How to Sell Your Blog for a Six-Figure Sum (and Not Leave Money on the Table)
The idea behind starting a blog in hopes of making enough money to quit your day job sounds like a dream too good to be true; however, it is very possible.
Many aspiring entrepreneurs are finding online assets to be the next frontier in the global workforce. Writing content is often a stepping stone for those getting started in the space, and blogging has quickly become a great source of side income for those who jumped on this opportunity early on. Those of you who’ve been blogging for a few years and have begun to see consistent income from your affiliate links or display advertising clicks may be wondering what the next step is.
What usually ends up happening, according to many sellers we’ve spoken with, is that you eventually reach a plateau in your ability to scale the business. You may also feel a loss of interest in the subject you’re blogging about, as many sellers have told us that’s what led them to our platform in the first place. In this case, the best option is to pass on the torch to someone who has the capital and drive to scale the business further than you have the ability or desire to.
Often, blog owners who’ve been growing their audience for several years eventually hit cruise-control mode, in which things seem to run on autopilot. Those of you who might be using your blog as a steady cash cow to keep semi-passive income streaming into your bank account monthly might wonder: Why sell it in the first place?
The answer we get from many blog owners looking to exit their business for a large capital gain is a mixture of life events, including purchasing a home or expecting a child, and finding other opportunities in larger acquisitions.
Before we break down how to sell your blog, we should cover the time frame you can expect it to take to receive a six-figure offer on your content-based business.
As a general guideline for the rest of this article, let’s assume you’ve been growing a blog for more than two years and have more than 100 blog posts. Based on the data from our marketplace, we know that you need to be making about $3,000/month in average net profit for a 12-month period before you can justify a six-figure listing price.
The first question is, when is the right time to sell?
If you happen to be generating less than the 3k/month in net profit mentioned above, it can be incredibly difficult to “time the market” for when you should sell your blog. Because buyers often have their own characteristics regarding what, when, and why they acquire a new business, you may have difficulty finding a buyer willing to pay six figures or more for something that doesn’t meet their specific needs. No matter what your blog is generating in net profits, after you’ve reached your own personal plateau in the blog’s growth, it’s always better to pass on the torch before the business collapses completely due to negligence.
How Your Blog Is Valued
A common formula people use is EBITDA × Your Multiple.
Our valuation formula is slightly different from other online brokers’ in that we use a variation of EBITDA. Instead of using a yearly average, we look at the monthly average over a given time period, often between 6 and 12 months.
Our formula is as follows:
12-month average net profit × multiple
The first part of this formula is easy to understand; however, figuring out your multiple takes further explanation so you can fully grasp the concept. Multiples can be anywhere in the ballpark from 20x monthly net profit all the way up to 80x+. It makes sense when you consider how each blog differs from others and whether they’re operating in the same monetization or even the same niche; there will be differentiating factors among blogs.
One of the most important parts to understanding how your blog is going to be valued and what it will ultimately be sold for is knowing what goes into creating your multiple. A lot goes into finding the multiple for your content business, perhaps more than this article can really cover in full. Here are just a few considerations besides net profit:
- Age of the blog
- Traffic diversity
- Revenue diversity
- Brand names and trademarks
- Operational systems in place
- Social media engagement
The multiple that your blog receives from our valuation tool ultimately depends on these factors and other details that we check related to the blog’s current state and its relation to similar assets on the market. A lot of these are based on common sense but also reflect the business’s growth trajectory. When you reach that plateau in growing your blog, you must put yourself in the shoes of a buyer and ask yourself why you would invest in growing this business further.
How Much Value Does Your Blog Bring to the Buyer?
Building on your business’s growth trajectory, you need to have a clear, detailed road map to success before buyers will even consider your blog at this price point. Also, if you’re looking to make a deal without the services of a broker, such as those we provide, you need to prepare much further in advance.
A buyer looking to acquire your blog won’t be interested in vanity metrics. Important factors are your traffic and revenue numbers, whether niche popularity is growing or declining, and how much work goes into the business. These are all questions that you should have answers to, along with any additional information you feel sets your blog apart from any other content business these buyers may have their eyes on.
