Selling a profitable website can be a quick way to get the value out of your asset (the website) in order to use that money for something else – usually to invest in other projects you have, or to diversify into other investments.
I get asked “how do I sell a website” quite often, and for something that seems so simple on the surface, the process can be a little tricky if you’ve never done it before.
In this guide, I’ll give you the steps on how to sell your website in the best possible way.
This is going to be a long article, but if you’re in a hurry and just want to find out how to sell a website quickly, here are the basic steps you need to follow:
Okay, “complete” gets used a lot online to try and make the content seem like it’s the best. I’ll try to be as comprehensive as possible using my own process for selling a website but there is no such thing as a complete guide.
So, you’ve got a successful website, it’s making money and getting visitors, and you want to sell it so that you can use the funds elsewhere.
Whatever the reason for selling your website, cashing out allows you to take advantage of the time value of money – a principle that basically means that $1 in your hand today is better than $2 in your hand next month.
By leveraging your website as an asset to sell you have the advantage of a lump sum of capital in your hand, which you can then use to invest and grow your net worth.
The first step in selling a website is to make sure your site is as attractive and “sellable” to a buyer as possible.
Maximizing your website before you sell is the best way to ensure you get the biggest sale price possible.
Ideally, you want to be sure you’ve taken the site as far as you can at least three months before you sell. This gives your changes time to have an impact on conversions, and ultimately revenue and profits.
A buyer will be much more interested in a website that is relatively passive than a “fixer-upper” that requires work and investment to realize the potential.
Design is a subjective thing, but it’s very easy to land on a website and notice that it doesn’t “feel” quite right.
A poor design can make your website appear unprofessional, or worse, spammy.
Luckily, it’s easy to make very simple design changes to your website so that it’s easy to use and engaging for the users:
If your website is content-based, then it’s very likely that you’re using WordPress.
For WordPress, the only theme I have found that allows you to build a website that matches all of the above criteria (and more) and quickly build beautiful, mobile-responsive, websites, is GeneratePress.
Once you have your site design looking attractive to a buyer, the next step is to focus on how much it’s earning you.
The most common way to value a website is through a multiple of your annual earnings. This means that more earnings will lead to a higher sale price.
If your site is making $10,000 a year and you sell it for a 3x multiple, your sale price is $30,000.
This means that if you can increase the yearly earnings to $12,000, your sale price jumps to $36,000!
Here are some ways you can increase your website earnings before you sell it:
Optimizing your website earnings before selling can take a while, so I’d recommend focusing on this at least 3-6 months before you want to sell if possible.
If you’re looking for a quicker sale, you may not have time to do this, but it’s the best way to increase your asking price so if you can put the time in, it’s worth it.
Learning how to sell a website without first valuing it is a bit like trying to learn to drive without getting behind the wheel.
There are many ways to value your website to get the best price possible, and valuation can depend on a number of factors, including:
Note: I read in an article on another blog that “most” websites sell for 6-10x their monthly profit. For established websites, this is completely wrong.
The multiple is often 2-4x your annual profit, depending on the factors above.
If you sell a subscription that is recurring every month/year, this is more valuable than a one-time product, an affiliate sale, or simple ads, and the multiple to sell your website could be higher.
The most common issue I see when people want to sell their website is that they overvalue it – often by a lot!
If your site is making $10,000 a year, it’s very unlikely you’ll be able to sell it for $100,000+ but this is what many sellers do!
You obviously want to list the high end of the multiple to encourage bids and negotiations, but if you list too high you will price yourself out of the site before it’s even begun.
If you end up using a website broker to help you sell your website, they will most likely do a lot of this work for you and their team will analyze your site, traffic, revenue, etc to give you a suggested sale price.
Once you have a ballpark number you’d be willing to sell your site for you can put together the due diligence pieces that a serious buyer is likely to ask for, and save you time later on.
No matter how you sell your site, the prospective buyer is going to do their due diligence and ask you for proof that this is a website they want to buy.
