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WCI’s networth is an estimation or is that real?
There’s an old saying that if you can pinpoint your net worth to the penny, you must not be that rich. You tell me what WCI and my house are worth and I’ll tell you my net worth. Everything is an estimate really, including the value of the stocks and bonds in my index funds.
To be fair, when I did that survey, I said the following when asked my net worth:
“Depends on the value of the website, probably somewhere between $4 and $6 Million.”
They apparently split the difference. At most this website may be worth $3.5 Million. At the least, it’s worth a million. And of course 25% of that disappears to long term capital gains taxes. Of course, some portion of my retirement accounts doesn’t really belong to me either. Nor do those UTMAs, Roth IRAs, and 529s for my kids. I’m certainly a multi-millionaire, but which million is a little hard to say.
The really interesting thing about that list, however, is just how many financial bloggers there are with a net worth under $100K. There are really two types, I suppose. Type # 1 has “been there and done that” and can teach you how to do it too. Type # 2 is asking you to “walk with me while I learn about finance and build wealth.” Both can be useful depending on where you are at in life.
I think I’d lose a lot of credibility if I didn’t have a rapidly growing net worth at this point in my life. We basically locked in our lifestyle at what we could afford on a pre-partner salary (a little under $200K) and aside from the occasional big splurge (the boat, the new car last year), save or give the rest. When you’re saving 2/3 of a very good net income, your net worth grows rapidly. When you actually like the work you do and plan to do it indefinitely, then you start realizing the assumptions you started with a decade ago may not apply in retirement. For instance, I never would have guessed I was going to have an estate tax problem. But if I keep working and earning like I have been the last couple of years, we almost surely will. Makes me wish I’d done more Roth 401(k) contributions and conversions back in the 28% bracket. First world problems…
I don’t know that I’ve ever blogged about my net worth (Although I certainly wrote about it in the book), but given that my readers are very well aware of what emergency physician partners make and know exactly what this site makes, and know about what we save and spend each year, it shouldn’t be surprising to anyone. It’s just a math equation.
Can you expand a little on how exactly a site like this is valued. It seems like the main value is you and the content that you generate. If you were to sell it and leave completely, then they would have to replace you with someone else. That alone would probably reduce the value significantly. I suppose probably the best way to extract value would be to sell and stay on for a few years, while the replacement can get a couple of years of posts and exposure after which you would fade out. But even then, once you’re gone, there’s still going to be a drop.
So really the question is that if you’re an individual who could produce the type of content that WCI can, how much would you pay to take over vs starting from scratch. I really have no idea. But what does seem unlikely to me is that any of those people would want to cough up 1MM+ to buy this. So at the end of the day, I’m really just left scratching my head. How does one sell something like this site and what type of buyer. I have no doubt that you could get at least a couple of million for the site, I just don’t understand why.
There’s lots of value in an enterprise such as this. I’ve got a valuable trademark that I’m defending vigorously from others trying to glom onto it to sell docs insurance. The SEO/advertising value of the site is worth about $78K a month (i.e. if someone just bought the site and redirected all URLs on it to their site that’s the equivalent of paying Google $78K a month to get that much traffic). Most of the content is evergreen and will last a long time with no updating.
If I did NOTHING from now until the end of the year the site would still have a mid six figure income. There’s real value to that. With a team working on it full-time, it could grow into something 5 times the size (although probably not 50 times the size). So there are certain people in the world who see value there. I recently turned down a very nice 7 figure offer for the site. Many well-known financial sites out there started out as blogs like this one.
The general valuation figures are somewhere between 2 times profit and 5 times revenue. But the idea when buying one is to buy one that you can add something big to with your talents, skills, and work.
If someone comes to me with some ridiculously huge offer, I’d probably sell tomorrow. But if they’re only offering me a fair value, I’d like to keep doing this for at least another 5 years and who knows, maybe my daughter will take over when I’m done. At any rate, any sale is going to involve me staying on for a year or two to aid in the transition so it’s unlikely I’d ever disappear on you suddenly. At a certain point, something like this becomes a question of “What do I want to do with my life” rather than “how much can I get for this?” Once you have “enough” getting more doesn’t really change things much.
I find this really incredible. I had no idea that a blog could turn into something like this until reading about your success. I used to run a blog of my own when I was in residency. It was all about the urban neighborhood we lived in and the transformation going on there. Lots of politics, new businesses, social events, things like that to write about. I didn't take it seriously enough though and eventually it fizzled out. But, it got a decent amount of traffic for awhile. I even got a call from a reporter at The Atlantic magazine once wanting to interview me about gentrification in our city. That was probably the highlight of my blogging career and made me realize people were actually reading. But I never could have dreamed that something like WCI's success was possible otherwise I would have worked harder! I never made a dime off it, but really enjoyed doing it. It didn't seem like work to me at all because I was writing about things I really cared about.
and looking at ecommerce seriously.
and looking at ecommerce seriously.
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