I wanted to start a blog so that people that needed a financial planner could find me online and then hire me.
That was my sole purpose of getting Good Financial Cents off the ground.
I was oblivious that people could actually make real money from their blogs through Google Adsense, affiliate conversions, banner ads, etc.
It was a world that I didn’t even know existed.
Fast forward four years later and now I’m fully emerged into blogging and I love it!
Most people that don’t get blogging view it solely as a hobby; they don’t think you can actually make money online.
Surprise! You can. 🙂
And when you start making money on your blog, it no longer remains just a hobby You now have a legitimate business that has a real value.
Think about it. If your blog is making money, than you have an income generating asset that is really worth something, and if something has value, there will always be a potential buyer.
I have never thought about selling my blog.
I know there are some big blogs in the personal finance space that have sold for a large sum.
How large? Like 7 figure large.
Even though I saw those sites sell it was something that still never crossed my mind.
Occasionally I get unsolicited emails from potential buyers, but most of them are bogus. They are hoping your clueless when it comes to valuing your blog and that you’ll take some low ball offer. Those emails get quickly marked “spam” and move one.
Then one day I received the following email:
This email was a lot different than any previous one that I had received. The first difference was that they actually addressed me by my first name. Do you know how many emails I get that start with “Hi,”.
Do you know how many of those are immediately marked “spam”? Hint: ALL OF THEM.
The second item that caught my curiosity was that they referenced other sites they owned which were solid domains. (I marked them out to protect the buyer).
Even still I wasn’t interested in selling, but I was curious to learn more about how they valued my site and what they were willing to pay. I shot them back a short email letting them know just that. Here was their response:
After a few more email exchanges I could tell that they were very serious about buying my site. What was really intriguing was that they were willing to keep me on as “founding editor” so that if people still wanted to hire me for my financial planning services they still could. Plus, they were not going to make me sign a non-compete clause. That means that if I wanted to start a new financial planning blog I could. That was huge.
All these factors enticed me to at least get on the phone with my suitors to see what they were willing to pay.
I set the call for a Friday morning. That was intentional so that if they did make me an offer that I couldn’t refuse, I would at least have the weekend to think about it.
The call started out very good. They were very complimentary of my site. One of the most attractive features of my site was the personal branding element that I had pulled off quite well. This actually surprised me because I’ve always been fearful that if I ever wanted to sell my blog that I had too much of “me” in the site, but their comments said otherwise.
Most of the call consisted of me sharing some of my income numbers which I thought was funny. All they had to do is read the income reports on this blog. 🙂
We also talked about my traffic numbers. I was upfront with them how my site had got hit by Panda but thus far had sustained any further Penguin updates. (You can read more more how my site got hit by Panda and what I did to get out of it).
He then verified some of my top ranking keywords to see if they matched what his research tools were telling him. After some more questions came the question I was waiting for:
How much would you sell your site for?
The Dramatic Pause
If there is one valuable lesson to be learned here, this it:
Never name your price.
Even if it’s $1 million dollars don’t let the buyer know what you would be willing to sell for. This is often referred to as a “price anchor” and you never want your buyer to know what yours is. At least in the first round of negotiating.
Make them tell you how much they think your site is worth.
When I finally had to address his question, I responded, “I’m not really sure what I would sell for. My blog is my baby plus I’ve seen significant revenue growth in the past year.”
The buyer was full aware of my other online projects such as my book, Soldier of Finance, and The Debt Movement, so I think he was hopeful that I was ready to move on from this blog and focus my efforts that way. Much of his sales pitch was centered around that with also the potential for capital gains tax to go up in future years dangling the lower taxes carrot in front of me.
I still never hinted at a selling price. The only thing I really mustered was something like, “If I were to sell, I would want a buyer that saw the value that my blog has as well as future potential”.
Finally after hemming and hawing around it, he finally said that without even seeing my Google Analytics that he would offer me $150,000 cash for my site.
Do you know how many times I get offered $150,000 cash for something? Not often!
If I felt that my site was worth more, he would need to get access to my analytics so they could determine what their valuation would be.
The conversation ended with me deciding if I would allow them access and continue discussions of a possible sell. As planned, I had the weekend to think about it.
I had already decided on the phone call that day, but I thought I would it be at least worth sleeping on.
My wife and I talked about it for a while and she even asked me the question “What would I sell for?”. I couldn’t even answer her.
I think that’s when I really knew the answer.
There’s no need to drag it out as I decided not to sell. What I thought would be helpful to you is to share why I chose not to sell.
Why I Said “Thanks, but no thanks”
Reason #1: This is my baby
I have spent hours, upon hours, upon hours researching blogging and getting my site the exact way that I wanted. It’s almost like I’ve raised a kid! My blog is my baby and it just turned four years old. The thought of giving it away, even at a nice selling price, is still a hard pill to swallow. <gulp>
Also, the exposure that it gets me is priceless. A recent example was that I was asked to write for Market Watch owned by the Wall Street Journal.
How did they find me? My blog!
I’ve had so many opportunities like this present themselves all because of my little ol’ blog.
Reason #2: $150,000 is not a game changer
Don’t get me wrong, $150,000 is A LOT of money. But at this point in my life, it’s not that large of a sum that changes the way that I live. You also have to keep in mind that I wouldn’t be netting the full $150,000. After taxes, broker fees, etc., I would probably net closer to $100,000.
I still think I could have got more had I allowed access to Analytics. My hunch is that the offer would have been in the $250k-$350k range.
Do I know that for sure? Of course not, but based on certain metrics I think it would have been a fair offer.
If I were ever to sell the blog, I would have to get an amount that would generate a nice passive income. With interest rates being so low, I’d be lucky to get 4% on my money before tax. Even if the blog sold for $1 million that would only be $40,000 a year, which is a nice chunk of change, but still not a game changer.
Reason #3: My blog revenue is growing
You can check my opening income report in December of 2011 where my blog brought in roughly just under $1200. Over the last several months, my blog has been averaging between $7000, $8000, and even $9000 a month – a huge increase.
I didn’t even start affiliate marketing until spring of last year. That has dramatically increased now that I’ve been able to put more effort into it.
Will the streak continue in 2013? Only Google knows the true answer to that question but I know that I’m not going to let up anytime soon.
What would you have done in my situation? Am I crazy for not selling or at least countering?