Who Will Buy Your Blog?
Owning the largest curated marketplace for buying and selling digital assets means we’ve seen every type of buyer there is. If you look at the buyer personas we’ve created for those of you interested in learning more about who would actually buy your blog, you’ll notice a trend in content-based buyers.
When it comes to growing and scaling a blog and, more specifically, a content business, your content itself is the asset. Not every buyer is looking for something that requires a huge amount of sweat equity, but neither is everyone looking for something optimized to the point that there’s no room to scale further. Find a happy medium between plenty of room to scale and having high-quality content as a foundation for a buyer to build on. Doing so will move you toward making that six-figure exit much sooner.
How to Sell Your Blog
If this is the first time you’ve considered selling your blog and you’re curious about what all it entails, then this section’s for you. To set realistic expectations, you should first be aware that the time from listing your content business on our marketplace to selling it is usually between 30 and 45 days. This doesn’t include the migration service we offer, which is something that we pride ourselves on offering to every seller, and what could be considered the most important stage: receiving your money for the asset.
A blog doesn’t always sell in 45 days. We’ve seen some content-based sites sell on our marketplace for $1.8M in 46 days, but this delay should be expected with such a large transaction. You can always check our latest stats on our scoreboard if you’re interested in these numbers. Because it takes time to run through the proper checks, the larger your business is, the more time our vetting team spends reviewing it. Here are a few ways you can stand out from the rest to increase buyer interest in your blog and increase the multiple while doing so.
Act Like a Media Company
In order for your blog to catch the eye of those willing to shell out $100k+ for a content business, you need to have the right mindset. You need to think like a business owner who’s looking to sell a valuable asset, not a personal blogger who’s doing it just for fun. Your blog should run more like a media company than a personal blog, and having that mindset is key to reaching your goals.
When you shift from the personal blogger mindset to the content business owner mindset, you start treating your hobby turned business as a valuable asset that buyers are willing to pay serious money for. Your blog might have started as something fun that you did in your spare time, but now it presents serious potential to content-site buyers as a real digital asset. If you haven’t already, you need to establish a voice that you become famous for among your target audience. However, if at all possible, avoid being the “face” of the blog or content you provide, because being that face makes it much harder to sell to a potential buyer who knows that if you leave, the audience might also leave.
Get Your Documents in Order
This is one of the most important things you can do as a business owner and something many online business owners fail to keep track of. Having a detailed profit and loss (P&L) sheet for every expense and dollar made is important not only for you as the blog owner, but also for those seriously considering acquiring your business.
You should have clear details regarding the exact figures for all expenses, profits and losses by channel, and any other important business costs that were needed to get your blog to where it is today. These important metrics will be used in all your future negotiations and any deal structuring that may come into effect should a buyer present that type of offer. Your analytics information can be analyzed using account access, but your P&L takes a more manual approach to track correctly. Any other documentation, including asset purchase agreements and trademark details, should be collected and ready to present to buyers well before any negotiations begin.
Have a Set of SOPs
If you haven’t yet created standard operating procedures (SOPs) for your blog, you’re holding yourself back from that six-figure exit down the road. Because of the nature of content sites in general, a set of SOPs is a huge value-add for those looking to acquire an established blog. Having detailed instructions and step-by-step guides for each process that can be used to further scale the business is worth far more money to you than your cloud-storage fees.
When you lay out the entire process you’ve performed for your blog from start to finish, you give a potential buyer a more turn-key solution than a new business venture they’d need to learn from scratch. Having the operational details in writing and easily accessible to outsourced virtual assistants (VAs) means that the buyer can focus on their core skill to scale the business, and their VAs can follow your procedures without needing to receive an in-depth demo from the blog’s new owner.
Negotiating the Price of Your Blog
If you’re in the position where buyers are coming to you with offers for your blog-turned-media-company, then you’re doing something right. Those receiving a big influx of interest in acquiring their business often notice that some type of deal structuring is in play, especially in the seven-figure price range. Because both parties want to get the best deal at the end of the day, deal structuring can benefit both buyers and sellers.
