the right price? Only you know.
WOW, that is so cool…this is the kicker thats going to get me off my duff and seriously get into this way of making a living. Its kind of my best way to make a living as I need to return to my country of orgin Canada, and I am “no skilled” there for any kind of profesional work(really). Its funny,cause one job I could get, is the security guard job(which is a minimum wage job by the way in Canada.(11.00 dollars an hour but rent is like 800 for a bachelor apt i think). Anywho…working as an “English teacher”(said in quotes, cause almost anyone can be a teacher in Japan, as long as you got some kind of college diploma, doesnt have to be in Teaching or Linguistics or Education…but it would be nice)…ANYHOW!!!…For me to return to Canada…Ive been out of the country for like 10 years and well need a way to make a living that would be a self-employment option and I need a way that would be great if I could do it from Japan and just continue doing it back in Canada….answer…smart passive income or affiliate marketing or niche site building/blogging….its the perfect answer for a bloke like me whos been so out of it….i thought about….i read stuff here and there…but havent acted on it much…..this “offer” post…its the kicker….proves beyond any doubt that a living can be made(besides your already monthly and yearly reports…which should be enough on its own)….anywho….thanks for SHARING and being so TRANSPARENT….and I especially like that at the end of the post you…stated that you asked permission to the offerer if you could talk about it.(staying moral and above board is the best way to go, this internet thingy can have a tendency to well make one think you need to pull the wool over folks eyes or not be open…well i get that feeling sometimes….anywho…thanks for showing that honesty and doing things the right way is the right way to do things).’nuff said spi-dey fans?
I would have sold it.
You’re in a niche where your going to build and forget which means after time it will loose its ranked because it wasn’t updated.
There are millions of people who every day try to build websites/niches what if someone tries to compete with you who has more knowledge or a bigger budget and kicks off first place on Google? You will no longer be making $700 a month how are you going to sell it then.
I would have used that $10, 000 and build more sites and sell them, the same way you build the security site you can build more.
Pat,
Congrats on your brand spanking new success.
Here is my take…
The power of delayed gratification my friend…
If a man is willing to pay you 10 grand today, what will he be willing to pay tomorrow if you tell them your stuff is not for sale…
Perhaps you should continue to feed it more compelling content, links, and more subscriber’s…
Perhaps you should cash in and start a new profit pulling project.
The truth is…
We all want what we don’t have…
But when a man(or Woman) is in a position of power(or resources) is told what he can’t have…He will dive through fire to get it.
If you sell it good on you…
If you hold on to you, that’s cool too…
Looking forward to seeing what you decide to do either way.
Until then…
Keep cranking out the compelling, link-worthy content
“what if…the world no longer needs security guards because there’s a company that builds super-human droids that take care of all security in public places.”
Pat, if this happens, the last of your worries will be the extra $10k this site could have brought. I’d say in this scenario, we’re roughly 3-5 years away from Judgment Day when machines take over the earth. God help us all…
But seriously, I think you made the right call to hold off. Keep packing the site with more and more value and you’ll get a much better offer down the road.
Oh man – that was awesome, lol. Thanks Ben.
I’ll keep at it, and I think the site will deserve a design overhaul as well in the future once all of the content is up. What do you think?
Hi Pat,
I have read your whole post but have not had time to read everyone else’s replies so forgive me if this is a repeat of things other people have said. Here’s my analysis from buying and selling, and establishing and selling, several bricks-and-mortar (B&M) business in Australia, and now into internet marketing (hence my passsion for following your site – I think that what you do is fantastic!). PLus I’ve been watching Flippa sales for the last 6 months (maybe do some comparisons there too).
For B&M, the asking price is usually two-and-a-half to three times annual net profit, which makes your asking price $25,000 to $30,000. Given that there are way less ‘management’ issues with your website than with a B&M business, plus the potential to drive much greater profits from your site, that figure seems way too low. I’d say $50,000 is not unreasonable. However, I should temper this with the fact that I am Australian and our economy is white hot at the moment, and so I come from a perspective of greater business wealth. That being said, the internet is global and someone from another country could see the potential for your site, but it, monetise it a bit more, and resell for much more. I say emphasitically don’t sell. Complete the planned updates, and let it sit for a while, then if you want put it up for auction. Even then you don’t have to sell if you don’t get a good price.
