I often get asked how to valuate a business.
There are general rules such as
10 year (or less depending on leases, trademarks, contracts, etc)
discounted cash flow
plus the net worth of the business
as of today
but a big chunk of that valuation
rests on industry specific metrics.
Valuing a blog is no exception
as Lorelle VanFossen points
out in her post Selling Your Blog.
Buyers,
as in the case I saw of
a telecom company buying
a computer consulting company,
ignorant of these metrics
are likely to overpay.
In the telecom’s case,
they ended up buying a lemon
(I had to reco they close the division down).
Millions of dollars wasted.