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Does a small coaching business with limited income, but excellent website and training materials have value?

I created a coaching business emphasizing retirement life planning but have done limited marketing because m primary purpose was sharing information not making money; my revenues are under $20,000/per year but the website and proprietary training materials I developed would have value to retirement life planning coaches. How to I place a value on a business with small net worth?

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Answers (3)
Pat Jennings

Hi Karen:

A business like this is usually valued at one times the annual "Owner Benefit". Owner's Benefit = Pre-tax Profit + Owner's Salary + Owner's Perks/Benefits.

If you price your business based on the earnings, your web site and training material don’t really add anything additional to that value – it’s assumed you needed those assets in order to produce the revenues upon which you calculated your valuation.

It sounds like you set up a business to serve individuals, when your real interests/expertise is in serving other advisors and coaches. I’m not trying to talk you into doing something you don’t want to do, but instead of selling would you have any interest in transitioning into a business that trains the trainers. There is a lot of good material out there on how to market your expertise – I suggest you look up a man named Eben pagan. He has some great programs for teaching people how to sell information and training products.

Mar 14, 2011
Buy-a- Company


Is it a great domain name, with high Google placement? How many unique visitors do you get per month?

Feb 25, 2011
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The BAF Group LLC

Karen, in all honesty, there is not much value - at least the way you described it. With any Web Site, if there is some sort of intellectual property that another person could not copy because of copyright protection, you might have something. But if it is a concept, the question would be, why would a Buyer pay you, if he/she could copy the concept and do it without you?

Without that kind of protected intellectual property, the only real reason to buy your concept is to capture your marketshare, your operational methodology, your brand, and the only way that is measured is through goodwill, which in turn is measured in Revenue/Profit. People with startup operations will frequently want us to sell their businesses based on "potential". And the harsh fact of life is, if it has so much potential, why didn't they make it pay off? Why did they not realize the potential, before coming to us to sell it?

That is not to say that your concept or business is not viable, or that it does not have potential. But potential and value are normally, very different issues. No one is going to pay you for the priviledge of buying a very small business at a premium, and then working their butts off, investing much more in terms of time and money, taking on much more in the way of risk (because they are possibly paying a premium for buying your business than it might have cost them to replicate it,) in order to make the potential a reality.

If the materials are the key, then publishing them and selling them as books or pamphlets may be a more viable way to go.

Feb 25, 2011

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