Cheers, Pippa
PS And also, your site is called ‘Smart Passive Income’ – if you sell it, you no longer have passive cashflow from it, and isn’t that your goal?
How exciting Pat, this offer has given you an opportunity to assess the direction of your niche site and this week you probably considered some things you hadn’t thought about previously. If you have the time to continue to work on your site and grow it, then I think you should keep it, unless you receive an offer that also provides you with a piece of the pie (ie. partnership) so you continue to reap the rewards plus receive a lump sum – best of both worlds
You don’t say how much work it takes to maintain and how much work it will take to build.
The other thing to consider is if you could take the 10K and multiply it faster in another way – say by starting 10 sites and telling people what to do that you know how to do.
And you could decide that you just need a holiday and this chunk of funds would best be spent buying you some time off to spend with loved ones and doing nothing at all.
I would have rejected the offer without thinking for much more than a second. But that’s me.
Pat, I’ve been following your site now for awhile, but have never commented before. Today, though, I just couldn’t resist. I think you DEFINITELY did the right thing, no questions asked. My main reason is simple and was stated by some of the others – this is a source of “residual” income to you, and we all know that – unlike ‘linear’ income – residual income is based on the law of diminishing effort. So, bottom line, I would think long and hard before I’d ever sell for this one reason alone. There are more, but this one is the biggy for me!
Congrats Pat. Good decision. And may I mention that that niche site is still a lab for this site and largely responsible for the rapid growth of your community. We are still learning from it.
Hi Pat,
I really appreciate your works and how you do it publicly. Just to let you know, do I didn’t participate that much in the community, I read your great emails(very helpful in my journey online). Thanks for being Generous to everyone!
For me is to say YES you did a great decision though, I haven’t in that experience yet, but judging how you think of the future, you really know the risks and disadvantages! And I know everyone will agree, we’ve learned a lot on this decision you’ve made publicly Pat!!
In my opinion, why it’s RIGHT because.,whatever happens to your site(outranked, crashed,etc..), you already knew how to restore it(another effort though)…and the other thing is.,you can think of many things you can add in the future that this site will profit more than that 5 fig offer!!
.
Can’t think of anything but agreeing with YOU..hahaha.. Nice one Pat! Thanks a Million!
–
Clint
That’s great Pat, way to build an asset! I actually think the offer is a fairly good one. I would not pay 3 times earnings for something whose sole source of income is organic search traffic. Didn’t many sites just loose their ranking in the Google “Farmers Update?” I think he was counting on growing the revenue like building a list. Does the site have a list from a lead capture that goes with the sale? For that I could see paying a 3.0 multiple of earnings. Cheers!
There is a list to go along with it, and the site did survive the Panda update, primarily because the content is not farmed content, it’s 100% unique and from me and my research.
Congratulations Pat. I really appreciate your play-by-play presentation here. I agree with your decision to hold off selling the website, at least for now. I’m sure the person who made the offer did the same calculations you did and was either just testing you, or making a opening bid to begin a conversation about selling. I bet you’ll be hearing back from him, and others, with a much better offer later. Thanks for the inspiration you give me. Off to do some Market Samurai analysis…!
Hey Pat,
Congrats on receiving the offer. I agree with you that it was too low. Was it an all cash offer, or was there terms to it? If it were me, the terms would definitely have an impact on what I sold for. For example, I sold my last company for $1.2M, but it wasn’t worth that much. The reason I got that price was that I was willing to take 25% down and then carry a note (with 10% interest) for the balance.
I’m not too sure that I’d be willing to do that with a website though..unless it was coming from a very credible buyer.
I really liked how you shared your thought process on the blog. Bravo. Your transparency inspires me to do the same.
