A friend of mine sent me an email today, asking about a Private to Private sale of a website and how to Value it. I enjoyed thinking about the dynamics of this and enjoyed answering his question; so, I (with his permission) anonymized the question and have provided my answer below:
My partners want to sell our project - basically the IP, the domain, and any related assets. Given that the site site is fully built but not yet launched (<10 uniques/day from 130 beta users), how should we go about valuing the sale?
"Deals" like these are insane to price, because the market for "fully built, specialized websites" is about as illiquid as it gets.
Valuation in this case can't be priced by the market in terms of anything but what someone would have to pay to have the same thing developed. No one is buying your users or brand at this point... so they'll buy the development effort you put in, and maybe pay a premium because of initial feedback from these users (i.e. product feedback from 130 users is more valuable than then "users" themselves).
Considering this, market dynamics will drive valuation according to 1) a prospective's buyers interest in having exactly what you developed; or 2) competition between buyers who sorta want the same thing.
Since it's unlikely someone desperately wants exactly what you have exactly the way you made it, competition is key to this private transaction.
So to answer your question... If you told me you know no one who's strongly interested in pursuing a business like the one your site supports, I would tell you your valuation is close to zero (this was my case with BricaBox).
If you told me you had two people who were interested in pursuing this as a business, so much so they would have gone out and hired a firm to build it, I would say the valuation should be slightly higher than the cost of development from scratch.
If you told me something in the middle it would be something in the middle.