How to Analyze a cash flow portfolio

[ptaylor]

I am trying to build a model to analyze a cash-flow/typo portfolio I am looking at buying and would appreciate any feedback on my approach. Here are the factors in the model I am creating:

1. Volatility of cash flow: The more volatile the cash flow the lower the multiple
2. Cash Flow Trends: Looking for positive growth trends
3. Total Revenue: Domains earning more are valued at higher multiples to a given point and then they are valued at lower multiples.
4. Trends of Root Domain : Look at Google trend data for the root domain.
5. Trademark: Run the domains through a trademark scanner to determine if TM and if so how strong of TM.

Any feedback would be appreciated.

 

[Biggie]

i guess it's good to have some criteria for evaluating a domain, but you still have to get the owners to sell within your parameters.

that will be the hard part.


once you get all your criteria together and start implementing it towards prospective purchases, if you ever mention that your offer was generated based on that criteria...it may turn most sellers off.


like you tell me that you ran my domain thru a series of criteria and this is the amount that you think is fair, based on those results.

if your offer was too low, i would probably say... "none of that crap means anything to me, go try that on somebody else".

if you offer was acceptable, then you may have come up with a good evaluation model.