Is there a recommended industry standard for determining a fair price when buying/selling a shell/web hosting company?
I cant go into too many details but the general scenario is this:
Almost all hardware leased and not owned so the is virtually no tangible assets involved and no real estate or office equipment.
Hundreds of useful domains mostly setup for vhosts as the primary service is irc shells.
Great service reputation with long track record of stable customer base.
Average ticket being under $20 and the current paypal/cc processing accounts to be included to make transferring subscriptions seemless.

I used to assume that a fair value would be around the value of about 1 or 2 years of net annual profits. But I think I might be over estimating things. I am just looking to see how a company value is actually calculated around here.

And before you go asking no I do not at this time have any intention of selling anything. This question is just to solve my curiosity on the subject and to have some idea for future reference.

It used to be 10 months of gross income. Or was it net? Can't remember. Whatever it was, was way to low to tempt.

http://www.ebridgemarketingsolutions.com/

Lists of hosts for sale

An associate of mine just sold his hosting company for 12x monthly gross.

Good luck.

:D Bailey

An associate of mine just sold his hosting company for 12x monthly gross.That's what I know too, 1 year.

Prices truly very - although the articles I have read and the notes from prior hosting sales seem to show a range of one to three times annual revenue. Most people should be satisfied with two time annual revenue.

For the average small hosting company, somewhere between 8-15 months revenue would be normal. The ones that claim to get 2 years are probably well-established with other assets.

Maybe you should contact http://webuyhosts.com for a prospect?

You have to remember, most buyers are only looking at the brand (its potential and image) and the customer base. Most acquisitions move all the users over to their own hardware.

Established companies with a good brand will fetch far more than just 12x monthly gross, whereas companies with issues or publicly damaged brand will probably sell for less.

Churn rate also plays a huge part in any deal.

So many factors dictate how much you can sell for, and what the market will pay :)

It used to be 10 months of gross income. Or was it net? Can't remember. Whatever it was, was way to low to tempt.

http://www.ebridgemarketingsolutions.com/

Lists of hosts for sale


I dont get that site, how does it work.

I dont get that site, how does it work.
http://www.ebridgemarketingsolutions.com/ourservices_advertisers.html#business

Thanks bob, I completely Missed that.

I just completed a couple of fair-sized acquisitions, and can confirm that 1X yearly gross is the spot-on multiple, at the present time.