Ask HN: Someone wants to buy my side project, How do I decide on the price?
Few months ago I developed a real-time location service Shaloc.com, its a iPhone app that lets you share your GPS location with friends using a web link, your friends can check/track your real-time movement on any browser, with any login or app download. People have been using it in a lot of ways, its got 5 star rating in appstore. Few people have been interested in the service and creating new verticals.
I have moved on and working on another idea, but one guy is really interested in buying Shaloc.com, How do I decide on the pricing if I want to sell it? should I let him give a price or should I give him a price?
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Asking the potential buyer to name a price is a good strategy, as others have noted. However, if you want to stretch things out a bit, you can start by asking questions that lead up to him naming a number. For example, ask how he would determine a value? How does he expect to make money with it? How much money does he expect to make with it over the next year, two years, five years?
As you go through this kind of dialogue, you might find, if he has wildly ambitious plans for your service, that a combination of upfront amount plus an earnout amount makes sense. Maybe that includes your staying on as a consultant for additional money as well.
Your first move is to do some research. Find out why he's interested. If he's looking to build it out or into another service that he offers consider what it would cost him to build it in house and go from there.
If you can't find any info then it gets a bit more complicated. Letting him name a price is a risky play because he can set the "anchor" price low and cause the rest of the talks to revolve around his low price.
Typically when someone offers to buy something that is not for sale, they will suggest a starting price for the negotiation. This gives you a slight advantage as you have something they want and you're forcing them to take an opening position.
Basic negotiating strategy will tell you that you should force him to name the first number.
But consider a different way. Pick a price that you'd be happy to sell at, and name that price. If he takes it, try not to regret asking for more.
Clickable link: http://shaloc.com