Today I sat down with Blake Hutchison, the CEO of Flippa, to better understand how to determine the value of blogging businesses.
Flippa is the #1 marketplace online business for sale marketplace. This includes websites, online businesses, and apps. With over 3 million buyers and sellers on the platform, users discuss and negotiate deals, and buy and sell digital assets.
One of the main types of websites that they sell are “content/advertising” properties – aka money-making blogs.
In my interview with Blake, we discuss how blogs are valued, what makes them valuable, blog monetization, and what you should do if you’re looking to increase the value of your blogging business.
Adam’s Interview with Blake Hutchison, CEO of Flippa
Adam: Thanks for your time Blake. First off, how many blogs sell each month on Flippa?
Blake: A lot. We sell lower-value “blogs in a box” for beginners and higher-value blogs for those looking for something more established.
The number varies but we sell between 500-750 blogs each month.
This month the highest value blog was a political news site with a sale price of $300,000. The site was making nearly $8k per month at its peak and was attractive for its strong authority score, topical content, and big email list. With over 8,000 buyer views, it sold pretty quickly.
Adam: How is the valuation determined for a blog?
Blake: There are a lot of factors influencing the price. Five are probably the most important.
There’s age. Blogs aged over two years are considered less risky. They are easier to assess and historical trends set a pattern of performance.
Next is the financials. Blogs, like other digital assets, are assessed on financial performance. The more consistent the performance and the better the net profit, the better the multiple.
Traffic is another indicator. Sites with strong organic traffic and a healthy database of regular repeat readers will be valued higher than something that is less organic.
Additionally, most buyers will take the Domain Authority (DA) into consideration. You can view this with an SEO tool like SEMrush. To make it easy, we connect Flippa to SEMrush data when you list.
Adam: What about future indicators of performance? Like if a blog is growing or its growth is flat?
Blake: Yep, growth trends are really important. Sites that are stable and growing are coveted most. It sounds counterintuitive but hockey stick-type growth in small business sales can be a bit of a red flag. It’s unlikely that this growth is sustainable, so it becomes contentious.
In this case, a buyer is more likely to consider an average. And, blogs that are declining are penalized from a valuation point-of-view.
Adam: what about the actual valuation and sales multiples?
Blake: Buyers typically look at historical Flippa sales to get a sense of how much a site should be valued, so that drives market expectations. At the time of this interview, blogs over $100,000 in value are selling for an average of 2.53x their annual net profit.
So a blog making $1,000 per month in profit (not revenue, this is after expenses) could sell for around $30,000.
The best way to determine valuation is by using the Flippa valuation tool. It takes into consideration historical sales data and all of the elements listed above.
Adam: One question I get asked a lot is “what should my niche be.” What are some popular blog niches being sold on Flippa?
Blake: There have been over 10 million keyword searches on Flippa, so we have a lot of data on this.
I see a lot of demand for blogs in health and wellness, cooking, technology, and finance. This seems to be a reflection of customer demand. These are popular markets and have a lot of customers to appeal to.
Adam: Based on all of the factors you shared for determining the value of a blog, can personal brand bloggers sell domain names with their own names if they ever want to exit?
Yes, I should also clarify this point. The domain (or brand) can be important in determining value, but only if it’s good (short, memorable, simple) or recognizable. And a bad one won’t detract from value so long as the rest of the asset is in a strong position financially.
Domain Authority is certainly important but that’s more about links from reputable sources vs. the actual domain quality.
In short, absolutely – a personal brand blogger can sell their blog. It comes down to how inextricably connected they are to the day-to-day running of the site, the acquisition of customers, and the credibility of the site.
Adam: So what should bloggers focus on to increase the value of their blogs?
Blake: First, establish a strong content presence and optimize revenue earning opportunities. This sounds over-simplified, but it’s critical.
Buyers are looking for blogs that are already generating substantial traffic and that have at least one, but hopefully multiple sources of revenue.
