As the owner of a WordPress website, you’ll accomplish many memorable milestones.
The milestones start off small, like celebrating the first dollar earned from your site, or your first 100 page views. As you tick off these milestones and set goals for the future of your business, it’s important to ask yourself, “Where is the finish line?”
While each entrepreneur has different goals they’d like to meet, the final milestone remains the same for the majority of website owners; to make a successful exit from your WordPress site.
But while many site owners are experts at creating quality content or optimizing their SEO, they often don’t fully understand how to prepare their sites for a profitable exit, or what the sale process involves.
If you fall into this category, then worry not, because this article will give you all the information you need to successfully sell your WordPress site.
Why Should You Sell Your WordPress Site?
There are numerous benefits to owning a WordPress site, like multiple ways to diversify your website’s revenue, the ability to operate your site from almost anywhere in the world, and the fact that websites are not as capital-intensive as other online business models like eCommerce or SaaS.
Finally Escape Algorithm Updates
But it’s not always smooth sailing as a WordPress site owner. It’s a fiercely competitive arena, with new sites competing for a portion of your traffic every day. Website owners are plagued by Google algorithm updates and have to stay up to date on the latest SEO techniques and trends to keep their heads above the water.
Exiting your business allows you to escape these risks and reap the rewards of your hard work.
Get Years’ Worth of Income
Selling your WordPress site gives you an almost instant infusion of capital that could amount to several months or even years’ worth of income at once. This opens up a whole new world of opportunities for you.
You could use the capital from the sale to start another business, buy a house, or use it to fund your retirement.
Lost Passion For The Niche
Other common reasons entrepreneurs choose to sell their sites are because they’ve lost their passion for the business, they’re seeking a lifestyle change, or they simply want to reclaim their free time.
Whatever your motivation, selling your WordPress site gives you a financial leg-up to chase the lifestyle you want.
How To Prepare Your WordPress Site for Sale
Selling a business isn’t an overnight process. If you want to sell your site quickly and for the best price possible, you need to put some effort into making your website attractive to potential buyers.
You can do this by creating an exit strategy.
An exit strategy is a plan of action outlining the key areas of your business that need to be addressed in order for you to get the best valuation when you go to market. Think of it as a roadmap that you can follow to spruce up your business before it gets sold.
Here are a couple of areas that you should focus on when preparing your exit strategy:
Clean Up Your Finances
The best way for an interested buyer to assess the profitability of your business is by looking through your financials. Therefore, the more time you spend preparing an organized set of financial documents, the more likely the sale of your website will go off without a hitch.
The first thing on your to-do list should be to prepare a profit and loss statement (P&L). This is a spreadsheet that breaks down your income and expenses over a certain period of time in order to calculate your business’s net profit.
If you’re selling your business through an online business broker, a P&L is one of the first documents they will need to determine the value of your business.
If your website is earning from multiple sources, you should put together a breakdown of how much money is coming from each revenue source.
You should also make sure your personal accounts are not mixed in with your business accounts. Remember, the business accounts will be transferred into the new owner’s name after the sale, so you don’t want to lose access to any of your personal information.
Before you sell, it’s a good idea to hire an accountant to give your financial documents a once over, particularly if you own a large website.
Track Your Data and Analytics
Before acquiring your site, potential buyers will want to perform due diligence to see if the site is performing as well as you’ve claimed. To do this, they’ll want to see your traffic data.
The data they’ll want to view includes:
- Pageviews
- Average Session Duration
- Top Traffic Countries
- Traffic Sources
- Top Content
- Bounce Rate
- Unique Visits
Linking an analytics platform like Google Analytics or Clicky to your website will help you to easily track these metrics. You can even grant potential buyers read-only access to your analytics to ensure that sensitive information remains confidential.
Reduce Owner Involvement
One of the most common reasons entrepreneurs want to buy an established WordPress site instead of starting one from scratch is because they are looking for a turnkey business that can function without much owner involvement.
If you’re involved in every aspect of your site, from content creation to SEO, you limit your buyer pool to only include people who can commit a large number of hours per week to the site.
By outsourcing time-consuming tasks and automating tedious procedures, your website becomes an attractive asset to a larger pool of buyers.
Build a Moat Around Your Business
When selling your WordPress site, your goal is to make it easy for potential buyers to see themselves turning a profit from your business.
If your revenue and traffic data read like a rollercoaster, with large ups and downs, it could scare off many buyers.
