How much should I ask for my digital product?
I've a digital product (i.e. premium wordpress theme) which I was selling on a popular marketplace (i.e. themeforest). The product took me around 8 months to research, design and develop and I finally published it on themeforest on Dec 2018.
During the period of (Dec 2018 - June 2020) it earned following figures...
- Total Profit (for 19 months) → $16,331
- Monthly Profit (avg) →$860 p/month
After Feb 2020 I had an unfortunate event in my family and I wasn't able to continue providing customer support for this product, due to which the product revenue stalled a few months after. I'm still not able to take on the product so I was hoping to pass it to someone who can take care of it.
Given this scenario, my questions is, how much should I ask for selling all rights to this product? So the buyer can buy it out and can sell on it's own afterwards.
Hi Faisal, I wrote an article on this exact topic. It might help: https://dealsflow.com/how-to-value-a-website/ .. it's not geared towards themes, but might still give some orientation.
In regards to the price eventually being too low: just see what the Flippa auction model does. Did you look at comparable theme sales in there? Would you mind sharing the Flippa link so I can have a look?
Thanks for the article link, I'll take a look.
I don't see any other theme being sold on Flippa so cannot really compare. You can take a look at my flippa listing here: https://flippa.com/10395587-e-commerce-business
Typically sale prices of businesses are between 3-5x of annual revenue. It doesn't matter how much time you've personally spent on it, it normally comes down to reliability of revenue.
I guess theme's get outdated quickly and the fact that you haven't been maintaining it makes it very risky for someone to take it on.
No firm answers there, sorry. But if I were you I'd try to find out if anyone else has tried to sell something similar and see if you can figure out how much they sold it for.
Thanks for your reply, do let me know about your findings.
I agree "reliability of revenue" is an important metric. Since, I won't be selling my ThemeForest profile (just the actual theme) they buyers has to know how to market the theme, so the future revenue depends on buyer marketing skills. Alternatively, the buyer can sale it on other marketplaces.
That being said, the product is proven to sell and has quite good rating and reviews. So the historic revenue and performance should tell you something.
As for the potential of the theme being outdated, it is a possibility however not every WordPress update break things which in turn require you to update your plugin/themes. As for my theme, I can make sure that it is compatible with latest WordPress version before finalizing the deal.
Considering the above factors I've put it on sale on flippa and indiemaker for $8,500 and that's not even 1x annual profit, i was just concerned that if the asking price is too low?
Hey @imfaisalkh, have you sold it already? If not, email me at david@taikohub.com.
Sent you an email.