Rob Toth, founder of OODIENCE
Selling an online business can be tricky. You want to get the best price for all your hard work. Rob Toth, the founder of OODIENCE, has developed a method to help solve this problem. His company focuses on selling blogs, content websites, and newsletters for more than the usual market price.
OODIENCE typically works with businesses valued between $300,000 and $30 million. What makes them different is how they find buyers. Instead of just listing businesses for sale, they actively search for specific buyers who could benefit most from the purchase. This approach often leads to higher selling prices.
Rob Toth has been working in online marketing for nearly 20 years. He started OODIENCE after helping a friend sell a business. His friend's advisors couldn't find a good buyer in four months. Rob found one in just three weeks, and the buyer offered more than the asking price.
This success led Rob to create a company that specializes in selling online businesses with loyal audiences. OODIENCE has sold various types of online media, including blogs, content sites, newsletters, and even print magazines and podcasts.
In an interview, Rob shares lots of insights about their approach and why it’s successful. If you're looking to get the most out of your exit, this article is a must-read.
How OODIENCE works
OODIENCE takes a unique approach to selling online businesses. Instead of simply listing a business for sale and waiting for buyers to come, they actively seek out specific buyers who could benefit most from the purchase. This process, known as demand generation, involves extensive research and outreach.
Rob Toth and his team start by thoroughly understanding the business they're selling. They look at its audience, content, revenue streams, and potential for growth. With this information, they identify industries or companies that could gain significant advantages by acquiring the business.
For example, if they're selling a popular blog about home renovation, they might look for home improvement product manufacturers, tool companies, or even home insurance providers who want to expand their online presence. These companies might see the blog as a way to reach new customers or enhance their brand.
Once potential buyers are identified, OODIENCE creates tailored pitches explaining why the business would be a valuable acquisition. This personalized approach often leads to higher offers because the buyers can see specific ways the purchase would benefit their existing operations.
OODIENCE also maintains relationships with a network of investors and companies interested in acquiring online businesses. However, they don't rely solely on this network. For each sale, they combine their existing contacts with fresh research to find the best possible buyers.
What makes a business valuable
When evaluating an online business, OODIENCE looks at several key factors to determine its value. Understanding these can help business owners focus on areas that will increase their company's worth.
First and foremost is revenue. A business that consistently makes money is naturally more valuable. But it's not just about the total amount. OODIENCE also looks at trends. Is the revenue growing over time? Is it stable? Are there seasonal fluctuations? A business with steadily increasing revenue is typically more valuable than one with erratic earnings, even if the total amounts are similar.
Traffic is another important factor. This includes not just the number of visitors, but where they come from. A website that gets traffic from various sources (search engines, social media, direct visits, email newsletters) is generally considered more valuable than one that relies heavily on a single source. This is because diversified traffic sources make the business more resilient to changes in algorithms or platform policies.
The business's audience is also important. OODIENCE places high value on businesses with a loyal, engaged audience. This could be reflected in metrics like email subscriber numbers, time spent on site, or the activity level in comments or forums. An engaged audience is more likely to stick around after a sale and can provide opportunities for new revenue streams.
How the business makes money is another important consideration. Businesses with multiple revenue streams (like advertising, affiliate marketing, product sales, and subscriptions) are often seen as more valuable because they're not overly reliant on a single income source.
Lastly, OODIENCE looks at the business's potential for growth. This could include untapped revenue opportunities, potential for expansion into new markets, or ways the business could be scaled up with additional resources. A business that has clear paths for growth can be particularly attractive to strategic buyers.
Success stories
OODIENCE's unique approach has led to numerous successful sales, often at prices well above market rates. Two notable examples highlight how finding the right strategic buyer can lead to exceptional outcomes.
In one case, OODIENCE was tasked with selling a B2B content site focused on the animation industry. When they first listed the site, general buyers showed some interest but ultimately felt the asking price was too high. However, OODIENCE didn't give up. They focused their efforts on finding buyers within the animation industry who could derive additional value from the site.
Their persistence paid off when they connected with an animation studio interested in expanding its online presence. The studio saw the website as a valuable asset that could immediately give them credibility and visibility in the industry. As a result, they were willing to pay nearly double the market rate for the site. This sale demonstrates how a strategic buyer can see value that others might miss.