Focus on increasing the stability of your business by reducing seasonality and diversifying your monetization methods and traffic sources.
If you run an affiliate site, for example, you can expand the number of affiliate programs you partner with or add display ads to your site to diversify your revenue. That way, if your main affiliate partner shuts down, you won’t be left high and dry.
If the majority of your traffic comes from organic search, your business is at the mercy of the Google algorithm. Building up an email list and social media presence, and creating paid ad campaigns will help to bring in traffic from other sources, adding another layer of protection to your business.
How Much Money Does Your Website Worth?
Before selling your business, you need to answer the most crucial question: “How much is my WordPress site worth?”
You likely already have a ballpark figure in mind, but you’ll need to be able to justify your asking price to potential buyers, so the figure you come up with should be backed by data.
Here’s the valuation formula that is most commonly used to determine the value of a website:
Net Profit x Multiple = Valuation
As we discussed earlier, once you’ve prepared a P&L document, calculating your net profit should be a simple task.
Determining an accurate multiple is slightly trickier. A multiple is a figure that represents the strength and future longevity of your business. There are several factors that play a role in a website valuation multiple. These factors include:
- Business age
- Traffic diversity
- Diversity of revenue streams
- Email list subscribers
- Social media following
- Level of owner involvement
Some people use an annual multiple, but we’ve found that monthly multiples are more accurate as they provide a better idea of fluctuations in earnings throughout the year as well as any seasonality that your business may experience.
Keep in mind that the valuation this formula provides is merely a guideline. You can choose to list your business at a higher asking price, but know that it may take longer to sell. If you need to sell your business quickly, consider lowering your asking price to attract more buyers.
How To Find The Right Buyer for Your WordPress Site
The two most common ways to sell your website are via a private sale or through an online business broker.
Online Business Brokers
The benefit of selling through a broker is that you can access the large pool of buyers who frequent their marketplace. Different brokers specialize in different niches, price points, and business models so it’s worth doing a little research to identify which brokers will attract your target buyer.
Private Sale
If you choose to sell privately, you will need to track down potential buyers yourself.
Before you commit to the sale, it’s wise to verify the buyer’s identity to prevent becoming a victim of fraud. You should also verify the buyer’s liquidity to ensure that they can afford to buy your business and won’t back out at the last minute due to a lack of funds.
When advertising your business for sale, it’s important to be transparent about any potential flaws your site may have.
Remember, no website is perfect, and every weakness is a growth opportunity that the buyer can take advantage of.
Any blemishes you cover-up will almost certainly be uncovered during the buyer’s due diligence and could derail the sale of your site. Being upfront about your website’s faults will help to build trust with buyers and prevent delays when selling.
Negotiate Sales and Deals To Sell Your WordPress Site
Now that you have hung a “for sale” sign on your business, you’ve entered the final stretch of the sale process. All that’s left to do is negotiate a deal with the right buyer and transfer the business to its new owner.
When it comes to fielding offers from interested buyers, it’s important to keep a cool head. Both you and the buyer have a lot on the line, so you need to be clear about what you want to achieve from the sale while also allowing room for negotiation.
Accepting an Earnout
One of the key things you’ll need to consider is whether you are willing to accept an earnout. An earnout is a financing option that allows the buyer to pay a negotiated percentage of the asking price upfront, and then pay off the balance over a certain time period or as certain performance milestones are met.
The benefit of an earnout is that more buyers will be able to afford your business, increasing the likelihood of a speedy and successful sale. The downside is that you won’t receive the full asking price upfront, which is not ideal if you plan to use the proceeds from the sale to fund another project or business venture.
Support Provided For The Buyer
Another thing you’ll need to figure out is how much support you’re willing to give the buyer after the sale. Certain deal structures will allow you to make a clean break from the business, while others will need you to remain involved in certain aspects of the business to support the buyer.
As tempting as it may be to race to the finish line, patience is a virtue when selling your website. Taking the time to find the right buyer and deal structure will allow you to close this chapter of your entrepreneurial journey the right way.
Selling a WordPress site is easier than you think
Selling a website takes some work but the reward it’s absolutely worth it. The time and energy you’ve poured into your site could translate into a windfall that could steer your life in an exciting new direction.
Now that you’ve got a good idea of what’s needed to prepare your WordPress site for sale; all that’s left to do is to take action.
If you’re ready to begin your exit journey, submit your business for sale on the Empire Flippers marketplace today.