Cheers,
Trent
Thanks again for being an inspiration to all of us out here. With regards to the offer, would you then consider selling let’s say 25% ownership for $10K? That way you can re invest some of the money to improve the website.
Wow…I will sell it if I were you because that is a lot of money
hello dude I’m not agreeing to this idea. because the site is growing and growing.. So If he sells this site now for that amount. he will get only that amount. But how much will he earn if he keeps this site? SO this idea is quiet bad.
Follow me on twitter
Great news Pat, Congrats!
Plus it must be highly motivating…to make it even better
It’s great news. The offer would be higher or not in future. At this moment site is profitable but it could be more profitable if you make multimedia materials to sell – it’s safety way to earning. Google #1 position it’s your primary way of income but it’s unsafe.
I’m delighted you didn’t sell Pat! Way under priced at that level. On decision making, my personal philosophy is that I don’t think anyone should beat themselves up about decisions they make because all anyone can ever do is make the best decision they can with the information that is to hand.
To answer the question on how much I’d sell the site for, I’d ask a question in return…how much is it going to cost to educate your son? Take that number and multiply it by the # of years and an approx rate of inflation. The number that comes out would be my answer.
Until someone was prepared to pay me that much I would just keep working the site and testing new layouts, positioning of ads and especially different monetization strategies.
Really with everything I think goals are crucial…
Thanks for another really engaging post
Congratulations Pat!
I’ve been following the niche site challenge series with keen interest, and it has been very informative and educational – I’ve learned a lot. It’s great to see that not only is there a light at the end of the tunnel, so to speak, but the light keeps getting brighter.
I think you were very smart to decline this initial offer. Your assessment of the site’s true worth, based on current age and income, is much closer to it’s actual value than what you were offered. Plus, “knowing” you as I do from reading your blog, it’s going to keep going up in both income and value.
Again, congratulations – it’s nice to see that nice guys don’t always finish last!
Wow that’s amazing Pat!
I just recently started following your blog and went through the whole “Start here” page. Went through it all and learned a ton!
Just wanted to say thanks for all that free value packed info you’re putting out here.
As to your decision of declining the offer.
There’s still loads of potential in it and I wouldn’t know what I’ll do “if someone made me an offer I couldn’t refuse”.
I believe that was the right choice!
I guess the price-point would at least be the potential earning of the site for the next 5-8 years.
Pat, I love receiving emails from you with this kind of information. Congrats.
Info like this and your earnings reports keeps me fired up and charging on.
Don’t let up, keep them coming!
Bovic
It is always nice to get those types of offers. It’s kinda like getting a prize for your efforts. Congrats…..
Hey Pat, just read your post. Good for you, but I don’t think it’s a bad offer. If you actually look at Flippa most sites go for around 10 months income or they don’t get sold.
That being said-it doesn’t take any time to maintain it so I would’ve held on to it too. I think it’s unlikely that you will get a 20k offer though. If you spend some time on Flippa and take a look at what sites produce income wise versus what people will actually pay-it’s not 3 years of income. I would hold on to it forever unless it gets burdensome or your want the capital for something else.
Why I’d Sell:
1. Niche sites can be finicky, especially if you’re relying on Google for traffic… You can be #1 one day and not listed the next.
2. Everybody knows your niche and your competition is likely to increase because of that.
3. The money right now is guaranteed, the future health and income of the site is not.
4. You’ll have more time for other, more enjoyable, pursuits.
5. You can leverage the sale/experience to create something bigger and even more profitable, like a “How to Sell Your Niche Site for $10,000″ class.
Why I’d Keep It:
1. Because this is a real site (as opposed to some type of “auto-blog” or scraped site), you’re probably ok with Google.
2. If it continues to work at this level, you’ll make more money in the long run.
3. Everything is outsourced (I think), so it’s not that much of a time commitment. Plus, you’re providing a job for somebody.
4. Diversity in your “income portfolio” will give you peace of mind.
David thats some fantastic advice.
I am with you on the leverage through sales experience. It would make a fantastic workshop ‘How to sell your niche site for xxxx’ and i think Pat would benefit from that. Furthermore he would have money now to save. Saying that 10k is not enough and he can pretty much earn that in 18 months of work so I wouldn’t sell it for that amount.