Another success story involves the sale of a 39-year-old print and digital media business focused on high school teens. At first glance, many potential buyers thought the asking price was unreasonable based on the raw financial data. However, OODIENCE recognized that the real value of this business lay in its long-standing reputation and deep connection with its audience.
They targeted their search towards educational technology companies looking to expand their reach in the high school market. Eventually, they found a buyer who understood the strategic value of the media business. The buyer saw it as a perfect channel to promote their products and services to their target demographic. As a result, they were willing to meet the asking price, which was significantly above what general buyers had been willing to offer.
These success stories illustrate how OODIENCE's approach of finding strategic buyers can result in sales prices that far exceed typical market valuations. By understanding the unique value proposition of each business they sell and matching it with buyers who can fully leverage that value, OODIENCE consistently achieves outstanding results for their clients.
Getting your business ready to sell
Preparing your online business for sale is an important step in getting the best price. Rob Toth suggests several important things to focus on.
First, build a strong email list or online community. This is your "owned audience," and it's very valuable to buyers. When you have a lot of people who regularly read your content or buy your products, it shows that your business has loyal customers. This makes your business more attractive and valuable.
Next, try to get visitors to your website from different places. Don't just rely on Google searches. Use social media, email marketing, and other methods to bring people to your site. This makes your business more stable because you're not depending on just one source of traffic.
It's also important to make sure you legally own all your content. This includes articles, images, and any other materials on your website. Buyers, especially big companies, want to be sure they won't face legal problems after buying your business.
Having more than one way of making money is another key point. For example, if you currently only make money from advertising, try adding affiliate marketing or selling your own products. This shows buyers that your business has room to grow and isn't too risky.
Lastly, write down how your business works. Create clear instructions for all the important tasks in your business. This makes it easier for a new owner to take over and run things smoothly.
Toth suggests imagining that you're buying your own business. This can help you spot areas that need improvement before you try to sell.
What's happening in 2024
Rob Toth shares some insights about the current market for online businesses in 2024. He notes that content websites (like blogs) are less popular with buyers right now. This is mainly because people are worried about changes in how Google shows search results.
In August 2023, Google made a big change called the Helpful Content Update. This change, along with concerns about AI-generated content, has made some buyers nervous about content-based businesses.
However, not all content businesses are struggling. Toth says that businesses with a mix of different income sources, a strong audience, and the potential to grow are still doing well. These businesses are seen as less risky because they don't depend too much on any one thing (like Google traffic) to make money.
Toth emphasizes that the old way of running a content business - just writing articles and relying on Google for traffic and ad networks for money - isn't enough anymore. Successful businesses now need to do more, like building an email list, creating products, or offering services.
Planning for the future
Even if you're not ready to sell your business right now, Toth recommends planning ahead. This can help you build a more valuable business over time.
Start by thinking like a buyer. Look at your business and try to spot things that might worry a potential buyer. This could be things like relying too much on one source of traffic or income, or not having a team that can run the business without you.
Next, consider getting an expert to look at your business. They can give you an idea of what your business is worth now and suggest ways to make it more valuable. This is called a valuation or audit.
With this information, you can make a plan to improve your business over the next 6 to 12 months. Focus on the areas that will make your business more attractive to buyers.
Toth also suggests thinking about hiring an advisor. This could be someone who helps you improve specific parts of your business, or someone who guides you through the whole process of getting ready to sell.
One important piece of advice Toth gives is to be realistic about your business's value. Don't set a price based on how much money you want or need. Instead, look at what similar businesses have sold for and consider the unique strengths of your own business.
How OODIENCE is different
OODIENCE takes a unique approach to selling online businesses. While most brokers simply list businesses for sale and wait for buyers to come, OODIENCE actively searches for the best possible buyers.
Toth compares this to selling art. He says, "It's like the difference between selling your art on Amazon and selling through an art dealer who knows collectors." In other words, OODIENCE doesn't just try to find any buyer - they look for buyers who will see special value in your business.
This approach often leads to higher selling prices. That's because OODIENCE finds buyers who can use the business in ways that make it especially valuable to them. For example, they might find a company that can use your website to reach new customers or promote their products.
OODIENCE uses advanced techniques to research and find these potential buyers. They look at data about different companies and industries to figure out who might benefit most from buying your business. Then, they reach out to these potential buyers directly.