Adam: What forms of blog monetization are most valuable?
Blake: This can be considered a bit debatable. It depends on your blog and content direction but certainly Adsense (advertising) and Amazon Associates (affiliate) powered sites are most in demand. People are looking for consistent and passive forms of revenue like ads and affiliate revenue.
Adam: What is the actual process of selling a website like?
Blake: Selling a website is truly an all-consuming process. Good blogs can receive a lot of interest, so first, prepare yourself emotionally for the process.
Once you’ve decided you’re ready to sell, you should first determine the value of the blog and what you’re willing to sell it for. Again, the easiest way to do that is with the Flippa valuation tool.
Next, you’ll want to prepare your financials. You’ll need to have your revenue and cost details handy. For more established blogs, profit & loss statements are required.
Then you build a listing. Much like listing a rental property, you need your listing to appeal to the most people. Use high-quality photos and try to use effective sales copy to make your blog listing as impressive as possible.
Once your listing is up, you just have to talk with buyers and negotiate. Flippa has the world’s largest database of buyers so you’ll be matched to the right people. Buyer engagement and getting back to people in a fast, constructive way is crucial.
Finally, you have to be reasonable with your valuation. While your online business is like your baby, it’s not someone else’s. Your selling price should be based on market value and you need to be reasonable like with any other type of sale.
That concludes my interview with Blake Hutchison, CEO of Flippa.
He had a lot of interesting and insightful points about buying and selling blogging businesses. After giving our conversation some thought, here are some of my top takeaways:
Fro my experience, niche selection is the #1 roadblock that bloggers face, hands down. I could write an entire novel about why traditional niche advice is outdated and wrong.
The niche doesn’t matter – starting matters. Getting to monetization matters. Giving yourself the freedom to pivot matters. Most bloggers fail to get there because they go with a narrow niche and quit when it’s not working. Success comes from not quitting. And not quitting comes from giving yourself the ability to pivot your niche when things aren’t working.
As Blake said, there are a lot of customers to appeal to. Focus on building your personal brand around what YOU want to write about and YOUR expertise. There are plenty of niches that make money.
Don’t get stuck at choosing the “perfect niche” – it doesn’t exist. Build a brand around YOU. That’s a niche to get excited about.
Good blogs receive buyer interest:
It’s definitely true that good blogs receive a lot of interest. I get a few emails every week asking if I’m interested in selling my blog. And with revenue of over $80k per month (and Blake’s average of 2.53x annual net profit, I could potentially sell my blog for a few million.
But my blog is an extension of my personal brand – it’s a digital resume, a launching off point, an investment that keeps growing over time. If you want to sell your blog in the future, know that you still CAN do it with your own name as your domain name.
As Blake said, it’s about age, growth, traffic, financials, and Domain Authority, – real business metrics, not the domain name.
The best forms of monetization:
Buyers want sites generating consistent and stable revenue. The most consistent and steady types of passive income that blogs generate are ad revenue and affiliate income.
Ad revenue directly correlates to traffic levels and niche value. So as long as a website continue to maintain traffic levels, ad revenue holds steady.
Affiliate marketing revenue is also passive, consistent, and based on traffic levels, but not quite as guaranteed as other business models. For example, SaaS companies that sell on Flippa have active and paying subscribers, which are a little more guaranteed – they aren’t affected by fluctuations in search traffic.
Revenue consistency and diversification are key. I’m currently in over 200 affiliate programs and don’t hold all my eggs in one basket. While I have some posts that perform better than others, I don’t rely on a few posts ranking to make money.
Overall, if you’re looking to build a valuable blog, your goal is to build passive income with affiliate marketing and ads.
But in order to get there, you need to build a blog around you, write transactional keyword, pivot, adapt, and keep moving.
What did you think of the interview with Blake? Have you ever thought about selling your blog? What questions do you have about selling your own blog? Let me know in the comments below.