Martin Lewis Sells MoneySavingExpert.com For £87 Million?
If you’re reading this and in America, you’re wondering first, who is Martin Lewis, second why is his website worth £87 Million, and third, what does that convert to in American dollars? Well, Martin Lewis is an Englishman who’s work on the area of personal finance is such that when the deal was announced, the BBC referred to him as a “High-profile personal finance commentator and campaigner.”
As to why the site is worth £87 Million, the short explanation is that’s what the buyer MoneySupermarket Group was willing to pay for it: a mix of cash and stock and is £60m up front with the remaining £27m reportedly dependent on meeting non-financial goals. But make no mistake about it; Martin Lewis site was a moneymaker, and generated revenue to command such a deal according to Belfast Telegraph:
According to Google Analytics, the MoneySavingExpert website attracted 39 million unique visitors and around 277 million page impressions in the year to October 31. It generated revenues of £15.7 million over the same period.
And finally, the pound to dollar conversion rate is 1.5350, meaning the site sale is worth $133 million in America – that’s $101 million more than what AOL bought TechCrunch for in 2011.
As to the site itself it was founded and is singularly owned by financial journalist Martin Lewis, who launched in February of 2003. (And about the same time as I started Sports Business Simulations, but Lewis started with a lot less money required because he wasn’t building a game or paying someone else $4,250 per year for a specialized server – he had a simple website and one focus. It’s via stories like this that Internet entrepreneurs learn what not to do, next time around.)
In Martin’s case, the success of his site is a testament to Affiliate Marketing. A walk around MoneySavingExpert.com is a cyber theme park trip through deal after money-saving deal on everything from utilities to Burger King hamburgers.
But beyond Affiliate Marketing, Lewis also gained fame as a consumer campaigner. His most famous move was to reclaim usury bank charges for Britons in 2005. In all, he’s helped millions recover money from bad credit card charges and mortgage fees in this way.
Moreover, that Martin Lewis could command this kind of sale is also a complement to the public good will he has developed, and the Guardian UK and The Times have even praised the site itself.
Implications For Tech?
This isn’t anything earth-shatering to this blogger, but it just may be to the causal observer who has not caught on to the idea that online media has value. It does and the important take away is that online websites can cause massive levels of value to be constructed with little or no up-front capital investment, and a lot of focus and drive. This isn’t an Instagram deal, because unlike that site, MoneySavingExpert.com did produce monetary value, but it did not claim the gigantic user base Instagram had and that caught the eye of Facebook CEO Mark Zuckerberg.
But, and as Venture Capitalist Rick Bolander said in my interview, the fundamentals still matter:
Finally, another takeaway for the observer is something I’ve always said before about web companies: form follows function such that how nice a site looks is seldom an indicator of how much money it will make. MoneySavingExpert.com is a “busy” website design – so busy it generated £87 Million for Martin Lewis.