I was talking to a comedy blogger the other day who told me about another blogger who recently decided to auction off his blog and eventually wound up selling it for $35,000. This is a pretty nice chunk of change and I thought it would be worth sharing a break down of exactly what the blog was and why somebody felt it was worth acquiring for $35,000.
First, a little backstory. The blog that was sold was Don Chavez, a popular blog which has been around since 2006 and covered all sorts of things of interest to guys including comedy, sports, and lots of pictures of hot girls among other things. Don Chavez was also a featured site in my 100+ Places To Promote Your Comedy Content premium report.
The site was auctioned off through Flippa, which is a site which helps people buy and sell websites, and the sale went through in January.
You can check out the auction page for the Don Chavez sale if you’d like to check out all the details of the site and its sale, but I thought I’d also highlight some of the things that stood out to me about it. These should help give you some sense of what it takes to build a blog that’s worth $35,000 to somebody else.
You Need To Have A Lot Of Content
According to the auction site, Don Chavez featured 5,200 unique posts on the site and had 47,000 pages that were indexed by Google. The pages number is bigger because Don Chavez featured a lot of photo galleries and each individual photo creates its own page. I’m a big believer that in order to really build a successful blog or website, you need to be posting content just about every day and this backs that up.
Sites that only post sporadically rarely if ever build large audiences and a look at these numbers shows you the kind of commitment it takes to producing content in order to build value. These numbers mean that Don Chavez on average posted three new pieces of content EVERY DAY for five years.
You Need A Large Audience, But It Doesn’t Have To Be Impossibly Large
Don Chavez was getting 250,000 unique visitors to the website every month and while this is a large number, it’s not so large that it seems unattainable. The site also had 2,250 people subscribe to its RSS feed and 2,049 people subscribe to its email list. Again, these are good numbers but not so amazing that it doesn’t seem like something that could be done. After all, lots of you probably already have more than 2,000 people on your own email lists.
Additionally, 18% of the site’s traffic (approximately 45,000 people each month) was coming from search engines and only 15% of its traffic (37,500 people) was coming from people who directly typed the URL into their browsers, which suggests its core fan base was actually less than 50,000 people. Again, this isn’t a number that’s too intimidating to think you could attain with good content.
You Need To Have Relationships With Other Sites And Be Part Of A Community
While most comedians are terrible at working together and cross-promoting each other’s creations, almost all successful bloggers have mastered the skill. They link to each other, they trade traffic, and they understand that it’s incredibly difficult to succeed in gaining an audience online without becoming a part of a community. Sure enough, Don Chavez mastered these kinds of relationships and as a result these relationships were the site’s number one source of traffic.
A whopping 65% of Don Chavez’s traffic (about 162,500 people a month) came to the site from other websites who linked to Don Chavez content. This is how the web works. And it’s why one of the big selling points in the auction was that the site’s relationships with other traffic driving blogs in the space would stay in tact for whoever bought the site.
The lesson? If you’ve got any thoughts of building a big audience for your online creations, you better be prepared to make some friends elsewhere in the online community that can help you do it.
Making A Little Money Can Help You Make A Lot Of Money
Even before this sale, Don Chavez was a profitable operation. As is detailed on the auction page, the site was generating approximately $2,500 a month and only costing about $150 a month to run (web hosting was the only real cost). This is important because it means that the blogger had not only attracted an audience and created a lot of content on the site, but he had also laid the groundwork for a business plan and was already monetizing on some level.
This likely made the blog much more attractive than it otherwise would have been to an investor because now the investor can see exactly how he will make his $35,000 back. Don Chavez was making that revenue through deals with several ad networks including Blogstand Media and Break Media, so potential buyers knew they could count on continuing those relationships and potentially supplementing them with even higher-rate advertisers.
Too often, comedy creators concentrate on asking people to invest in their creations based on its entertainment value or audience, without ever actually doing anything to show potential investors how they can actually make a profit on their investment.
You Have To Be Willing To Commit The Time To Make It Work
Despite the myth of viral success, it usually takes a lot of time and work in order to build anything of value and that’s true on the web as well. In the case of Don Chavez, the seller estimates that he spent 2 hours a day, 5 days a week working on the blog. After all, those three posts a day aren’t going to create themselves. That means that he had put in 10 hours a week for five years prior to selling it.
If you’re working on a project or anything to further your career, are you willing to put in 10 hours a week to make it succeed? Are you willing to do that for five years? And if you’re not doing that yet, how much further along do you think you would be with your projects if you did? Success doesn’t just happen, it has to be earned.
For a look at how you can monetize your videos, check out this post about what it takes to make $11,000 a month on YouTube.
I would say that the value of a blog should at least be the current monthly income calculated up to two years. So in that light, he should have gotten at least 70,000$.
Furthermore, traffic could no doubt have generated a lot of exciting backlinks to other projects, so a potential buyer would probably been willing to stretch the amount to 75-80,000$.
But a good example that shows that blogging pays in many ways indeed. 🙂
I agree, this was a terrible deal for the seller, and a steal for the buyer. The sale was not much more than one year’s income. All they need do is run it for a year, make back their purchase price, plus the $80,000+ they’ll get when they resell. That’s without any of the easy tricks to increase value you can do.
This is the slightly strange thing with online business valuations. Broadly speaking a website is worth anything from 10 to 24 times the monthly profit. Try getting an offline business at the same price!
It is the perceived risk factor that makes them worth less, unless of course you’re in the higher echelons like YouTube, Groupon, Facebook etc. Strange thing is that offline businesses in many ways have a far higher risk, usually have huge overheads to constantly meet and a downturn can mean bankruptcy, whereas for most smaller online sites it just means no more money coming in.
Buying a good blog like this is a steal, $35,000 and you should be getting annual return of about 80% on your investment!
Wow, 10 hours a week for 5 years; anyone saying they can’t do that is lazy as sin. Of course there’s the point about 3 posts a day and how people view that sort of thing. Since you mentioned he had lots of posts with images, that would probably be taken better over the long term than if it had all been straight up content.
Thanks for writing this up, and congrats to Don for the sale at any cost.
Excellent article. I have to say the challenge is not only posting regularly, but also posting that brings some value. Organizing thoughts and Ideal in a logical manner which has value can be challenging when your balancing all your other activities. Daily or weekly blog goals, and scheduling yourself to write and post, is probably the best answer, along with keeping a daily blog notebook for posting ideas.