While most sellers would opt for a full cash offer (obviously), you may be leaving money on the table should you take that deal before seeing what others are willing to negotiate on. Oftentimes, a buyer is willing to pay a premium for your business based on an earnout agreement that limits their risk after acquiring your blog, say, for example, right before the holidays. In an earnout that releases the funds for the business in increments that both parties agree on, the risk is far less for the buyer, who often has a pool of investors providing the startup capital for 7-figure+ assets. As the seller, the benefit for you is that you get a higher multiple, so if your blog isn’t making that $3,000/month net profit just yet, you can hope to get close to a six-figure sum by listing for a higher multiple based on an earnout that matches your exit strategy.
Migrating the Business to the New Owner
To successfully exit your blog for six figures or more, you’ll need to ensure the smooth migration of the business. One thing that many sellers offer when listing their blog for sale is additional support to help ease the transition to the new owner. We’ve seen countless cases in which a buyer ultimately pulled the trigger on multiples above the list price simply because the seller agreed to provide additional support after the sale.
Any kind of post-sales support you can offer potential buyers looking to acquire your content business helps drive the multiple in your favor. Because many private sellers might worry about the risk of not getting paid for their business after a buyer takes it over, using a broker helps assure you that nothing will be handed over until after the business has completed the inspection period.
This inspection period is something we offer after our migration team has successfully transferred any affiliate and advertising links to the buyer’s accounts. Funds are held for 14 days to verify that the revenue is more than 50% of what your content business was listed at.
So, what happens if it DOES fall below the 50% threshold?
In that case, the buyer can either renegotiate the final sale price for the business, which is something our migration advisers and business analysts can help with, or the buyer can reverse the deal because the revenue is below the 50% threshold.
If this happens, our migration advisers go through all their checklists again to make sure everything was reported correctly.
It’s important to remember that everything must be set up exactly as the content business being sold was set up. That means if the buyer wants to change to a different hosting service than the seller had, they must wait until after the 14-day inspection period.
It’s worth noting that the buyer can end the 14-day period at any time. Many buyers are happy to end the inspection period sooner if they’re experiencing rapid growth; signing off early means they can start doing other tasks associated with scaling up their acquisition, such as conversion rate optimization or new SEO initiatives.
After the inspection period is successfully completed, we release the seller’s money minus our commission. This is the money the buyer wired to us using either a bank wire or cryptocurrency. After the seller is paid, the deal is done, and the migration is complete.
Where to Sell Your Blog?
Before you start dreaming of walking away from your content business with a huge payout, we should cover some of the options for listing your business for sale. Many startup builders say that finding a buyer on social media is a great option; however, be wary of potential scammers. When you perform a private sale, you’re putting at risk not only yourself but also the business you’ve spent the last few years growing.
A better option would be to find auction sites that present and market your content site to buyers actively looking to acquire a blog just like yours. The benefit of using one of these auction platforms is that all the marketing is done for you, and the reach potential in presenting your offer to a large pool of investors is all done in one place.
In our opinion, the best option for selling your blog is to use our very own marketplace, because we have the largest pool of online business buyers anywhere in the world. That’s right: Not only will you have the option to market your business for sale to thousands of active buyers in one shot, but you’ll also rest easy knowing that our team will help you at every step along the process, from beginning to end.
Timeline to Prepare for a Sale
By putting together everything you’ve learned in this post, you should now have a better idea of the logistics of how to sell your blog.
So that they gain the most from their selling experience in our marketplace, we advise business owners to begin tracking their P&L statements a minimum of 12 months prior to submitting their business using our valuation tool.
You can also use this tool to calculate where your blog stands now before making any of the needed adjustments covered in this guide.
Six months before listing, you should have a general overview of your site’s performance metrics and detailed data showing upward growth in the most important metrics. Three months prior to listing, you should have systems in place for the daily operations and your SOPs documented for any tasks that could easily be outsourced to VAs should a buyer have them.
If you’re ready to make the jump, schedule a call with one of our business advisors, and they can help get you started on exit planning to reach your business goal sooner: walking away from your blog with six figures—or even more—in the bank after gearing up your passion project to be the next big media company everyone wants a piece of.