[nicholas73]

Your startup is worth whatever it is worth to the buyer. This is a serious statement.

Unlike S&P stocks, a small startup does not have many buyers looking into your valuation. What one buyer is willing to pay will vary widely from another.

A prospective buyer will consider things besides your revenue history. Such as operation risk, potential synergy, possible changes for growth, if you are a competitor, etc. Then there is their own financial situation, and the form you are willing to take payment (like stock vs. cash).

As a poor example, if I were to buy your site, I'd take your profit and discount taxes I would owe plus some salary for my time to upkeep it (another buyer could be more or less depending on their resources). So the profit would be down to say 80k.

From there, I note that there virtually is no growth in revenue despite the growth in pageviews. Assuming no way to fix the CPM, my worry would be whether I could get my money back, especially if there could be a real estate peak.

So average Joe like me might be willing to pay a paltry 1-3x multiple of profit* (and mostly because I don't have much money to risk). A collector of web businesses might go up to 5x, as a guess, more if there is growth.

The best companies in the world (like S&P companies) fetch anywhere between 10x to 20x+ so it's highly unlikely you get that without exploding growth.

* By profit I mean after taxes and the acquirer's expenses.

[throwawayValue]

You are correct - different buyers will value the business differently based upon their intentions for it. Some would be more interested in growing the SaaS side, so far all of the offers I've received are related to this, whereas others might be more interested in growing the AdSense & affiliate revenue.

Important to note, my business provides a service which will always be in demand no matter if real estate is booming or busting.

I think if I could get a 5x sale price I would take it. Best so far has been 4x and none have been below 3x.

[hanniabu]

While it's true that the value to certain buyers will vary, if you do decide to sell, then it is your job to sell it to them. They'll only pay as much as they'll see it's worth. If they're not the most business savvy or entrepreneurial person, they will obviously not see much value and therefore would not be willing to pay a lot. However, if you explain the value and potential additional revenue streams as well as adjusted growth estimates, then they'll see past the current basic revenue stream. Take a look above at iheartmemcache's answer (the really long one). He does a great job at pointing out the possibilities to maximize revenue.

If this angle doesn't work, then try growing the business a little more in the direction of the aforementioned comment for a bit. Once you've succeeded in growing the business a bit and proving the model, go and start selling it again to people whom have contacted you previously.

[throwawayValue]

You're right - it is my responsibility to sell it and so far I've just been listening to offers and haven't countered because I wasn't interested in selling at those times. However, I now would counter all offers with a reasonable asking price and detail the reasons for that price as well as my thoughts on where the growth potential is.

I agree that iheartmemcache's response really hit it on the head and I was waiting to see if it generated any other responses. The strategy he laid out is exactly in line with what I've been thinking.