This method takes more time and effort than simply listing a business for sale. But Toth believes it's worth it because it often results in better deals for the sellers. It also means that OODIENCE can sell businesses that might be hard to sell through traditional methods, like websites on very specific topics.
By focusing on finding the right match between sellers and buyers, OODIENCE aims to get the best possible price for each business they sell.
What OODIENCE looks for
When OODIENCE decides whether to help sell a business, they look at several important factors. Understanding these can help business owners know if their company might be a good fit for OODIENCE's services.
First, OODIENCE wants to see that the business is still active and doing well. They're not interested in websites or online businesses that have been ignored or aren't making money anymore. This is because it's much harder to find buyers for businesses that aren't successful.
Next, they look at the size of the business. OODIENCE typically works with businesses that are worth between $300,000 and $30 million. This range is where their method of finding specific buyers works best. If a business is too small, it might not be worth the effort to find a special buyer. If it's too big, it might need a different kind of help to sell.
OODIENCE also tries to understand how the business might work after it's sold. They think about questions like: Can the business keep running without the current owner? Is there a team in place that can keep things going? How easy would it be for a new owner to take over? Businesses that can run well without the current owner are often more valuable.
The type of business is also important. OODIENCE prefers businesses that focus on specific topics rather than general ones. For example, they'd rather work with a website all about gardening than one that covers gardening, cooking, and travel. This is because focused businesses often have more loyal readers and can be more valuable to the right buyer.
They also try to avoid businesses that depend too much on one person's name or brand. For instance, a blog called "Jennifer's Travel Adventures" might be hard to sell because it's so tied to one person. Buyers usually prefer businesses that can easily continue without the original owner.
Lastly, OODIENCE looks at the potential for growth. They like businesses that have opportunities to make more money or reach more people. This could be through new products, different ways of making money, or expanding to new audiences.
Advice for business owners
Rob Toth has several pieces of advice for online business owners, whether they're thinking of selling soon or just want to build a more valuable business.
First, he strongly recommends building your own audience. This usually means creating an email list of people who like your content or products. An email list is valuable because it gives you a direct way to reach your customers, without depending on social media or search engines. It shows that people are interested in what you offer and are willing to hear from you regularly.
Next, Toth advises getting visitors to your website from different places. Don't just rely on Google searches. Use social media, write guest posts on other websites, or try advertising. This makes your business more stable because you're not depending on just one way to get visitors.
It's also important to make sure you legally own all your content. This includes articles, images, videos, and anything else on your website. If you've had other people create content for you, make sure you have clear agreements that give you the rights to use and sell that content. This is especially important when selling to bigger companies, who will want to avoid any legal problems.
Toth recommends having more than one way of making money. For example, if you currently only make money from advertising, try adding affiliate marketing (where you earn commissions for recommending products) or creating your own products to sell. This shows potential buyers that the business has room to grow and isn't too risky.
Another important piece of advice is to document how your business works. Write down the steps for all the important tasks in your business. This makes it easier for a new owner to understand how things work and keep the business running smoothly after buying it.
Toth suggests thinking about what a new owner would need to do in their first few months of owning your business. Would they need to set up new accounts? Would they need to hire new people? Understanding these things can help you prepare your business for a smooth transition.
Lastly, Toth advises being realistic about your business's value. Don't set a price based on personal financial goals. Instead, look at what similar businesses have sold for and consider the unique strengths and weaknesses of your own business. Getting a professional valuation can help you understand what your business is really worth in the current market.
Conclusion
Selling an online business is not a one-size-fits-all process. The best approach depends on the size and value of your business. For small, neglected blogs worth around $20,000, you might not need a broker at all. A simple marketplace listing or advice from a consultant might be enough.
However, if you've built a successful business with strong assets and growth potential, using a general marketplace could mean losing out on money. In these cases, specialized help like OODIENCE offers could lead to a much better sale price.
The most important thing is to understand what your business is worth and choose the right method to sell it. If your business is valuable, with loyal customers and steady income, consider finding a broker who can match you with strategic buyers. This approach might take more time and effort, but it could result in a much higher selling price.
Remember, selling a successful online business is more like selling a valuable piece of art than a common item. Choose your selling method carefully to get the best value for your hard work.
