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N Cal Atty
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How is the value of a website calculated? Is it based on

Customer Question

How is the value of a website calculated? Is it based on what it earns? What the website developer was paid?
Submitted: 3 months ago.
Category: Canada Law
Expert:  N Cal Atty replied 3 months ago.

Thank you for your question.

What the developer was paid is not relevant, what the site earns is a factor.

"The way a domain name value or website value is calculated depends on some specific factors. As a matter of fact a domain name value or website value is calculated by looking carefully into some important information which are available online and the most important factors are: Unique Daily Visitors, Page Views, Google Page Rank, Alexa Rank, Compete Rank, Quantcast, Backlinks, Social mentions on sites such as Twitter and Bookmarking on Delicious, Digg, StumbelUpon, Reddit etc…"

from

http://www.urlrate.com/

I hope this information is helpful.

Customer: replied 3 months ago.
Thanks. I just found this, looking for "website valuation". http://www.worthofweb.com/calculator/
Expert:  N Cal Atty replied 3 months ago.

Interesting. That site uses fewer factors than the one I linked to originally. These are both estimates, and a more solid valuation would have to come from a professional appraiser.

Customer: replied 3 months ago.
I spoke to a Business Valuator and he said that if a website is considered a business asset, the value of the website is primarily determined by the income it generates. So, if the website is an asset of a sole-proprietor where the only real value of the business is in the person's services, both the business and the website would have no value.The way he phrased it was, "If you were to get hit by a bus tomorrow, would the business still earn revenue". The answer is no, so there's likely no value.
Expert:  N Cal Atty replied 3 months ago.

I disagree with that analysis. A sole proprietorship can still have a value for goodwill which can be estimated based on how much revenue is generated by the website both through the business it generates and the ad revenue it generates.

Customer: replied 3 months ago.
Ok, interesting. There is no ad revenue. The website serves 2 purposes: it is a marketing tool to gain exposure and it uses an online booking system to schedule clients. The revenue is generated when those clients come in for a treatment.
Expert:  N Cal Atty replied 3 months ago.

What is the purpose of the valuation?

Customer: replied 3 months ago.
A divorce settlement. I built a website for my ex-husband's business. I need to inform myself in case his lawyer tries to claim that he has access to half the value of it.
Expert:  N Cal Atty replied 3 months ago.

Which State is this in?

Customer: replied 3 months ago.
Canada
Expert:  N Cal Atty replied 3 months ago.

I am sorry, I will have to opt out and ask the moderators to move this thread over to the Canada law experts.

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