Opinions on Rick’s latest batch of web sites for sale.
Rick Latona has posted his five latest web sites for sale, which he says his team hand picked from 1,000s of sites.
I’m a big fan of buying and selling revenue-producing web sites and I’ve done it myself. Latona’s announcement asked for feedback, so here’s mine on the five sites.
EasyToInsureMe.com – this property has approximate annual revenue of $100,000 and an asking price of $170,000. The description states that traffic is up 78% since January, which makes me think this revenue is annualized based on recent months. So the site history is fairly weak. It’s also up to about 1,300 uniques per month. That’s not a lot for a site that makes $100k a year. It’s possible on a well designed lead gen site, though. I’d verify all traffic to this site and make sure it’s organic. Deduct any PPC costs. Think hard about if the site revenue is sustainable. Also think about the trademarked terms that the site ranks for in SEO.
ReviewCar.com – This lead gen and online advertising site claims revenue of $26,400 per year and is asking nearly 5x revenue, a very high price. I can’t get the site to load correctly in FireFox but it does work in Chrome. Revenue is mainly from Adsense with some from SureHits. I’d want to make sure that revenue is steady, especially since it’s concentrated. There’s a stale forum on the site that could be boosted, but forum traffic doesn’t do as well for PPC advertising as other traffic. Be sure to figure out how much time the owner spends on the site and deduct this as a cost from revenues.
HousingPredictor.com – According to the site, HousingPredictor.com has been featured in publications such as New York Times and The Wall Street Journal. As a buyer you’ll want to figure out if it’s the owner’s expertise or the site that is most often quoted. Also see how recent these mentions are. The site makes about $25k top line a year and is asking $125k. It looks like the owner writes a lot of the articles, and this cost must be taken out of your revenue to figure out profit. At a minimum we’re talking a rich 5x earnings, and I expect it’s higher when you consider the true costs.
GolfCartMotors.com – This site makes annual revenue of $5,400 with an asking price of $16,500. The owner sells a product and basically marks it up based on a relationship with a supplier. It’s sort of like drop-ship, but it’s not clear if it’s that seamless. The first big question is if that revenue number is actually a profit number. If not, you need to deduct the cost of the motors which changes the entire equation. The site gets 877 uniques a month, primarily from one search term. Ask yourself if there’s any way to increase this or if it’s just a small niche. How defensible is it?
Edugree.com – This site has potential for someone who wants to put in some serious elbow grease. Its annual revenues are $3500 on 31,000 monthly uniques. It’s stale, with the last post (according to the home page) in October 2010. This can be a problem, but is also a sign that there’s room to grow. I’d consider the SEO base and if that’s worth the $11,700 asking price.
Again, I’m a huge fan of the business model of buying and selling existing web sites. These are just my observations on these five sites.
Where are these on his website?
I agree. If Rick thinks selling domains was getting to hit and miss I think he is going to be disappointed with this model. I can’t see a single one of those selling at or even near the asking price.
Flippa has significantly better deals.
On Flippa you can get sites for 1-1.5 times profit… and Latona is trying to sell for 5 times revenue?
Not sure I follow these asking price valuations.
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I would not purchase anything from this guy.
He changes his mind more than I change my underwear.
His mini-site business was a total bomb. People lost money on that deal.
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Very well done analysis.
I agree. Grossly overpriced websites.
A Latonas broker approached us to buy one of our websites for one of their “clients”. Uh-huh.
I find the prices above very interesting because they tried to negotiate us into selling our site for *well* under 1X annual revenue. I’m talking about .7 times.
I had a feeling that if we sold, they would have flipped it for 3X, 4X annual revenues or more.
I’m interested to see which websites end up selling.
Most of the sites he is selling seem to be built out landing/CPA sites probably with substantial PPC and/or paid link costs behind them. Buying something like that for 5 years revenue isn’t a good move. Good affiliates churn them out like butter and they take much more skill to keep running successfully.
I simply want to know why Ms. Domainer changes her underwear so much. 🙂
Great reviews!
I hope you do it every time Latona posts new sites for sale.
Thx!
Crap domains, high risk revenue streams, and prices that are laughable. Rick can’t seem to shake the pawn broker out of himself. My guess is that he’ll be searching for a new career in the short term. There is just no way you can survive in this industry wanting everything for pennies and selling crap for millions.
How’d that prediction work out for you?
Who is selling and why?
There are many details not shown. I’d want to know exactly where the revenue is coming from.
It’s also not clear if there is any guarantee. Is Rick on the hook if any of these are pigs with lipstick?
“Where are these on his website?”
Jeff,
You’ll find them here:
http://latonas.com/web-properties-for-sale/
I think there are several issues that will limit the success. First, their is no transaparency. No verifiable stats are posted online. No revenues are verified. The traffic is minimal at best on the insurance related sites and my experience leads me to believe that the revenue/traffic correlation seems inflated. If I were forking over 100k or 500k for a lead gen site, I certainly would not be buying it based on the Latona’s seal of approval and would prefer to do my own due dillegence at this point the transaparency with Flippa vs Latona’s is a big problem.
@ Don – to be fair, I think this is just a listing to get you to call in. At that point you can have a discussion with the seller to get all the details.
@ andrew…perhaps, but I think one of the fair criticims with Latona’s and a number of projects from his company is that they launch without having all of the necessary components in place for what is standard in the industry. I think you would get more interested buyers willing to kick the tires if you provided more details, stats, etc and not less. I am not trying to rip his site apart, but I think have some real red flag listings for sale right off the bat is not the best way to build online credability..just my 2 cents.
@ Bryan G It’s also not clear if there is any guarantee. Is Rick on the hook if any of these are pigs with lipstick?
I hear via the domain vine that if results are not as advertised Rick will pawn a watch to make up the difference and have Kevin Leto build the disgruntled purchaser a free guaranteed to produce minisite.
It looks like he purchases domains that are minimally active (miine- I thought I had ported it, am not very computer literate with these things) and now is offering me to purchase my “very active website” for $299. This was not a very active business site (I know, I was managing it- poorly, but it was mine) and now it’s not. Thanks jerk. I’ll just change my business cards. Ugh.
I have recently sold a site with FE INTERNATIONAL brokerage service for 1.5x revenue. They are quick and good. I could have sold through Flippa Deal Flow, but they require you to sign for a 60 days agreement to not to sell using other brokerages or directly. I sold for $5xxxx.
I have 3 more similar sites, and will try flippa service once to compare them with fe international.