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ANDREA
ANDREA, Attorney
Category: Business Law
Satisfied Customers: 11259
Experience:  25 yrs exp Real Estate & Business Transactions, Post Doctoral Degree, LLM, Taxation
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how much is a webite worth? I was a partner in developing

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how much is a webite worth?

I was a partner in developing a website. we spent months developing the site, and over a year marketing it. but we did not generate $1 in revenue. now, over a year later, I want to:

1) redo the entire site
2) completely re-brand the marketing message

and it will take as much capital to do this as was initially invested. I've asked my business partner to join me in contributing capital to do this. but he refused. I said I will start a new company. he hinted as suing, saying I will take his idea -- an idea that is already being done by at least 10 other website with a 10 minute google search (btw, we will not be using the same code base and the look-and-feel will be different, and probably of most importance, the way we go to market will be different).

now the business partner says that he would consider partnering with this new venture, but he wants to valuate the old site (something that has been sitting in the public domain for over 2 years) at what the development fees to create the site and the marketing costs that were spent to try to get the site off the ground (which did not generate $1 in revenue). His formula is: I will invest all the capital for the new venture, taking on all the risk associated with doing this, but he will retain 25% of the company. I don't think that is fair.

My point is this: the value of the old site is 0. It's worthless. there is no value because we not only tried to market it and failed, we even tried to get venture capital, and that too failed. I guess the only argument that could be made is that if we had the "right" buyer, then maybe it would be worth $1M. But that's ridiculous. I believe the valuation of the website is dependent on is traffic (which there may be some odd person stumbling on the site today), it's membership (which only includes the 2 partners, and a handful of friends who initially tested the site), it's advertisers (0), and it revenue (0). And the fact that the site has sat for over 2 years, with a technology that is somewhat unstable.

If I decide to move forward without my partner (he refuses to conceded that our former venture resulted in a site that is much less than what was spent to create and market the initial site -- I argue 0), how will a court of law rule in the area of:

1) the initial site value
2) whether or not I "stole" an idea

?
Submitted: 5 months ago.
Category: Business Law
Expert:  ANDREA replied 5 months ago.

Hi, my name is XXXXX XXXXX X will do my best to help,

 

 

1. The initial site value - There are two possible ways to determine this. The first way would be the "Fair Market Value" of the site which is what a willing buyer would pay for the site and what a willing seller would accept in order to sell the site. But since there is no buyer and the site is not for sale, the second way to determine the value of a website is from the revenue it generates. Since the website has been sitting idle for 2 years and you have been unsuccessful in raising any money from it, one would have to conclude that the website was not worth anything;

 

2. Whether or not you stole an idea - If one wants to protect their ideas, they would register them with the US Patent and Trademark Office. However, even though an individual does not protect their idea by registering them, they can sue you, tie you up in litigation for years, and cost you thousands of dollars in legal fees just to defend your position that you did not steal an idea.

 

The demand of your partner (or former partner) 25% interest in the new website you are developing without taking any risk is outrageous. If he insists on 25%, you should take a variation of that idea and use it in your new development. I do no know if that would be possible because you have not given enough facts and I do not have the technological background, but what I am trying to say is taking the idea that you will be accused of stealing and changing it somewhat, to a degree that it is different enough so that he cannot accuse you of stealing anything, so that you can create your own website without having to give him 25% of anything,

 

 

Please be kind enough to rate Excellent Service" so that I receive credit for assisting you, it will not cost you anything additional to leave a positive rating, and that is the only way I can receive credit, Thank you for understanding,

 

If you receive a Customer Satisfaction Survey from JustAnswer, Please rate a 10 as it gives me a greater opportunity to assist other customers on this website and is greatly appreciated,

 

 

Thank you for allowing me the opportunity to assist you,

 

ANDREA

 

 

 

ANDREA, Attorney
Category: Business Law
Satisfied Customers: 11259
Experience: 25 yrs exp Real Estate & Business Transactions, Post Doctoral Degree, LLM, Taxation
ANDREA and 4 other Business Law Specialists are ready to help you

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