You have however summed up every single option great.
Nice breakdown, David.
Another reason to keep the site is that the heavy lifting has been done already. Building a site from scratch is like pushing a car out of a ditch…getting it moving is the hardest part and keeping it moving is much easier.
Going from $0/mth to $500/mth is a lot of pushing. Doubling it to $1,000/mth is much easier. So is doubling it again.
I would build it until you hit a real plateau and then sell. Reinvest the money in another (QUALITY–not cheap non-english speaking writers) outsourced site and rinse and repeat.
Web properties are no joke, they’re an asset like any offline asset worth money. I made a crucial mistake last year selling a series of sites for what I thought was decent money, and regret it tooth and nail.
Not a day goes by, I don’t regret my decision. Because what I sold was…time. My sites were established and high ranking sites which we all know take time to develop. The new owners bought time and lots of it.
I sold one property way too early and lost out big time. I sold it at Christmas time 2009 for a paltry $2,000 and the new owner turned around and flipped it for $16,000 in April 2010. Obviously I made a BIG MISTAKE. It’s a long story, if you want to read about it more, here’s a link to the whole ordeal.
http://www.flipwebsites.com/selling-websites/the-16000-mistake-lessons-learned-from-a-successful-website-flipper
Needless to say I don’t plan on selling any more of my sites anytime soon, and surely not for too low a sum.
You did right in (((not selling))) and you pretty much mentioned the reasons why in your article. I agree 1000%.
Hi Pat,
I think with the site, the juice was in creating it from scratch and watch it grow. That site was in some manner a growth of you as well. The person who made the offer didn’t understand that or your passion, or as someone said earlier, the buyer could have been just testing you. All things said and done, its nice to know that you have built an asset that marketable.
Again, sites are like babies. When you have completed your input on them…. you will be willing to let them go. Till then plod on with your creations
On a separate note, your communication style is fantastic. Its frank and upfront!!! Its is a skill you can teach(and I`m sure many would be lining up to learn) as well. Keep it up!!
Will be following your progress. All the best
Pat, you made the right decision, the site is worth a least 4 to 5 times more than that. But that’s what investors do, they try to find cheap assets. You have the natural gift of SEO, not many people have it, but some do and you are one of them. keep the donations going because that’s a big part of success.
I totally agree with your choice. The amount of time you put into the website so far is probably worth more than $10K. Plus, you probably generate a lot of traffic from people that are watching that website grow. Not only could you make that money in a year, the intangible amount far surpasses $10K.
Congrats on the offer!
It’s hard to estimate the value of a site. Especially if you are writing for a non-USA market things get more complicated. With my flemish site, I have a ‘market’ of 6 million people of which +- 20.000 / month are searching for the information I write.
I think if my site would get 20.000 visitors / month, I would have an earning potential of 300 euro / month, but I think my site would be worth more than (300x12x3) 10.800 euros since the market is VERY competitive for my main keyword ‘EPC’. In this small market there are about 3000 sites competing for the same keyword
Where did you get 3 years income from? I thought that typical selling price was 10x monthly revenue.
As for the money, $10K doesn’t seem like a lot for a guy at your level. DO you have other projects you could invest it into that would start generating even greater monthly income in the next 12 month? Putting that $10K into a vacation or house won’t earn you as much as it is in its current form (the security guard site) so I wouldnt sell based on that reason alone. If you have another project/site that you needed $10K to get started, with greater returns then your security guard site, I would sell and use the funds to jump to the next level.
Agree. There’s another aspect to think about too – lots of people have refused to sell sites, and then found that their site got tanked by one of G’s algo updates. Far from having three years income in the bag, they had maybe three months and would have been better off cashing in and selling the site, and passing the G algo risk to the buyer.
Pat, thank you for this post. It inspired to take action on setting up my own niche site. Specifically, I have done the following
- applied for a Google AdSense account (wonder how long this will take)
- registered the domain for my niche site
- ordered 25 articles for the niche site (5 articles for the site itself and 20 articles for backlinking).
