The Twenty-Five Most Valuable Blogs in America - 2010

The value of many of the most significant blogs have increased in the past year as the economy continued to improve and advertisers were willing to pay more to reach audiences online.

Readership at most of the 25 blogs on the list has increased. Some of them have been around for five years or longer and their competition has either fallen by the wayside or been unable to gain significant market share.

All of the blogs on the 24/7 Wall St. list are private companies, as has been true in all four of the earlier lists. None are owned by larger media companies, corporations, consulting firms, or other businesses which do not have the blog or blog network as their primary operation. Blogs that were on previous lists that were sold include Ars Technica and PaidContent.org. Last year we ranked TechCrunch as the fifth most valuable blog with a value of $32 million. Based on recent media reports, AOL acquired the blog for $25 million to $40 million. 24/7 had estimated its revenue at $9.5 million and operating profit at $3 million. These almost exactly matches what media reports say the figures for TechCrunch will be this year. 24/7 Wall St. took most of its valuations of blogs on the list up 15% based on multiples of revenue and operating income–if the companies are profitable at all. This was based on the state of the economy, the value of some publicly documented media M&A transactions and the stock market values of media companies over the last year.

24/7 Wall St. estimated blog audience sizes by considering several audience measurement sources, not all of which measure every blog on our list. These included Quantcast, Compete, Alexa, Technorati, and comScore. These services have been criticized for low measurements of visitors and pageviews. 24/7 has, in some cases, accepted audience numbers from the blogs themselves, if they can be verified. Additional factors in blog valuations include the revenue from the advertising that sites run based on estimated CPMs and the number of ads run on each page. We also include blog audience growth rates, and operating costs, including staff, IT, overhead, and marketing and PR. Blog companies with related businesses such as conferences, like TechCrunch’s Disrupt gathering, get credit for the revenue from those as well. Blogs that are profitable get a higher valuation than those which are not.

One of the most important measurements of value is whether a blog is large enough or has a sufficient number of unique visitors to have a “moat” around it. Moats rely on editorial quality, sources, original content, established advertising bases and access to capital. Moats make it harder for other companies to create meaningful competition. Moats are not as deep if the owner or founder of a blog is essential to the blog’s success. It is not by accident that AOL locked in the services of TechCrunch founder Michael Arrington for three years and kept most, if not all, of the blog company’s staff.

The extent to which a blog runs controversial content was weighed, more heavily than last year. The rise of political blogs, many of which are polarizing, has limited the number of potential buyers. Other blogs publish controversial content which would also limit the potential pool of buyers, and therefore pushes down value.

Below are The Twenty-Five Most Valuable Blogs for 2010 ranking in order of most to least valuable.

1. Gawker properties.

Valuation: $240 million.