Flippa.com Website Valuation : Is it Accurate or Worthless?

August 9, 2012 - Last Modified: August 9, 2012 by Hesham Zebida 3,740

Whither you are flipping websites or you are a website owner, it’s so important to know how much a website worth before buying it, or how much your websites might be worth, especially if you treat it as one of your business assets.

I assume that many people in our niche -the making money online niche- would love to get a satisfying answer and a fair website valuation based on a trusted source.

Would you like to know how much your website worth?

I just heard about the new “Beta” Website Valuation Tool that is created by Flippa.com -a leading marketplace for buying and selling websites– and wanted to give it a try to see how it works.

Flippa’s website valuation tool uses their own marketplace data and other information provided by third-party metrics to evaluate websites.

How much is my website worth?

[box type=”important”]Before we get started with this, I just want to make sure you understand that most of valuation tools are calculation its data based on an algorithm, which leads to inaccurate results in most cases.[/box]

Flippa valuation tool provides two types of valuation, Basic Valuation, which can be done simply by adding your website URL, and Advanced Valuation, which require you to provide more information data about your website like unique visits number and monthly revenue .

Flippa’s Basic Valuation

The Basic Valuation is done based on third-party metrics like Alexa Rank, Google PageRank, Google Links, Domain Registration Date, SEOmoz Rank and Copyscape.

By testing several website valuations using Flippa’s tool, I found out that most results are too low, inaccurate by all means, and doesn’t make sense. In my personal opinion, the valuation results has nothing to do with the real worth of a website, even though it returns a price range (which is ridiculously big)!

So, I can simply describe Flippa’s basic valuation in one word: Sucks!

Flippa’s Advanced Valuation

In the Advanced Valuation you must fill a form to send unique visits number, monthly revenue and an email which the data will be sent. Once you hit the submit button you will get the valuation results by email.

The results data looks much better than the what I’ve got from doing a Basic Valuation, however it still inaccurate. I mean, the number of unique visitors and monthly revenue is not quite enough to give a fair valuation of a website, it’s too low than it should be.

But, anyways… I am sure that Flippa’s team made that tool with their marketplace in mind, and to mostly help their members, or to attract new members to the marketplace. So, I hope the valuation will not have a bad affect on the marketplace or website prices.

Flippa’s Valuation Tool FAQ

From the blog post where Flippa introduced the valuation tool:

How Accurate is the Valuation Tool?

We’ve been running this website valuation tool across Flippa sales in the background over the last 6 months or so. We’re seeing an accuracy of almost 90%.

Why does the valuation tool return a range rather than a number?

The tool will always return a valuation range. This is because there tends to be a significant amount of variability in both websites and the transaction values they sell for. The size of the range tends to reflect this.

What does Flippa Rank mean?

We’re toying with the idea of a Flippa Rank (not at all related to PageRank) so as to provide a relative measure between website valuations. It runs between 1 and 10 with 1 being the lowest value and 10 being the highest.

Sample Site Valuation Result

I’ve done a valuation for one of my sites ThesisAwesome.com that I’ve published a snapshot of its revenue before on the blog, the results are shocking though.

How come I will sell a business site that has an average of $30,000 / yearly income for ($27,250–$43,200) ? This doesn’t make any business sense!

Note: I am not selling my site or anything from that, this is only to give you an example.

Other website valuation tools

Here is a few other website valuation tools that sucks, but well.. You may want to take a look at it:

Share your thoughts about website valuation

I’ve seen a lot of valuation tools, most of these tools have one thing in common, which is inaccurate valuation. Plus, most of these tools overestimate the value of websites.

So, I credit Flippa’s valuation tool for NOT overestimating website values, and also trying to provide a price range, however I hope they can put more development into the beta tool and make it worthy and considered as a trusted source of information.

Try Flippa’s Website Valuation first, then let me know…

What other matrices should be added to the algorithm?

Is there any accurate website valuation tools on the planet?

About Hesham Zebida

Follow @hishaman

I create websites with WordPress, and I develop Schema Plugins to help SEOs. I am a social network lover. I am also the night creature who works hard to keep this project up. Owner and founder of the Famous Blog.

{ 20 Responses }

Chris says:

I would have to agree with the people who feel there is no accurate way to value a website unless it is a real person performing the valuation. There are too many unpredictable variables for a program to calculate the value and this shows in the discrepancy between the value you get from different sites. I was getting similar results as quoted in Mitz Pantic's Post: "[One site values around] $300,000 while others are around $20,000 and this is for the same website"
Enstine Muki says:

Hey Hesham, I think they should take down the basic valuation option. It's practically out of range in most cases. I tested a site that was sold for $20k on Flippa itself and got some ridiculously low figgures. I can't trust those results
Mitz Pantic says:

I am not a fan of website valuations unless it is done by a real person. There are just too many variables. I have seen values at $300,000 while others are around $20,000 and this is for the same website. This is when you use those valuation sites. I haven't checked out the flippa one.
Pauline R says:

Some of their numbers are really too high. There is no accurate tool as of now but I am sure there will be something very soon. Lots of factors are considered when we try to value a website. The tool needs to consider most of these points to ensure we get the most accurate value for our website.
Glen says:

accuracy rate of 90%? I'm seeing PR2 sites valued at $2000+! Are you kidding me? One can always get a PR2 and spend less than $2000. I'm not too sure anyone would buy a default-themed site at PR2 for $2000 there. Just not too sure.
Anup Kayastha says:

There is not any "accurate" website valuation tool yet but till we can check the site stats and negotiate about the price of a site.
Samuel says:

Flippa.com Remains the Only i i deal my website business with. I still think there for them to review their Price tag, especially in the issue of Deposit
Joe Boyle says:

You get what you pay for, right? Flippa's website valuation is only going to give you that range because it's not really entirely possible to value a website based on an algorithm. Amount of content, reader loyalty, backlinks, is it built with SEO, and the list goes on and on. There's so many things that need to be taken into consideration - it's just impossible for an algorithm to calculate it all when services like Alexa even do. I was always taught that a website is worth 12 months of its income, but that isn't always accurate. It's really tricky and goes case-by-case, in my opinion.
Faissal Alhaithami says:

Well, I checked out Flippa's website evaluation tool a few moments ago. I tried to evaluate three different sites, but the result showed the same 'valuation range' for all of them: $250 - $7,200. I doubt whether the tool is really a good one. Thanks for the share!
Faissal Alhaithami says:

Flippa is one of the most preferred platforms when it comes to buying or selling web properties. But before you want to sell your website, you must know what it's actually worth of. Using multiple website evaluation tools and then comparing the results can provide a good picture, as I think. Thanks.
Saad says:

I Think its not really possible for a specific algorithm to estimate a site's value, website worth is dependent on so many different factors which are overlooked by these so called "website estimators"
Alan Tay says:

To answer your question Hesham, I'd say it is worthless and I completely agree that there are tons of worthless tool out there to evaluate. I used to evaluate one of my low traffic PR 1 site and evaluation says it worth $8,000. I only ask myself back "Are you kidding me?". I personally think that site evaluation is pretty dependent. It is not some hypermarket price tag but a site usually values different from different person.
Ophelie says:

"So, I can simply describe Flippa’s basic valuation in one word: Sucks!" Ouch! But yes, compared to the advanced valuation, the basic valuation is, well, basic. It gives a wide valuation range. We then encourage users to submit more information about their site because, as you note, traffic and revenue are the real drivers behind a site's value. The tool isn't perfect, and the fact that it's in early Beta is highlighted on the page. We're getting a lot of good feedback about it so far, which will help us improve the valuation tool in subsequent releases.
- Hesham Zebida says:
  
  Hi Ophelie, That's only my personal opinion, I know you guys are trying to do something good, and I know that it's still in beta, but not sure why you would create a tool that actually doesn't work, maybe you have a different definition for "beta"?! I suggest you build a team of experts and establish a paid service to valuate websites and certify it based on your experience and standards, in this case you would be the first who do this, and you could gain a lot of trust as this is your field of expertise. I hope you consider this as a good feedback, and thanks a lot for your appearance, I appreciate it.
Annabel Candy says:

Hi Hesham, It seems to be a bit worthless, just giving a generic range for both my blogs. Generally blogs seem to be valued at five times their annual income and in your case it's proved to be no where near right. Some nice publicity for Flippa though as everyone will be interested to see what their blog is worth.
- Hesham Zebida says:
  
  Hi Annabel , This is exactly what I'am talking about! However, it depends on the valuation method, and it's clear that Flippa's method doesn't reflect accurate results even though they are using real data from their marketplace! I respect they provide a range, but I can't think of $4,000 – $89,000 to be anything but funny numbers!
  - Annabel Candy says:
    
    Lol, yes, when it's that vague it's not worth having:)
DiTesco says:

Hi Bud. Its ironic because I was just testing Flippa's valuation tool, and while it appears to be more accurate than the others out there, it probably needs a bit more of tweaking. I found that unless you go the extra mile of providing your revenues and unique visitors, the price range that it returns is worthless. Tested different sites with different metrics and the results where virtually the same. I think it is a good start, but like you said, there isn't really any valuation out there that's worth the salt.
- Hesham Zebida says:
  
  Hey Buddy, I agree with you, it's a good start, maybe we will have a great tool when they go out of beta! However, I don't think that algorithms could solve the website valuation dilemma, especially that there is a big difference between a value of a website and a value of a "business website" that has history, brand and followers!
  - DiTesco says:
    
    I totally agree with bud. That is mainly the problem with these valuation sites, they never account for the "goodwill" that a business site has. Most of the time, valuation is based solely on metrics (which are also not too accurate) and earnings. The later does provide a good benchmark, however, how in the hell would a valuation site know about earnings anyway? Oh well :)

Flippa.com Website Valuation : Is it Accurate or Worthless?