Another Huge Vote for Investment Bankers

In case you haven’t been reading any blogs lately, Bankrate.com bought one-man blog Bankaholic for $15,000,000 this week.  Duncan Riley summed up many people’s thoughts about that when he wrote:

You would presume the site was making good money by the sales price, but nothing else about the site stacks up. Traffic isn’t brilliant, matched by irregular posting at best. Quantcast shows 156,000 uniques on 263,000 visits, Compete puts the unique number at 300,000. The site has an Alexa ranking of 42,168. Since September 14, there has been only 9 posts to the site, and comments vary from a few through to the highest at 20.

Without knowing all the actual details (well, the revenue mostly), it’s had to definitely say that this blog was over priced, but the amount paid for it is staggering, and I’m surprised others aren’t saying the same thing. This wasn’t a blog network, or mega-blog with a team of writers; instead it’s a one man blog running a mix of Adsense units and affiliate offers!

How’d they get such a good price?  Mark points out just how valuable traffic like Bankaholic’s is, and that’s absolutely got a lot to do with it — as does Bankrate.com’s probable desperation to shore up their business in this economy.

There’s another factor at work too, though.  I just talked with my bankers and found out that they represented Bankaholic’s owner, too.  You can’t overestimate the value of having a great investment bank on your side.  They have proven time and time again their ability to turn a good deal into a outstanding deal.