How do you value a directory?

[temi]

Two people recently asked my opinion on what their directory could be worth, I did not have a good answer as I don't know.

Using our combined expertise in this forum, why not let us see if we can come up with sets of criteria we can use to value a web directory, please add your suggestions to this post, we will then use the criteria to do a demo valuation on one of my directories.

So, off we go, what is the first item to consider ?

[Resonate]

Good question Temi, i dont value just directories this way mainly all websites but i tend to go in the order of:

1. Backlinks (the more backlinks, the more value)
2. Traffic (valuable source of traffic bumps up price)
3. Domain Age (i believe this at times v. important)
4. Directory Software (directory licence (if any))
5. Skin (custom made adds value)
6. PageRank (for those finatics out there)

[temi]

Thanks for that resonate, the reason I mention directory in particular is that they tends not to have quality contents, most directories just contain categories and sub categories listing sites, unlike website that probably has original contents and less outgoing links which makes website more valuable than directories.

[Resonate]

Hence there are some excellent directorys, I believe a directory becomes more valuable when they are well organised, totally spam free & unique. Two come to mind which i know of being bagi's directory & skinners w3bids, both look great & are very well organised.

Two directory's i would actually consider of value.

[temi]

Other factors to consider in directory valuation:

Domain Extension - .com is probably more valuable and easier to transfer than .co.uk
Niche of Directory - A finance directory for example will be more valuable than a hairdressers or general directory.
Revenue - Is the directory generating verifiable revenue?
Source of backlinks - Are the backlinks from diverse sources or are they all from the vendors other sites?

[OldWelshGuy]

I see only TWO issues to consider.
1. Current earnings
2. Potential future earnings

I am a simple chap who believes in keping business as simple as possible.

[Resonate]

Originally Posted by OldWelshGuy

I see only TWO issues to consider.
1. Current earnings
2. Potential future earnings

I am a simple chap who believes in keping business as simple as possible.

Got to agree, i must admit i have always kept my directories free & ad free too. May have to change that slightly

[OldWelshGuy]

If a site is earning £100 a month, and I can see room for improvement in marketing/seo of it a few hundred%, then I see it as say a £300 a month site, and as long as I can make my money back in 12 months I am a happy bunny.

I rarely buy sites though as I prefer ground up building from concept to completion. Sell a couple though.

[scoobby]

also you have to consider if it is well indexed if the SE visiting it often and the internal pr value

[clangallacher]

I totally agree with OWG, but to achieve your anwser, you must have a combination of Resonate and Temi's considered factors or parts there of, or the site to be sold would not have any:

1. Current earnings
2. Potential future earnings