The below list should cover most of the common due diligence questions you may get from a buyer:
Again, a good website broker can help to answer all of these questions and more, but be aware that they will charge 15% of the sale fee to do so (I only charge 5% 😉).
It’s good practice to think about the due diligence required because, in the future, you might want to deal directly with a buyer to avoid the broker fees and it pays to know what due diligence will be needed.
Once you have everything in order for a prospective buyer, the next step is to find yourself someone to sell your website to.
There are many places to sell your website but not all of them are made equal. For lower-priced websites, an open marketplace might be okay, but if you have a larger website you might want to consider hiring a professional website broker to sell the website on your behalf.
Flippa is one of the most popular and well-known website marketplaces on the web. They were one of the first marketplaces of their kind and, as a result, have a huge audience of buyers.
Flippa is really the eBay of selling websites. Mass market, easy to list, and lots of potential buyers.
The problem with Flippa is that because it is so accessible, selling your website with them can be tiresome and painful. In particular:
Empire Flippers is more of a curated marketplace and to sell your site here you need to go through a fairly comprehensive vetting process.
The benefit of this is that once you have provided all of the information on your website, they handle the rest.
Buyers need to pay a deposit to even see your website URL so it completely removes the time wasters that you would get on marketplaces like Flippa.
In order to sell with Empire Flippers you need close to $1,000 a month in net profit and they do list at a pretty good multiple for sellers.
If your website makes enough to qualify, this is a much better option than Flippa.
FE International is the biggest website broker and the most well-known in the industry. They are much more business-focused than Empire Flippers.
You might notice they use more business terms like Seller Discretionary Earnings (SDE) and this is because their client list is typically higher quality than that of Empire Flippers.
Buyers must complete a non-disclosure agreement (NDA) before they get access to your website prospectus and they need to provide their legal name and address – which is another great way to deter time wasters.
In my experience, websites sold on Empire Flippers are slightly lower quality than those sold on FE International (although there are exceptions).
FE also has an incredible sale rate and a proven track record over many years in the website brokering business.
When starting out on the journey to sell your website, you’ll probably choose a marketplace or a broker – it’s just the easiest option.
But if you have a number of websites, and you buy and sell a lot of them, you’ll probably gain a pretty good contact list of website buyers to sell to.
This is invaluable because you then have a direct line of communication with qualified buyers.
This is beneficial because:
You can do deals much quicker and make more money if you’re dealing directly with a buyer you’ve dealt with before.
Even if it’s a new buyer that you found by outreaching competitors of your website, the process can still be quicker and just as secure if you use a safe payment method (as discussed below).
This is my preferred method for selling a website – but I have built up a list of buyers over the years.
If you’ve got this far into the article, well done! The final step on how to sell your website is the most exciting of all – getting paid!
Once the negotiations and due diligence and handover documents and back and forth is said and done, taking payment is a relatively easy process.
Unless you’re selling for a low amount (less than $1k) or to a previous buyer – using Escrow.com is an absolute no-brainer.
Here’s how it works:
Since the money is held in escrow by a third party, it’s a very secure process that protects you as the seller, as well as the buyer.
The inspection period allows the buyer time to take control of the website on their own hosting and to change any advertising, affiliate links, product sales accounts so that they can verify the earnings in real-time.
There is a fee for Escrow.com but it’s so low that it’s worth it for any transaction over $1,000 in my opinion.
Again, if you have a history with the buyer, they may trust you enough to wire you the funds straight to your bank account and then you transfer the assets but, for most website sellers, Escrow.com is the ticket.
This article is the result of 10 years of knowledge I have buying and selling websites.
There are plenty of other ways you could sell your website, other avenues to explore, and new ideas I haven’t used.
However, this method has worked for me time and time again. I like to keep my website selling process simple and easy to follow.
Good luck on your journey to sell your website and you have any questions or advice, feel free to get in touch.