Thanks for continuing to share your journey with us all and walking us through your thoughts and decisions.
DECLINE.
That site is very valuable because the income it generates requires no additional work AND it could be improved upon to an even greater extent. You built a site that is exactly what an investor is looking for.
I would seriously consider an offer of $35,000 in it’s current state given that it generates a healthy income with zero work and it can be vastly expanded upon.
Hi pat. I definitely agree that you declined the offer. Since the site are getting $700 – $800 per month, this can get more than that with your existing efforts. Let’s say you accept the offer, the $10,000 offer now is high but its soon be gone. If you decided to sell your site in the future, I am sure you can get much more than $10,000.
I would sell the site for 30k and start a new niche site with the money from selling
Now that you know it is a profitable niche and know how much you need to do work to achieve first page results it’s easy to calculate ROI if you outsource the new site building.
$10,000 is really low – I’d happily give you $20,000.
Great decision unless they increase their buying price. Thanks anyway for sharing. You just motivate a lot of people to attempt because there is always a future with hard work.
I get offers for my website quite often – at least 4 times a year. But no one has ever said how much they’d buy it for lol.
(I wouldn’t sell anyway – I think it’s nuts to sell something that’s doing well, unless you need the money to do something else.)
Hey Pat,
Just a quick question here. When I do a search for your keyword (Security Guard Training), I notice that Google includes “site links” in the search…is there any tips for getting site links included in the SERPs?
Hey Tipjar, I get this question a lot as well. Site Links are manually determined by humans at Google. Your best chances to make your site appealing to Google editors is to pay close attention to structure. For instance, your about page URL should be /about instead of about.php
Once they do throw you Site Links, you can edit how they appear via your Google Webmaster panel.
HI Pat,
Is it possible to know all the sites you currently update? Just hoping
Hey, You said that all sites got #1 in main keyword. How are you getting backlinks? Are you using any tool or oursourcing ?
Best Regards & Congrats your success,
Pat – definitely a good call on your part. I recently turned down 200k for one of my website properties – an offer which was more than the typical 3x annual revenue guideline you often read about. I turned it down for much the same reasons for you, but also for a less tangible one – I enjoy having ownership of the website. I enjoy producing content for it, and I enjoy developing it. Some day I’ll sell. But not today.
well frind,if you don’t mind,i am using ,wanna to know that.can you please tell the way how to inprove my traffic on my blog although i am currently pursuing my mba,but very keen to continue my blogging inspite of lack of time,bt ver much interested to learn morefrom your bro,please help me to explane each & everything related with blogging,how to generate my income,everything related with business promotion ,can you help me out..
waiting fr you reply
bye & t.c
well frind,if you don’t mind,i am using ,wanna to know that.can you please tell the way how to inprove my traffic on my blog although i am currently pursuing my mba,but very keen to continue my blogging inspite of lack of time,bt ver much interested to learn morefrom your bro,please help me to explane each & everything related with blogging,how to generate my income,everything related with business promotion ,can you help me out..
waiting fr you reply
bye & t.c
Wow…I wonder how many people actually are making a pretty good living “flipping websites” the same way that people used to “flip” houses before the market fell back in 2008? That might be a good topic for someone in the make-money-online niche to cover.
Do not money to buy a building? Worry not, just because that is real to get the loan to resolve all the problems. Hence get a term loan to buy everything you want.
if was offered something like this,i will not accept at all.
This truly is a blessing to read. I envision the opportunity to be in a niche based upon the inspiration from your work and your words. I’m thankful for every blog post you create an look forward to each new post, podcast and site revenue update.
I wish you continued success and I look forward to inspiring others one day too as you have done me.
God Bless!
I like your way of thinking Pat and I like reading your thoughts.
I probably had taken the same decision as you. If i manage to achieve a result than the one you achieved through this site that means that I deal very well with the internet marketing and smart passive income approach so why not continuing working on what I built instead of selling it.
Thank you for sharing
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