I want to share some insights on how you can estimate the SaaS project.
This method is universal, but it isn’t suitable for all of the cases. For example, you can’t estimate other types of projects like newsletters or communities.
So, let’s start.
Take your trailing 12 months income and subtract your expenses.
For example, you got $3,500 in revenue in the last 12 months minus $500 for ads, domain, and hosting. The result is $3,000. This is your annual profit.
Then multiply it by 2-5. The multiplier depends on a variety of factors. The most common multiplier I see is equal to 3.5.
Therefore we can multiply our $3,000 by 3.5 and get a $10,500 asking price.
But of course, that is only applicable for SaaS projects.