Erik’s Blog: Board Shorts and Business Suits

For those of you who don’t know, BlogCatalog.com was recently sold over at sitepoint marketplace forums for a whopping $40,000. The site itself is one of the biggest and best directories for blogs around, very well known, the name itself is very brandable and worth a bit.

On top of that the site makes $1700 a month on what I would consider very very very minimal ad placement. Someone could take the traffic blog catalog sees and turn it into a very profitable service without ruin the clean look. An entrepreneur could do this and do it well.

$40,000 / $1700 = 23.5 months earnings. Are blogs going to be around for the next two years? Chances are very good. Could the new owners expand blog catalog to offer more services to bring users back, increase new traffic and use a better monetization scheme to make more money that $1700 a month? Definitely.

And I didn’t even mention that the $1700 was purely from AdSense. AdSense that’s placed on average, one time per page!

So what can we learn from this recent website sale and transaction. Well, by the small case study I’ve provided above you can see several things, some of which I point out in my recent buying domain names article. The person who bought this site bought a lightly monetized site, with huge potential. They bought it at a relatively low earnings multiple considering the outlook that blogs are here to stay. No matter who says the blog bubble might burst.

I haven’t even mentioned the biggest part of buying blog catalog. Not only do you buy the biggest blog directory you also buy what amounts to a ginormous and very focused email list. Everyone who submits to the Blog Catalog needs to give their email address. Now I just google searched my gmail and noticed that I only recieved emails from the time that I submitted. That’s it.

You have to see the potential in other aspects of websites. Forums, directory submissions, blogs and sites with lists like this, all of those can be monetized from so many directions. You just have to be creative. The new owner could put together a sweet eBook, like the “AdSense is Dead” eBook, that I imagine really didn’t say a whole lot to help you make more from (sorry I didn’t read it so I can’t do a great review.)

You can also use that new list to launch other websites, products, and more! By buying a site like that you open up so many more possibilities by giving you a huge audience. You have to try and see all the possibilites that a website acquisition could bring you.